April 10th, 2012

Instragram Acquisition is Huge for Mobile-Only Entrepreneurs

Perhaps you’ve heard of Instagram, the app wunderkind that fetched a billi? If you are a maker of mobile apps, I don’t care how much h8 you have for facebook, you should be celebrating right now.

For those of us who dream about creating fantastic and other-worldly experiences on a small screen, who are more psyched about the magic in our pockets than clunkers on our desks, this is perhaps the best thing to happen to the app ecosystem since Apple opened up the app store in 2008. Watershed.

I am making this assertion completely in earnest. Even though momentum has been building in the mobile space, there has been a severe lack of validation around the value of mobile-only (or “mobile-first” depending on your buzzword preferences) businesses until now. Engagement numbers are growing like crazy across the board, and truly sublime, engaging products are lacking. Creating a wonderful mobile experience should no longer be an afterthought or a secondary priority.

Over the past four years, our collective understanding of mobile product development has certainly matured, but if anything this should be a reminder of how much more is left to explore. Consider this – the first great exit in the mobile space is an app that has essentially two features: take a photo, add a filter. (Browse, export, and follow are, I would argue, secondary non-core features).

There have been several billion dollar companies whose mobile offerings added to their value (Pandora, Zynga, Yelp), but I can’t think of another company that sold/IPO-ed for a billion dollars with a web offering that literally consisted of a splash page and individual pages only accessible if you had the exact URL.

I remember talking to investors during the summer of 2010 when I was working on a mobile chat application. The question I received most often was how we thought we could even build a company that existed only on mobile. A few months later, Instagram launched.

We all have a lot to learn, but the sort of momentum that will follow this acquisition will certainly drive a ton of interesting innovation in the space. It will also pave the way for scammers and assholes, but they too contribute to innovation in their own way.

I am pretty ambivalent about the acquisition itself – so long as the dreaded “login with facebook” doesn’t appear on the Instagram login screen I think it’s a win/win/win for everyone involved.

The biggest winner of all though is the humble mobile developer/designer who has known all along that this ish is the future, and has been honing his/her craft this whole time. Can’t wait to see what happens next.