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Season 4, Episode 3: Instagram Revisited (with Emily White)

Season 4, Episode 3: Instagram Revisited (with Emily White)

Tue, 26 Feb 2019 03:28

We enter the wayback machine and revisit the subject of Acquired’s second ever episode, Facebook’s bombshell 2012 acquisition of Instagram — this time with the help of then-Facebook executive Emily White, who moved over post-acquisition to become Instagram’s first business head. Together with Kevin and Mike, Emily helped build Instagram's business model, which today accounts for nearly 1/4 of all of Facebook’s revenue. Is this still Acquired’s canonical A+ with an extra 3.5 years of hindsight? Spoiler alert: yes.

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I can't believe that InstaWalk tours were a thing. Like Facebook employees were led around campus to use Instagram and take pictures of things after the acquisition to learn how to use it. Ha ha. Welcome to season 4 episode 3 of Acquired, the podcast about technology, acquisitions and IPOs. I'm Ben Gilbert. I'm David Rezenthal. And we are your hosts. On our second episode ever, way back in 2015, we covered Facebook's acquisition of Instagram. And in fact, it's the canonical example of an A-plus that we use on our show. So today we'll dive into the integration itself, how Facebook spent a billion dollars to take something from zero revenue to an app responsible for almost a quarter of all of their revenue today. And we are super. Yeah, right. We are super lucky to be joined by the one and only Emily White, who played an important role in making this all happen. So who is Emily? So Emily today is a venture investor and the president of Anthos Capital in Los Angeles. But previously in her career was a longtime executive at Google, where she joined very early pre-IPO. She worked with Cheryl Sandberg for 10 years, and she then continued to work for Cheryl by moving to Facebook in 2010. And then the topic of today's episode joined Instagram post acquisition as their first business executive. She was tasked with building out the business model, which spoiler, she did a pretty good job, and then became COO of SNAP before transitioning full-time over to what David wrote in the notes as the dark side of investing. And now sits on the boards of Lulu Lemon, Greco, Honey, Hyperloop One, and the X Prize. Welcome, Emily, and thank you so much for joining us. Thank you for having me. Yeah, you bet. So Emily, I think there's a good chance that you were the only person in the world who has worked at Google, Facebook, Instagram, and SNAP. Do you know if that's true? I think that's true. At least when I left SNAP, that was true. I can't think of anyone else who's done all of those. I brought a couple of folks from Facebook with me, but yeah. I know. It's a pretty exclusive vendegraing on there. If I'm good at one thing, it's seeing around corners. Yeah, but. Well, definitely get into that in the show. I think it's been pretty apparent from your journey. So listeners, you know that a few months ago, we started our limited partner program for folks that want to go deeper on technology, startups, and other VC topics with us. So for LPs, we will have an additional segment with Emily after this episode, where we'll cover what Emily and Anthos are looking for in their investments, what it was like to work with Cheryl Sandberg and her experience serving on public company boards. And if you would like to become a prestigious acquired limited partner, you can do so by clicking the link in the show notes or going to slash acquired. Our presenting sponsor for this episode is not a sponsor, but another podcast that we love and want to recommend called the Founders podcast. We have seen dozens of tweets that say something like my favorite podcast is acquired and Founders. So we knew there's a natural fit. We know the host of Founders. Well, David Senra. Hi, David. Hey, Ben. Hey, David. Thank you for joining us. Thank you for having me. I like how they group us together. And then they say it's like the best curriculum for founders and executives. It really is. We use your show for research a lot. I listened to your episode of the story of Achaumarita before we did our Sony episode and it's this incredible primer. You know, he's actually a good example of why people listen to Founders until acquired because all of history's greatest entrepreneurs and investors, they had deep historical knowledge about the work that came before them. So like the founder of Sony, who did he influence? Steve Jobs talked about him over and over again if you do the research to him. But I think this is one of the reasons why people love both of our shows and there's such good compliments. It's not acquired. We focus on company histories. You tell the histories of the individual people. You're the people version of acquired and where the company version of founders. Listeners, the other fun thing to note is David will hit a topic from a bunch of different angles. So I just listened to an episode on Edwin Land from a biography that David did. David, it was the third, fourth time you've done Polaroid. I've read five biographies of Edwin Land and I think I've made eight episodes of them. Because in my opinion, the greatest entrepreneur to ever do it, my favorite entrepreneur personally is Steve Jobs. And if you go back and listen to like a 20 year old Steve Jobs, he's talking about Edwin Land's my hero. So the reason I did that is because I want to find out like I have my heroes who were their heroes. And the beauty of this is the people may die, but the ideas never do. And so Edwin Land had passed away way before the apex of Apple, but Steve was still able to use those ideas. And now he's gone and we can use those ideas. And so I think what requires doing what a founder trying to do as well is find the best ideas in history and push them down to generations. Make sure they're not lost history. I love that. Well listeners, go check out the founders podcast after this episode. You can search for it