Instagram Is Worth Over $100 Billion [Chart]
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How Much Is Instagram Worth? Could Easily Be Worth $100 Billion (100x What Facebook Paid For It)
Instagram launched in 2010 and was acquired by Facebook in February 2012 for a then astounding $1 billion. Since acquisition, Instagram has grown at a blistering pace and is on track to join the select few social media platforms with over one billion users.
In 2012, Instagram had 30 million users. Today, the app boasts 800 million monthly active users and is growing at a pace of 653,595 users every day. The photo-sharing app has come a long way since Facebook bought it, begging the question: What is Instagram actually worth? Using Snapchat as a comparison company, our research team estimates that Instagram's value is over $100 billion.
With an estimated value of $102 billion, Instagram is worth 5x as much as Snapchat and 6x as much as Twitter. However, its parent company dwarfs all other social platforms. As of December 11th, Facebook has a $523 billion market cap, making Facebook worth roughly 27x as much as Snapchat and 33x as much as Twitter.
How Much Is Instagram Worth? (Methodology)
Since Instagram is owned by Facebook, there is no public information on its worth as an individual company. In order to estimate Instagram’s worth, our research team utilized the following methodology:
Then, we applied Snapchat’s worth per daily active user to Instagram’s 500 million daily active users to estimate Instagram’s market cap. Through this calculation, we estimated Instagram’s worth to be $54 billion.
We applied a multiplier of 1.9 to this figure to account for differences in Instagram and Snapchat’s user growth rates. The multiplier was calculated by comparing Snapchat and Instagram’s quarterly user growth rates in Q2 and Q3 of 2017 and then discounting by 25%.
With the multiplier applied, our final estimate of Instagram’s market cap is $102 billion, over 100 times the price Facebook paid for it.
How Does Instagram's Worth Compare To Other Major Corporations & Social Platforms?
For additional perspective, we've also created a chart comparing Instagram's value to a handful of Fortune 500 companies. At $102 billion, Instagram is worth substantially more than many major American companies, including Nike, Goldman Sachs, American Express, Netflix, and General Motors.
How Has Instagram Changed Since Facebook Acquired It?
What started as a simple photo sharing app is now one of the most popular social media apps in the world. Since Facebook acquired it in 2012, Instagram has experienced a hundredfold increase in value, added 770 million users, and transformed from an app for posting photos to a full-fledged social media community and advertising channel.
In the past 5 years, Instagram has added a plethora of features including video posts, direct messaging, Stories, live video, multi-image posts, and polls. New features have brought new opportunities for users to interact with friends, influencers, and brands.
Arguably, no Instagram update has matched the success of Instagram Stories. In just shy of one and a half years, the feature has amassed a whopping 300 million daily users. As Instagram Stories succeeds, competing social media apps are suffering. In the past six months, influencers decreased their usage of Snapchat Stories by 33% while using Instagram Stories 2X more. These metrics are a clear indicator of Instagram’s dominance in the social media industry.
Related Post: How Many People Use Instagram Stories? [Growth Chart]
What Does Instagram’s Worth Mean For The Influencer Marketing Industry?
Instagram has become a prominent platform for social media marketing and with $1 billion spent on Instagram influencers in 2017, Instagram will continue to be a huge player in the influencer marketing industry for years to come. As of 2016, 9.7 million Instagram posts had been generated with the hashtags #ad, #sponsored, #spon, and #sp, a number that’s projected to rise to 32.3 million by 2019.
Instagram’s enormous worth is a testament to its popularity and gives brands confidence that it’s a platform worth advertising on. In November, Instagram announced that 25 million business accounts exist on the platform, which shows that brands are using the platform both for paid influencer campaigns and to organically boost brand awareness. For marketers, Instagram is one of the premier social media platforms to implement sponsored advertising campaigns with influencers.
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December 15, 2017 By Mediakix Team