The fate of the platform remains uncertain, but one thing is clear: banning it would upturn fundamental principles of democracy.
Facebook CEO Mark Zuckerberg was among the powerful tech executives who testified Wednesday in front of lawmakers regarding their companies' potential antitrust violations.
During the hearing, never-before-seen messages were made public detailing why the cofounders of Instagram, Kevin Systrom and Mike Krieger, felt compelled to sell their app to Facebook in 2012. Systrom and early Instagram investor Matt Cohler discussed what to tell Zuckerberg about the photo app's future plans.
In the text exchange, Systrom expresses concern about sending Zuckerberg into "destroy mode" if he turned down an acquisition offer, and being unable to "escape the wrath of Mark."
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Never-before-seen text messages from 2012 show just how careful Instagram cofounders felt they needed to be in dealing with the "wrath" of Mark Zuckerberg in the months before Facebook acquired the photo-sharing app for $1 billion.
A text exchange between Instagram cofounder Kevin Systrom and early investor Matt Cohler, then a partner at Benchmark, show the two strategizing how much to disclose to Zuckerberg about the photo-sharing app's future plans, and the cofounders' decision whether to get acquired or continue on independently. In the text conversation, Systrom voices his concerns to Cohler about possibly sending Zuckerberg into "destroy mode" or encountering "the wrath of Mark" if the Instagram cofounders were to rebuff Facebook's interest in buying the app.
The text messages were made public Wednesday as Zuckerberg — as well as the CEOs of Apple, Google, and Amazon — appeared in front of the House Judiciary's antitrust subcommittee to answer lawmakers' questions about any potential violations of antitrust regulations. The exchange between Systrom and Cohler was just one of a trove of documents the House subcommittee made public during Wednesday's hearing to demonstrate possible anticompetitive practices by the four big US tech companies.
Although Facebook's purchases of Instagram in 2012 and WhatsApp in 2014 weren't challenged at the time, lawmakers at Wednesday's hearing heavily scrutinized the acquisitions. Some representatives argued that Facebook's app acquisitions and clones of other platforms' features — like Snapchat's Stories and, most recently, TikTok — were evidence of monopolistic or anticompetitive behavior.
The committee also published several email threads and online chat logs showing conversations that took place among Zuckerberg and various Facebook executives and employees to demonstrate the company's mindset during Instagram's $1 billion acquisition.
By the start of 2012, Facebook was touting that its company comprised 95% of the social media market. However, Instagram was rapidly threatening that lead: In March 2012, Instagram's average daily users was growing at a rate of more than 1,700% week-over-week and 9.2 million percent month-over-month, according to documents published Wednesday.
In emails Zuckerberg sent in 2012, the CEO calls Instagram a "threat," and reasons that buying Instagram would be a way to successfully "neutralize" its success. Zuckerberg told colleagues that Instagram "can hurt us meaningfully without becoming a huge business," and that acquiring Instagram would be "buying" time for the company.
But Zuckerberg's plans to take on Instagram didn't come as a surprise to the app's cofounders, as is apparent by the text exchange between Systrom and Cohler. Systrom said he feared turning down an acquisition offer from Facebook would send Zuckerberg into "destroy mode" — a concern that Cohler affirmed.
"Mark doesn't react emotionally, he reacts based on competition," Systrom later writes to Cohler. "Bottom line I don't think we'll ever escape the wrath of [M]ark. It just depends how long we avoid it."
Just two months after this conversation took place, Facebook acquired Instagram for $1 billion in April 2012.
In response to questions from Rep. Jerry Nadler at Wednesday's hearing, Zuckerberg acknowledged the company viewed Instagram "as a competitor and a complement to our services" in 2012. The chair of the big tech hearing, Rep. David Cicilline, later told Axios that Zuckerberg's testimony proved Facebook displayed "classic monopoly behavior" and should be broke up.
