Case Study: Behind Instagram’s Growth

"The morning of Instagram's launch." - Rod Begbie

This is an analysis based on publicly available data by Lukas Fittl, who just joined Spark59 as our European outreach.

All the media are abuzz with the news of Facebook acquiring Instagram for $1 billion. Lets dive into what they actually did:

Zoom-in pivot:
Instagram was initially “Burbn”, a check-in app where you could also add photos. They launched after 8 months of private beta, and saw little engagement from customers – apart from photo sharing, which was used actively. At some point they actually sat down and built a prototype of “just photos” – but discarded that again without launching it.

Few weeks later, on a vacation, Kevin Systrom saw someone use a photo app with filters (Hipstamatic was already popular) and wondered why none of these apps had social functionality. And all the existing social photo apps made ugly photos. From that he and Mike Krieger built a simplistic social photo app with just one excellent filter: Instagram.

“If I could give any advice: Stay away from this private beta stuff. Put it out there, find the people that are vocal about it, put it in their hands and listen to what they’re excited about.”
- Foundation 16: Kevin Systrom

They focused on one “must have” use case:
Sharing beautiful photos with your friends.

They split it up into three problems to be solved:

  1. Making Photos Beautiful
    (based on their observation of filter apps)
  2. Allowing You To Share Them on Multiple Networks
    (engineering for viral growth)
  3. Making Uploads Go Really Quickly
    (making the user experience even better)

“We focused on three – we weren’t trying to reinvent the world of photography. We focused on these three humble problems. And thats what turned Instagram from yet another network tackling photos, into a network people used.”
- Foundation 16: Kevin Systrom

Build-Measure-Learn & Cohort Analysis:
Instagram kept a nimble engineering team, and delayed building a proper company. And they were successful because of it. They kept experimenting & improving their metrics, using cohort analysis to stay focused and keep questioning the status quo – not to be distracted by vanity metrics.

“The people who signed up in the first month: Are they still using it today? Often in social startups you’ll see people sign up, use it for a couple of months, and then never use it again. This weird effect where, because your sign-up rate is so high, your active users seems to stay pretty much the same. Like a revolving door.”
Kevin Systrom at TC Disrupt 2011

When you dive into the details, Instagram tells a fascinating story of focused engineers innovating in small batches and delivering one superb user experience. And they were rewarded for it.

Lets talk more about what actually makes the difference, and not blindly build the “Instagram for X”.

  • http://twitter.com/DipakPatel Dipak M. Patel

    Sometimes you need vacation to find your “it”!

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  • http://www.ashmaurya.com/ Ash Maurya

    You always need to build in time to step away from the problem.

    “People don’t come to Toyota to work. They come here to think”
    - Taiichi Ohno

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  • http://www.zoomis.com/ Daman Bahner

    It’s always nice to have the narrative after the success to isolate what different directions were followed before they found what worked.

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  • http://www.facebook.com/charkrid Charkrid Thanhachartyothin

    I think the problem instagram solved is on the community side as well. 
    I’m another person who ‘retention’ because I would like to come back to see beautiful photos rather than sharing photos. That is the reason why many photo-decor apps that were a lot better than instagram cannot match their growth. (network effect unfair advantage)4. They help people discover beautiful photos from friends and artists they like. 

    ========================
    As a fan of your book, I would like to here more update on the ‘running lean’ for building social apps or community apps. 

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  • http://twitter.com/sam1meta samuel a villegas

    Good One.
    Lets See how Instagram-FBook manage the reputation crisis created after their announced/rectified changes on policies to commercialize content shared over Instagram . Specially lets see what finally is going on with the collective legal actions taken in california against them. A good sample about the “Operational” management mistakes after a sucessfull Start up stage phase?. Cheers