in any podcast player. Lots of companies that David covers that we have yet to dive into here on acquired. So for more indulgence on companies and founders, go check it out. All right, David, it is time to do what you do best. Take us in set the scene. What was happening in the world and how did this deal go down? Well, it's so funny. You know, of course we listen to episode two of acquired in preparation for today. It's a little rough. It's a little rough. And we realized there was one glaring thing missing from it, which was no history in facts. Today, we're going to do a brief history in facts. And then we're going to get to the meat of today's episode, which is talking with Emily about building the business model at Instagram. But to start quickly and make up for the lack of this in episode two, we're going to go back to a very specific time and very specific place in history, which is Friday, April 6th, 2012 at Mark Zuckerberg's house in Menlo Park. Actually, it's in Palo Alto, California. I remember driving by many times. Facebook is one month away from its IPO road show. Its legendary IPO process is about to kick off. They're planning to raise $10 billion in one of the largest IPOs ever, hoping for about $100 billion valuation. The company is a buzz. Everyone is working like crazy. And it's actually, it is Friday, April 6th. It is good Friday. Easter is on Sunday. But I suspect Emily can correct us. Tell us if this is true or not. Everybody's probably ready to work through the weekend anyway, because I imagine this is a pretty intense time at the company, right? Yeah, I would say so. Despite the holiday, something changes that day, though, which is Mark gets a piece of news that would indeed change the course of history and change the course of his weekend. He found out that Instagram, the hot new mobile photo sharing app, which had been on his radar screen for a few months on the company's radar screen, and had just launched on Android the previous week, adding a million users in, I don't know if it was the day or the week. Pretty quickly. It still mind-blowing to me that this all sort of happened right around the same time. I know. The Android launch, the acquisition, the funding round. So Mark and Facebook find out that Instagram has an acquisition offer on the table from Twitter. I knew this, but I completely forgotten this. I think many people forget about this. Yeah, I actually, it's funny. I was reading through your notes and I was listening to episode two this morning and just thinking about like, oh my God, that almost happened. Yeah. What a different world we would live in today, absolutely. So obviously, I was at Facebook at the time, so I didn't have insight into this, but hearing about it after the fact, I don't know. I think good things happen often really quickly and it all came together for them so fast in an unexpected way. Yeah. Instagram, the company, had literally that week closed their series B, raised $50 million from Sequoia and acquisition offer on the table from Twitter for $525 million. Now this must have been a particularly salient piece of news for Mark Zuckerberg and Facebook, because a few years earlier, also another thing that is public knowledge, but most people don't know, Mark had offered to buy Twitter for just about $500 million a few years earlier. And now here is his former acquisition target that is about to buy his current potential future competitor and he's determined that history is not going to repeat itself here. So he does the only thing he can think, which is he calls Kevin Sestrim, CEO of Instagram, invites him down to his house in Palo Alto and makes him an offer, one would say that he can't refuse, $1 billion, $300 million in cash and $700 million in Facebook stock, which, you know, as we all know, covered in Facebook. I'll say to the Facebook stock. Yeah, I covered in the Facebook IPO episode. Looks like a bad deal about six months later, but ended up being a great deal and worth a lot more than a billion dollars in the long run in many ways because of Instagram. So Kevin receives this offer at Mark's house. He had driven down Instagram's office was in South Park in San Francisco, which also had been the birthplace of Twitter, famously. Jack Dorsey came up with as legend has it, the idea for Twitter in South Park in San Francisco. Today it is Sandhill road north, all the VC firms that used to be in Menlo Park now have their offices in South Park in San Francisco. But Kevin had driven down. He calls his co-founder Mike Krieger, who's back up in the office and says, hey, I need to meet me down here. Can you take the Cal train? So South Park is right next to the Cal train station in San Francisco. Can you take the Cal train down to Palo Alto? Let's meet here and we'll drive back up to the city. I've got some news we got to discuss. So he had left Zucks House at this point. But I'm going to hang here at Zucks House for an hour. Apparently he was sitting on the bench at the Cal train station in Palo Alto, contemplating his life in future. Mike shows up on the train. They drive back up to San Francisco and by the end of the drive, as legend has it, they've decided to take the offer. So that sets in motion to chain of events, what really sets in motion to chain of legal firms that work like Mad throughout the weekend, throughout the holiday, and on Monday, April 9th, the world changes, bombshell announcement. And I said this on an episode too. I'll say it again, I remember the exact moment when I heard this news because this was, I mean, now it seems quaint, almost a billion dollar acquisition. But like this didn't happen back then. This was the first, you know, the term unicorn didn't exist. This was a huge moment. Did this coin it? What created the freeze unicorn? No, actually, I think that was a lean from Huawei Ventures who had done a piece for what was it tech run or something? It was tech run. It was the next summer. And she had come up with the term. Yeah. But, but at this moment in time, you know, this was a huge valuation for a photo