When Instagram launched its first app in October 2010, it did not strike most people as the kind of startup that would be acquired for $1 billion. The app had almost 200,000 users within the first week. By February, it had 1.75 million users, and three months later that number had jumped to 4 million.
By the time Facebook Inc. acquired Instagram for $1 billion on Monday, the startup’s iPhone app had been downloaded 30 million times. In the same week, its six-day-old Android application hit the 5 million mark.
Meanwhile, Instagram’s valuation has shot up with similarly impressive speed. Facebook acquired Instagram just as the startup was closing a round of funding at a $500 million valuation. Instagram’s $1 billion price tag means it literally doubled its valuation within a week.