Instagram raises $7 million from Benchmark
Photo sharing application attracts funding from Jack Dorsey, Adam D'Angelo and Chris Sacca
Instagram, everyone’s favorite filtered photo sharing app, announced Wednesday that it has raised a $7 million round led by Matt Cohler from Benchmark Capital with participation from big-name individual investors: Jack Dorsey, Twitter co-founder and CEO of Square; Adam D’Angelo, former Facebook CTO and co-founder of Quora; and Chris Sacca, former Google employee and Twitter investor. Seed-stage investor Steve Anderson of Baseline Ventures also participated.Since launching four months ago, Instagram has seen over 1.75 million people register for the service, 78 million likes doled out by users, and over a half million tags in under a week. Instagram had hit one million users in December, so it looks like their growth is stable, though not necessarily phenomenal. The service sees 290,000 photos posted per day, but the announcement doesn’t say how many photos have been uploaded in total.
“At Instagram, the depth of our ambition lies in the goal to change the way we see the world – to connect people from near and far and enable anyone with a camera to tell their story through a rich visual dialogue,” writes Instagram CEO Kevin Systrom on the company blog.
Of course, using a camera to tell a story “through a rich visual dialogue” is arguably a lot easier when you can shoot video, but Instagram still shows no outward signs of preparing a video tool for launch. If they did enter the space, however, they’d likely steal a lot of potential users from smaller, similar apps like iSupr8, a vintage video app we featured last month.
“Our new capital,” Systrom continues, “will also allow us to scale to the opportunity we've been handed across a variety of platforms on mobile and the web. We've got some groundbreaking stuff in the pipeline that changes the way we see and consume what's happening in our world.”
As a company, Instagram has doubled its team from two to four, but it’s trying to stay lean and efficient. Still, according to the company’s job page, they’re looking for a couple new hires: an iPhone software engineer and a “visual & experience” designer.
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What is Twitter?
Twitter is an online information network that allows anyone with an account to post 140 character messages, called tweets. It is free to sign up. Users then follow other accounts which they are interested in, and view the tweets of everyone they follow in their "timeline." Most Twitter accounts are public, where one does not need to approve a request to follow, or need to follow back. This makes Twitter a powerful "one to many" broadcast platform where individuals, companies or organizations can reach millions of followers with a single message. Twitter is accessible from Twitter.com, our mobile website, SMS, our mobile apps for iPhone, Android, Blackberry, our iPad application, or 3rd party clients built by outside developers using our API. Twitter accounts can also be private, where the owner must approve follower requests.
Where did the idea for Twitter come from?
Twitter started as an internal project within the podcasting company Odeo. Jack Dorsey, and engineer, had long been interested in status updates. Jack developed the idea, along with Biz Stone, and the first prototype was built in two weeks in March 2006 and launched publicly in August of 2006. The service grew popular very quickly and it soon made sense for Twitter to move outside of Odea. In May 2007, Twitter Inc was founded.
How is Twitter built?
Our engineering team works with a web application framework called Ruby on Rails. We all work on Apple computers except for testing purposes.
We built Twitter using Ruby on Rails because it allows us to work quickly and easily--our team likes to deploy features and changes multiple times per day. Rails provides skeleton code frameworks so we don't have to re-invent the wheel every time we want to add something simple like a sign in form or a picture upload feature.
How do you make money from Twitter?
There are a few ways that Twitter makes money. We have licensing deals in place with Google, Yahoo!, and Microsoft's Bing to give them access to the "firehose" - a stream of tweets so that they can more easily incorporate those tweets into their search results.
In Summer 2010, we launched our Promoted Tweets product. Promoted Tweets are a special kind of tweet which appear at the top of search results within Twitter.com, if a company has bid on that keyword. Unlike search results in search engines, Promoted Tweets are normal tweets from a business, so they are as interactive as any other tweet - you can @reply, favorite or retweet a Promoted Tweet.
At the same time, we launched Promoted Trends, where companies can place a trend (clearly marked Promoted) within Twitter's Trending Topics. These are especially effective for upcoming launches, like a movie or album release.
Lastly, we started a Twitter account called @earlybird where we partner with other companies to provide users with a special, short-term deal. For example, we partnered with Virgin America for a special day of fares on Virginamerica.com that were only accessible through the link in the @earlybird tweet.
What's next for Twitter?
We continue to focus on building a product that provides value for users.
We're building Twitter, Inc into a successful, revenue-generating company that attracts world-class talent with an inspiring culture and attitude towards doing business.