Quick Summary: Sarah Frier’s No Filter (2020) examines how Instagram came to play such an important cultural role in our society. Instagram co-founders Kevin Systrom and Mike Krieger were aware that their product had a significant impact on its users, but they were attempting to avoid the grow-at-all-costs culture.
However, after being acquired by Facebook in 2012 for $1 billion, Instagram continued to grow, and Mark Zuckerberg continued to try to make it more like Facebook. Systrom and Krieger eventually left the company, but their once-insignificant app had taken over the world.
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No Filter Book Summary
The Creation of Instagram
In 2005, Kevin Systrom met Mark Zuckerberg through mutual Stanford University friends. Zuckerberg was working on TheFacebook.com, a popular social network among college students. Zuckerberg wanted to add a picture feature to his platform and asked Systrom if he wanted to work on it. Systrom declined a few days later and went to study in Florence, Italy. He was fascinated by the science behind art and had no desire to work in technology. He chose to intern at Odeo, a podcast startup marketplace in San Francisco.
By the end of 2009, Systrom had created the website Burbn. It allowed users to post what they were doing that day so that their friends could join them. He was interested in pursuing that idea. He met with Steve Anderson, a venture capitalist who offered him $50,000 if he could find a co-founder for the project. Mike Krieger, a Stanford student, eventually joined him.
Burbn was a fun platform, but it wasn’t always useful. Photos, on the other hand, were quickly becoming the next big thing. They decided to create a photo-focused app. People could follow other people and like their shared photos if the photos were square. They chose a white Polaroid camera as the app’s logo and named it “Instagram.” They made it possible for users to share their Instagram photos on Twitter and Facebook, which was an excellent marketing strategy. The app was officially launched on October 6, 2010, and it reached 2 million users six weeks later, six weeks after the December holidays.
The Chaos of Success
It was exhausting to deal with the chaos that came with success. As the number of users increased, more people were required to be hired. Joshua Riedel, an aspiring novelist, and Shayne Sweeney, a young but experienced engineer, were their first two employees.
Instagram’s community and culture were critical components of the product. They decided to organize their own events after being inspired by Twitter’s user-hosted meetups. Riedel, the community manager, hosted the first InstaMeet, where users discussed the app. By January, a few brands had joined the app, including Starbucks and Pepsi. Systrom stated unequivocally that they would not pay anyone or any brand to use Instagram. Snoop Dog was the first celebrity to join shortly after.
The company was rapidly expanding, but the team remained painfully small. They were always together, and they were constantly improving the app, so Sweeney coined the phrase “bug fixes and performance improvements” to explain what was going on. The term quickly spread throughout the industry.
Some users began posting graphic images of suicide attempts, animal abuse, and the glamorization of eating disorders on the app. Krieger set up a separate server where such posts could be safely and legally removed.
Elad Gil, a Twitter employee, proposed acquiring Instagram in early 2012. Gil drafted a term sheet with Twitter’s CFO, Ali Rowghani, for a $500 to $700 million offer. Nobody knows if the offer was even made, but there was no agreement.
Systrom called all Instagram employees one night in April 2012 to inform them of an 8 a.m. meeting the next day. Instagram was being acquired by Facebook for $1 billion after Systrom met with Zuckerberg. Both companies were entering uncharted territory with the acquisition. Facebook had never purchased a product with so many users before, but Zuckerberg assured the public that Instagram would grow on its own.
Instagram was about to close a $50 million venture round at a $500 million valuation during the first week of April. Before Systrom could sign the papers, Zuckerberg called and said he wanted to buy the company and was willing to double the round. Before calling Zuckerberg back, Systrom completed the round. Zuckerberg saw Instagram as a threat and decided to purchase it. While Instagram was not yet generating revenue, it would be simple to integrate Facebook’s ad infrastructure into it.
Systrom’s board was not on board, but Zuckerberg’s was. Systrom explained his reasoning, saying that as Facebook’s stock price rose, so would Instagram’s. Not only would they be eliminating a major competitor, but they would also benefit from Facebook’s infrastructure. The 13 Instagram employees went to Facebook’s headquarters for their first meeting and tour with Zuckerberg. Friends and family members were already congratulating them despite the lack of details about their future jobs and salaries.