However, Zuckerberg also reasoned that Facebook had simply "adapted features" from competitors in response to lawmakers' grilling about whether it cloned competitors' products in order to maintain its social media dominance. Zuckerberg also argued that Facebook still faces competition from platforms like YouTube and TikTok.
The Facebook CEO also disagreed with lawmakers' characterization that his conversations with Facebook executives regarding acquisition targets were viewed as a threat "in any way."SEE ALSO: Facebook, Google, and the US government all have their own reasons to make you believe that TikTok is unsafe and scary — and they're all self-serving
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Here’s a look at how Mark Zuckerberg plotted the Instagram acquisition. Plus: Inside Amazon’s plan to take down Diapers.com.
The House Judiciary Committee has published documents relating to its tech antitrust investigation, including a copy of a conversation between Instagram cofounder and Benchmark investor Matt Cohler.
The conversation — which took place in 2012, prior to Facebook's $1 billion acquisition of Instagram — provides a rare glimpse into the mind of a startup founder when a would-be buyer comes calling.
You can read the full conversation below, in which Systrom wonders whether Zuckerberg will "go into destroy mode" if Instagram chose to stay independent.
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The tech antitrust hearing has revealed a number of surprising pieces of information about the businesses of Amazon, Apple, Facebook, and Google. But it's also afforded a peek into the mindset of tech founders, offering a glimpse into some never-before-seen conversations.
The House Committee on the Judiciary on Wednesday published documents relating to its antitrust investigation into some of the biggest companies in tech, including a trove of emails between Zuckerberg and employees, as well as messages related to Facebook's business.
One such message exchange is between two individuals whose names are redacted, but whom the Judiciary Committee's website identifies as Instagram cofounder Kevin Systrom and Benchmark investor Matt Cohler. The conversation revealed Systrom's mindset at a time when Instagram was will an independent company.
The exchange took place in 2012, before Instagram was acquired by Facebook for $1 billion. While it's only one conversation, it provides a rare look into the mind of a startup founder as he weighs a potential acquisition, including whether Zuckerberg would "go into destroy mode" if Systrom turned down an offer.
Read the full conversation between Systrom and Cohler below:
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Instagram co-founder Kevin Systrom worried that Mark Zuckerberg would go into "destroy mode" if he didn't sell the company to Facebook, according to records of his text messages.
Instagram investor Matt Cohler warned that Zuckerberg would "go harder into destroy mode" if Instagram turned down the acquisition offer.
The exchange was published by the House Judiciary Committee as part of its historic antitrust hearing Wednesday where Zuckerberg faced questions over Facebook's purchases of competitors.
Regulators didn't challenge the Instagram acquisition at the time, but the deal has since drawn scrutiny from both regulators and politicians who say it constituted anti-competitive behavior.
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Mark Zuckerberg spent Wednesday trying to persuade lawmakers that Facebook's acquisitions and cloning of competitors' products and features haven't amounted to monopolistic behavior, and that it has plenty of competition.
But when Zuckerberg first expressed interest in buying Instagram in 2012, cofounder Kevin Systrom didn't appear confident about what would happen if he opted to remain independent.
"Will [Zuckerberg] go into destroy mode if I say no [to an acquisition deal]?" Systrom asked in a message to Benchmark Capital's Matt Cohler, according to documents published by the House Judiciary Committee as part of its antitrust hearing on Wednesday.
"Probably," replied Cohler, an early Facebook employee-turned-VC who had invested in Instagram and was on its board of directors.
Cohler also warned that Zuckerberg was unlikely to be deterred by the fact that Instagram was keen on raising additional startup funding.
"He'll go harder into destroy mode," Cohler told Systrom.
The names in the text transcript are redacted, but the committee's website identifies the two participants in the conversation as Systrom and Cohler.
"Mark doesn't react emotionally, he reacts based on competition"
Systrom and Cohler went on to strategize around how to best respond to Zuckerberg's probe, weighing options like downplaying Instagram's strength and saying the product wouldn't be a good fit or able to succeed within Facebook.
