Instagram’s Founders Depart from Facebook, Inc.

On July 16, 2010, the CEO and co-founder of Instagram, Kevin Systrom, posted the very first photo to the social media platform, which depicted a golden retriever next to a taco stand. (Olivia Waxman, The New York Times). Within 18 months, Facebook, Inc. purchased Instagram, and nearly 8 years after Instagram’s inception, the co-founders of Instagram, Kevin Systrom and Mike Krieger, announced their resignation from Facebook, Inc. in a New York Times article. (Mike Isaac, The New York Times).

Kevin Systrom and Mike Krieger (the “Founders”) founded Instagram in 2010 as an app focused on location check-ins. (Daniel Victor, The New York Times). Early on, the Founders noticed that users were mainly using the app’s photo features. As such, the Founders decided to redesign their app to focus on photo sharing. Id. The Founders worked out of a small office in San Francisco’s South Park neighborhood and spent a lot of money trying to keep the app online as the app gained in popularity. (Mike Isaac, The New York Times).

After the redesign, the app grew to be one of the more popular social media websites, coming in third after Facebook and YouTube, according to a study done by Pew Research Center. (Kevin Murnane, Forbes). Within hours of the photo sharing app’s release, thousands of people downloaded Instagram, and the app passed one million users less than 2 months later. (Daniel Victor, The New York Times). Currently, the app has reached 1 billion monthly active users. (Josh Constine, TechCrunch).

Eighteen months after the release of Instagram’s app, Instagram sold to Facebook for $1 billion; $300 million in cash and the rest in Facebook stock. (Alyson Shontell, Business Insider). Facebook purchased Instagram one month before Facebook’s initial public offering and was Facebook’s largest acquisition at that point. (Mike Isaac, The New York Times).

Currently, Instagram is estimated to be worth over $100 billion dollars and has reached 1 billion monthly active users. (Emily McCormick, Bloomberg; Sarah Frier, Bloomberg). Bloomberg Intelligence has estimated that Instagram alone may account for about 16% of Facebook’s revenue in 2018. (Emily McCormick, Bloomberg).

On September 24, 2018, 8 years after Instagram’s inception, the Founders announced their plan to leave the company. (Kevin Systrom, Instagram Press). Allegedly, the Founders were growing frustrated with Zuckerberg’s increased involvement in Instagram’s day-to-day operations. (Sarah Frier, Bloomberg). In his statement, Kevin Systrom explained that he and Mr. Krieger are ready for their next chapter, and that they’re planning to “explore their curiosity and creativity again.” (Kevin Systrom, Instagram Press). Facebook’s chief executive, Mark Zuckerberg, wished Kevin Systrom and Mike Krieger “all the best” and stated that he is “looking forward to seeing what they build next.” (Mike Isaac, The New York Times).

During their time at Facebook, the Founders were able to use Facebook’s infrastructure and resources to grow Instragram, while keeping the brand separate from Facebook. (Sarah Frier, Bloomberg). With the Founders departure, Instagram will likely integrate more tightly with Facebook, becoming a product division within the larger company instead of an equally independent operation. Id.

The Founders announced their departure shortly after Instagram’s chief operating officer, Marne Levine, transferred to a new position at Facebook as its global head of business development. Id. It is suggested that Levine helped maintain a harmonious relationship between Instagram and Facebook. Id. Additionally, Instagram’s head of public policy, Nicole Jackson Calaco, also left earlier this year. Id.

A source quoted in an article for TechCrunch suggests that Kevin Systrom and Mark Zuckerberg historically got along, but that they had differing opinions on occasions. (Josh Constine, TechCrunch). The source mentioned that as a result of leadership changes within the companies, tensions were mounting this year between Instagram’s Founders and Facebook’s leadership because of Instagram’s loss of autonomy. Id.

While there are some indications that the Founder’s decision to leave Instagram may have stemmed from tensions in leadership between Instagram and Facebook, both Kevin Systrom and Mark Zuckerberg have issued statements that do not indicate tensions, but rather best wishes for future success.