A Summer in Limbo
The team spent the weekend in Las Vegas to unwind and celebrate the acquisition. When they returned to work, however, they were met with two pieces of bad news. The first was that governments in the United States and Europe were looking into the deal, and any operations between the two companies would be halted until the deal was approved. The second piece of bad news was that not all of the employees were about to become millionaires. Only Systrom and Krieger received life-changing awards. Other employees’ Instagram stock options would be canceled, and they would be given Facebook restricted stock units instead.
The Federal Trade Commission investigated what the two companies thought of each other, whether they competed, and why the deal was made. The investigation was kept confidential, and no further action was taken. Only state regulators stood in the way of the acquisition after federal approval.
A fairness hearing was held by the California Department of Corporations. They questioned Systrom and inquired about any previous unsuccessful acquisition bids. Systrom stated that they had received no formal offers. The transaction was deemed fair, and the agreement was signed within six months. If Twitter wanted to create drama over their previous offer, they only had to go to the media.
Getting Used to the Acquisition
Facebook’s stock plummeted, and Instagram’s final cash and stock value was $715 million. For the second half of the year, Facebook concentrated on its own product, as Instagram was still losing money.
Instagram and Facebook had opposing viewpoints. While Facebook tailored its experience to a user’s interests, Instagram aimed to introduce new interests to users. Employees at Facebook were permitted to make changes to the codebase as long as the changes resulted in increased growth. Instagram wanted every aspect of the app to be carefully thought out, designed, and implemented, with growth never being the ultimate goal. They were developing an app for humans rather than daily active users.
Zuckerberg told his team to stay out of Instagram’s way. They could only intervene if the company required assistance. However, Facebook changed Instagram’s terms of service in December 2012. Businesses appeared to be able to pay Instagram in order to benefit from a user’s photos, causing a press crisis. In his first blog post, Systrom stated that Instagram did not claim ownership of any of their users’ content. It was clear how little trust people had in Facebook.
The team remained focused on Instagram’s culture rather than its growth. Instagram’s three core values are: community first, simplicity matters, and inspire creativity. Systrom needed to show Facebook that they were valuable. He came up with a few revenue-generating ideas, but Zuckerberg quickly shot them down, telling him to focus on growth for the time being.
The Instagram acquisition caused a ripple effect in the tech industry, with more startups attracting investor interest. When Twitter missed out on Instagram, it purchased Vine, an up-and-coming app that allowed users to post 6-second videos. Following the app’s initial success in 2013, the Instagram team began developing their own video project. The new tool’s launch was also successful, but those who were popular on Vine were the ones who used it the most.
While Systrom was stomping the competition, Zuckerberg was emailing Snapchat’s Evan Spiegel. Snapchat represented everything that Facebook and Instagram did not. It allowed users to send photos to their friends that would vanish 10 seconds after they were opened. This was appealing to teenagers. It was fun sending their friends bad, unedited, and careless pictures; they couldn’t do that on Instagram or Facebook. Spiegel turned down a $3 billion acquisition offer from Zuckerberg and raised $80 million from venture capitalists at a $800 million valuation.
On November 13, 2013, Instagram launched its first advertisement. They had a very different ad experience than Facebook because they only advertised one brand per day. Meanwhile, Snapchat introduced Stories, a new and potentially dangerous feature. Users could now add posts to their Stories that would disappear after 24 hours.
The company was on its way to becoming Instagram’s first true competitor. During this time, Facebook was looking to acquire WhatsApp, a messaging app with end-to-end encryption. Jan Koum, the app’s creator, was promised independence and a seat on Facebook’s board of directors, as well as a $19 billion deal. He agreed, and it appeared that Instagram had been sold too soon.
Instagram and Celebrities
In late 2012, Charles Porch, who managed Facebook’s celebrity relationships, decided that Instagram would be the best place for them. People used Facebook to stay in touch with friends and family, not celebrities. Porch would persuade celebrities to post personal things on their accounts, allowing audiences to connect with them more. He presented his plan to Systrom, who appointed him project manager. Systrom and Porch proposed celebrity verification, which is already available on Twitter. They also began to mingle with celebrities.
Celebrities like the Kardashians began accepting large fees from brands in exchange for promoting products in their posts. Instagram’s team has never financially supported any of its users. They would increase the popularity of an account by featuring it on the @instagram account and the suggested user list. Employees chose these accounts, and there were no real metrics celebrities could use to gain followers.