But two things they seemed to agree on: Zuckerberg was most worried about Instagram getting bought up by Twitter, and they were worried about Zuckerberg trying to crush Instagram if they refused to sell.
"If i make the 'leave instagram alone for Facebook's sake' argument, [Zuckerberg] will conclude that it's best to crush instagram," Cohler said, implying that they wouldn't be able to fend off Facebook just by floating the possibility of selling to Twitter.
Ultimately, Systrom and Cohler concluded during the text exchange that Instagram needed to keep raising money and they needed to convince Zuckerberg that they weren't a threat to Facebook.
"Mark doesn't react emotionally, he reacts based on competition," Systrom said, "that's why i think signaling no competition is good."
"Bottom line I don't think we'll ever escape the wrath of mark," he added. "It just depends how long we avoid it."
Facebook eventually got its way just two months after the exchange, buying Instagram for $1 billion in April 2012. The price tag seemed massive at the time, but Instagram reportedly brought in $20 billion in revenue for Facebook last year alone and has the second-most number of monthly users in the US, according to eMarketer.
Facebook's acquisition of Instagram has since come under scrutiny from regulators and politicians who argue it amounted to anti-competitive practices. Zuckerberg faced multiple questions on the topic Wednesday, and argued that Facebook still faces lots of competition.
"The most popular messaging service in the US is iMessage," Zuckerberg told lawmakers. "The fastest-growing app is TikTok. The most popular app for video is YouTube. The fastest growing ads platform is Amazon. The largest ads platform is Google. And for every dollar spent on advertising in the US, less than 10 cents is spent with us."
Still, the committee obtained large numbers of documents from Facebook and others companies as part of its antitrust investigation, including emails where Zuckerberg said he viewed Instagram as a significant threat to Facebook's business before acquiring it.Join the conversation about this story » NOW WATCH: Why Pikes Peak is the most dangerous racetrack in America
Antitrust panel says the messages show Zuckerberg trying to buy out his competition
It's been a rocky few months for Uber.For the three-month period ended June 30, Uber posted a worse-than-expected loss of $4.32 per share.That's more than the $3.19 per share loss analysts surveyed by Yahoo had forecast.They reached 100 million per month for the first time ever, offering insight into how often consumers use the company's services.Ryan Graves, Uber's first employee and first CEO, stepped down from the company's board of directors in May.And then two more board members, entrepreneur Arianna Huffington and venture capital investor Matt Cohler, resigned last month.
Two of Uber's prominent board members are stepping down from the company's board of directors, according to filings with the US Securities and Exchange Commission on Wednesday evening: entrepreneur Arianna Huffington and Matt Cohler, a general partner at venture capital firm Benchmark.Huffington also tweeted the news, saying her decision came about because of her increasing commitments as CEO of Thrive, the health and wellness company she founded."I will no longer be able to give my board duties the attention they deserve," she said."There were no disagreements whatsoever with the company that led to this decision," Huffington wrote in an email to Uber's board.With the departures of Huffington and Cohler, Uber has lost three board members in the past two months.Ryan Graves, Uber's first CEO, stepped down from the board in late May.
Uber has lost two of its board members today.Arianna Huffington, CEO at Thrive Global, and Benchmark General Partner Matt Cohler‘s resignations from the board went into effect today, according to two Uber filings with the SEC.“Given Thrive’s growth, it has become clear to me that I will no longer be able to give my Uber board duties the attention they deserve, so I will be stepping down,” Huffington said.“It has been an unforgettable three-year ride, and I’m grateful to have been able to work alongside my fellow board members and witness the incredible work of thousands of Uber employees around the world.”Cohler, who notified Uber of his resignation yesterday, said he and his partners “have had the privilege of being part of the Uber journey since the Series A nearly a decade ago.I’m thrilled with the company’s position, excited for the road ahead, and extend my deepest thanks to all of Uber’s past and present employees, directors, drivers, and customers.”
