Facebook-owned Instagram would now reportedly be worth $US100 billion as a standalone company, according to an analysis from Bloomberg Intelligence – more than double its valuation by Citigroup back in 2014, and far more than many expected it to be worth back when Facebook acquired it for $US1 billion back in 2012.
The analysis comes just a few days after Instagram announced it reached 1 billion monthly active users – a number Bloomberg expects to double within the next five years. Its users are relatively young, making them particularly attractive to advertisers, and eMarketer predicts that the platform could account for about 16% of Facebook’s total revenue in the next year alone.
If that valuation is accurate, it means Facebook managed a return 100 times its initial investment in as little as six years, and as this chart from Statista shows, it has little to do with sheer luck. Facebook’s acquisitions (Instagram, WhatsApp) and homegrown platforms (Facebook, Messenger) far exceed outside social media platforms in terms of popularity, meaning its social media dominance is more likely a result of its superior understanding of the industry.
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