Unless an Instagram move benefited Facebook, Facebook and Instagram were now completely separate entities. Porch, for example, persuaded actor Channing Tatum to share a photo of his baby on both platforms.
Zuckerberg was concerned about Twitter’s rapid growth. A photo taken at the Oscars in March 2014 of Meryl Streep, Ellen DeGeneres, and other celebrities went viral, receiving over 3 million retweets. Twitter focused on live events and virality, whereas Facebook and Instagram did not.
Porch took advantage of the fact that Instagram was more about pretty pictures at the 2015 Academy Awards. Mark Seliger, a portrait photographer, was hired to set up a studio at the Vanity Fair party. All celebrity photos taken there, including Lady Gaga and Oprah Winfrey, were posted on Instagram.
The Pursuit of the Insta-Worthy
Beginning in early 2015, celebrities raised critical issues with the app that needed to be addressed, including bullying, homophobia, and perfectionism. Instagram’s problem-solving strategy resolved issues on a personal and even individual level. This caused some issues, and only celebrities like Miley Cyrus and Kylie Jenner had their complaints heard by real employees.
Systrom wanted the company to expand but didn’t want to use cheap methods. Zuckerberg had been pleading with Systrom to increase the frequency of Instagram ads. This would eventually generate $1 billion in revenue, but Systrom was concerned that such a move would damage Instagram’s brand. Instagram’s team had six months to devise an ad revenue strategy.
People and businesses were no longer curating their Instagram content by this point. They had begun to plan their lives around their Instagram feed. Coffee shops were focusing on a “Instagrammable” aesthetic, and people were modifying their photos with photo editing apps. The app was now used by half of all American teenagers.
Instagram had become a daily habit in many people’s lives. As a result of this growth, users began to buy fake followers, likes, and comments in order to validate their numbers. Instagram devised a solution, and all accounts suspected of being bots were deleted. Celebrities have lost millions of fans. The team then enabled the posting of non-square photos, a feature that users had long requested.
Facebook was putting more pressure on Instagram and demanding growth, and a new threat was on the horizon. Snapchat suited the need to portray a perfect life.
The Snapchat Problem
Instagram had become so centered on curating posts that average users were no longer posting as frequently. They didn’t see the point in posting pictures that would receive no attention. They felt overshadowed by celebrities and others with larger fan bases. As a result, Instagram created an algorithm that would alter the user’s feed. Posts would no longer be ordered chronologically, with better posts appearing before less interesting ones. Although this resulted in negative feedback, users quickly adapted.
Systrom was pleased to notice celebrities posing and posting a lot on Instagram while attending a red-carpet event. They were, however, promoting their Snapchat accounts, claiming that fans could find more behind-the-scenes content there. This shocked Systrom, who realized Snapchat was a legitimate competitor.
Prior to this event, he was adamantly opposed to adding a “Stories” feature to his app, akin to Snapchat’s. He now realized, however, that it was necessary. Stories launched in August 2016, and while users complained at first, data showed that people were increasingly using the feature. Instagram encouraged celebrities to begin posting stories, and the feature proved popular.
As part of its effort to beat Twitter, Facebook had succeeded in getting more news publishers to post on the platform. Facebook users were discussing the US presidential election in October 2016. After Donald Trump was elected, many people concluded that Facebook had the ability to influence citizens’ opinions about candidates. The most shared posts contained shocking news and headlines, and Trump appeared to have paid Facebook far more than Hillary Clinton. Trump’s ads aimed to collect emails from people, whereas Clinton’s aimed to spread her philosophies.
Instagram was thriving at the time. Stories were so popular that Facebook decided to incorporate them into Messenger and WhatsApp as well. Zuckerberg noticed that people were posting less on Facebook and spending less time on the app as a result. He believed that the app that diverted attention away from Facebook was the one he had purchased and promoted for years – Instagram.
After some drama involving Taylor Swift, haters flooded her social media with snake emojis. Systrom decided to add a feature that would allow users to filter or completely disable comments on their posts.
Zuckerberg asked Systrom at the end of 2017 to add a prominent link on Instagram that would take users to Facebook. He believed that Instagram should begin to give back to its parent company. However, Zuckerberg removed the Facebook link that directed users to Instagram.
