Instagram’s Buyout: No Bubble to See Here

April 13th, 2012 § 0 comments

At one employee for every 2.07 million users Instagram has an amazing employee to user ratio. This means that $1 Billion works out to $28.57 per user which isn’t too bad. When you look at it from a per employee perspective things get crazy though.

If split equally, each of Instagram’s 13 employees would make nearly $77 million (though Wired’s Mike Isaac reported exclusively that CEO Kevin Systrom and co-founder Mike Krieger would take home $500 million themselves alone).
Some would point to this as a sign of a bubble, but I think it’s more likely it just reflects the incredible scalability of modern app architectures. Using EC2 and solid monitoring, Instagram can quickly scale up to support a million new users overnight with very little additional engineering effort.

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