Despite Uber co-founder Travis Kalanick wanting to be part of the company going public, the company’s board is considering not letting Kalanick ring the opening bell on May 10, Uber’s first day of trading, Axios reports.Kalanick also wants to bring his dad, The New York Times reports.Additionally, Kalanick’s fellow co-founders Ryan Graves and Garrett Camp may not be allowed on the balcony to ring the bell.Uber would not be where it is today without Kalanick, but him being there would surely be a reminder of Uber’s rocky past.Still, Benchmark partner Matt Cohler wants Kalanick and his co-founders to be there, according to Axios.Instead of joining Uber CEO Dara Khosrowshahi and other Uber executives on the balcony, Kalanick will only be able to be on the New York Stock Exchange floor with the company’s other board members.
Now when it comes to the point, how does Tinder Make Money, got answered after two years of operations and when the company launched Tinder Plus.Although knowing about Revenue Model of Tinder, How does Tinder Work can make a difference in understanding the Tinder Business Model.The application additionally won TechCrunch’s Crunchie Award for “Best New Startup of 2013” as a result of its remarkable business and working model.The user can log in through Facebook id and the information of a user is taken from Facebook like work, college, interests and other basic information.Tinder Plus, Tinder’s recently stamped membership-based service, will include opt-in features for an expense while keeping up the application’s free service for those uninterested in a premium account.One such extra, Passport, will open membership-based clients to more matches by disposing of land confinements, giving access to profiles not based clients constrained to the client’s area (the current model limits clients to profiles inside a 120-mile territory).
VC powerhouse Benchmark has filed to raise $425 million for its ninth flagship fund.While other firms close billion-dollar venture funds despite a history of smaller fundraises, Benchmark is sticking to its guns.The firm, known for its early bets on Twitter, Uber, Snap and WeWork, hasn’t fallen victim to the SoftBank effect.Longtime Benchmark general partners Bill Gurley and Peter Fenton are listed on the filing alongside three newer members of the partnership.Benchmark staples Mitch Lasky and Matt Cohler, who joined the firm in 2007 and 2008, respectively, are noticeably absent.Lasky’s departure doesn’t come as a shock.
In June 2014, two years after Facebook bought Instagram, I visited Instagram cofounders Kevin Systrom and Mike Krieger to see how things were going.“We’re just kind of a storybook example.”In September 2012, when Systrom and Krieger had first brought the team to Menlo Park, the whole hasty acquisition seemed a little crazy.Back then, the billion dollars that Facebook had agreed to pay for Instagram seemed like an outrageous sum of money.Especially when the acquiring company had just gone public four months earlier, and was off to a rocky start.Earlier this year, Instagram announced that it had finally hit a billion users worldwide.
As Uber Technologies Inc. works to finalize a potential multibillion-dollar investment deal with Japan’s SoftBank Group Corp. 9984 -0.92% , one of the ride-hailing giant’s earliest and biggest shareholders has indicated it doesn’t intend to sell.The opposition by Benchmark Capital is complicating a proposal by SoftBank and its $93 billion tech-focused Vision Fund, along with partners, to buy 17% to 22% of Uber—mostly through purchasing shares from existing shareholders.And Benchmark’s representative on Uber’s board, Matt Cohler, was the only one of Uber’s eight directors to vote against a term sheet granting SoftBank exclusive rights to an investment deal, the people said.The proposed investment by the SoftBank group, which could total as much as $10 billion, hinges on getting enough existing investors to sell their shares at what amounts to a 30% discount to Uber’s most recent valuation of nearly $70 billion, people familiar with the terms said.In addition to the stake, SoftBank is also seeking two board seats.The Wall Street Journal reported last week that resistance from some investors was impeding the SoftBank deal talks.