Instagram introduced a new comment algorithm in the spring of 2017. The most relevant comments, such as those from relevant or verified accounts, would appear first. People quickly figured out how to gain followers by leaving comments. Comments were now being used to promote oneself. People began to realize that social media features were not designed to benefit them, but rather to control and manipulate their behavior.
In March 2017, regulators notified some brands, celebrities, and influencers that they needed to be explicit about when they were paid for a post. They were unable to conceal a #ad hashtag among others. Instagram developed a tool to automatically convert such posts into advertisements in response to the FTC’s request. That policy was not enforced, and it was clear after a second warning from the FTC that it would be futile.
The Fyre Festival was a well-known example of Instagram deception. Billy McFarland came up with the idea. He paid celebrities like Kendall Jenner to promote it. McFarland promised a private island setting, luxury lodging, and gourmet cuisine. When the guests arrived, it was just a regular beach with a few rudimentary tents. McFarland was imprisoned.
Instagram had become the most effective platform for spreading lies and marketing false products. People, on the other hand, liked Instagram and blamed Facebook for all of its flaws.
The End of an Era
During the winter of 2018, Facebook and Instagram discussed the release of Instagram’s IGTV app, which specialized in longer vertical-format videos. This was seen by Zuckerberg as an opportunity to help Facebook grow. Krieger desired to build it first, ensure its success, and then integrate it into Facebook.
Following Krieger’s approval, Zuckerberg announced that Instagram, WhatsApp, Facebook Messenger, and Facebook itself would now be bundled as a family of apps, with all reporting to Chris Cox, a trusted product executive. Instagram received little attention; everything was focused on WhatsApp. Zuckerberg desired to include advertisements in WhatsApp. Its founders refused and eventually resigned.
On March 17, 2018, it was revealed that Facebook had permitted the developer of a personality quiz app to collect user data, which was then shared with the political consulting firm Cambridge Analytica. Trump was a client of the company, and Facebook had a hand in Trump’s victory. As a result, Zuckerberg has been summoned to testify before Congress on April 10 and 11. He was questioned about the power of Facebook. Legislators were powerless to intervene, and Zuckerberg emerged victorious.
Instagram reached 1 billion users in June. At the same time, the company launched IGTV. Zuckerberg was enraged an hour after the launch because the IGTV logo was too similar to the Facebook Messenger logo. Zuckerberg was still focused solely on Instagram’s threat to Facebook. Systrom was let down, but not surprised. Both Systrom and Krieger announced their departures from the company in late September. Systrom came to the conclusion that working for Zuckerberg was no longer something he wanted to do. Adam Mosseri, one of Facebook’s top executives, has been named CEO of Instagram.
By the end of 2019, Instagram had begun to provide users with more performance analytics, such as how many accounts they had reached and which posts were the most popular. Instagram was beginning to blur the line between person and brand. Krieger became a father after Systrom stopped posting on his Instagram account. Neither attended Instagram’s 9th birthday celebration. Instagram was not a neutral platform. It was meticulously designed to have a significant impact on the lives of its users. The app was now the result of corporate hardship and pride. The true cost of its acquisition was borne by Instagram users.
No Filter Review
Sarah Frier goes into great detail about the inside story of Instagram. She provides any information readers may require, regardless of their familiarity with the platform. She does have a tendency to delve too deeply into celebrity drama that is frequently irrelevant to Instagram’s story, but she always returns smoothly.
About The Author
Sarah Frier is a Bloomberg News technology reporter. She is regarded as an authority on the origins of Instagram, Facebook, and other major technology companies, as well as their current impact on society and the world. The 2020 Financial Times and McKinsey Business Book of the Year Award went to No Filter.
No Filter Quotes
“The team at Odeo was launching a new status update product, called Twttr, pronounced twitter, with Dorsey as its CEO.”
“What should I do. Systrom asked one of his colleagues. You should pick up golf, the colleague suggested.”
“The biggest risk for you is you’re a sole founder, Anderson told Systrom. I usually don’t invest in sole founders.”
“So he presented the idea to them in steps. He explained who Systrom was and what he was working on.”
“The founders at Twitter, for example, were always trying to undermine one another.”
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