sharing app with no business model, no revenue, just bleeding money and server costs. You know, and people really thought, you know, this was heading right into the IPO roadshow. People thought, you know, this is an example of a crazy young founder out of his mind, but too much control of his company. Like, how could you make such a rash decision in a weekend? Turns out that the haters were wrong. Today, you know, we basically all know what happened since then. In last year in 2018, Facebook does not disclose Instagram revenue broken out separately. However, analysts estimate that the Instagram itself did about eight to nine billion dollars in revenue. It is predicted to grow by another almost 50 percent this year to fourteen billion dollars. And that would be almost a quarter of all of Facebook's revenue. So I think that, I mean, pretty good ROI on that acquisition. But that's what we're here to talk about with Emily, which is how did, you know, this company, which was famously thirteen people, no business model, no revenue, this product when, when Facebook bought it. How did you and the team build what would become fourteen billion dollars of revenue today? Yeah. So I remember that Monday too. Did you know about it over the weekend? No, no, no. I knew about it. I'm not even sure the board knew about it. It moved really quickly. And I think internally we had a moment of, wow, this is incredibly cool that our founder has the ability to spot things like this and move so quickly to put them together because you have to be incredibly aggressive in a situation like this. And you also have to have the ability to, he has an obviously incredible sense of what works and what's new. And Instagram had been sort of on the radar, but in a really small way. And so the, I mean, I think it was, I want to say it was like thirteen or sixteen people at the time. It was tiny. It was something that some people at Facebook, some of them Facebook employee population used, but not a ton. But Mark got it immediately and acted really aggressive to make it happen. And of course, the challenge is once these things are announced internally, you've got to sit in totally your thumbs for months as they're undergoing reviews. So the reality is that we actually didn't even really incorporate Instagram into our day to day until I want to say it was much, much, much later that year. And did people at the company in that time after you had announced the acquisition, but before you could start doing any integration work, did people start using it? Did people believe how did people start to believe that Instagram was something that they should really believe in as a Facebook community? I don't think it was on the radar in that way at all. I think it was, wow, that was really cool that we just did this now back to work. So, to be honest, I think everyone just put their heads back down and kept working, right? We had just a ton of things, answers that we didn't have. And there was in some ways, sort of no use in even preparing for it because we didn't know what it was going to look like. It was going to take a while anyway. So, you were running mobile partnerships at Facebook at the time, right? Like, heading Instagram, been on your radar screen? No, I had heard about it, but honestly, I wasn't even using it at the time. And I left, what was it, in late August to have a baby. And Instagram had still not, sort of, not closed at that point. But I came back, handful of months later, and they had just arrived. It was really the first acquisition that Facebook had done, not just for the people, which are typically called aquahires, right? But an acquisition for the people and the company, the underlying product. And while Mark knew that, I'm not sure that many other people really knew this. And because of our lack of experience in this world, they had sort of moved those 13 or 16 people into a corner of one of the buildings. I think they had thrown some engineers over the wall. But I got involved because they moved the team down to Menlo Park, right? They moved the team to Menlo Park, which of course they weren't totally excited about. Did they, like, negotiate for, hey, we need to be separate in some capacity? Do you remember, like, how did it work kind of going back and forth on, well, we need to be separate and be our own team versus we want to be, you know, a part of the Facebook family in some way? Yeah, I have to tell you, my sense of the things, and I wasn't on the inside when I was in Maternity leave, listening to the level of conversation. My sense is that no one really knew. We knew that they had to come down and they would be leveraging what Facebook built. But beyond that, it was pretty unclear. So I got involved when I had come back from Maternity leave, and I think it was Dan Rose, who has just left the company, said, listen, you know, we've acquired Instagram. They're sitting over in this corner and they're having some challenges on the business side. You should go spend some time with Kevin and see, you know, there's maybe some opportunity to help him. What had just happened, I think, before, like maybe the week before, was that Facebook lawyers had gotten a hold of the terms of service that Instagram had. Right. That was good to ask about this. And they rewrote it with a very Facebook frame of mind, which was we want the ability to use this user-generated content in future ad. You know, future ad content. And of course, they did that with... The community revolted. Exactly. I mean, that was such a Facebook way to approach the situation, and Instagram users were not having it. And they really did revolt in a pretty beautiful way, and made themselves known. And I think for us, and for me, being very arms distance at the time, it was a realization that like, this is actually a very different company with a different user mentality, and this, we really need to understand it. And understanding it does not mean taking the Facebook playbook and throwing it at them. Understanding it means getting inside there, understanding the spirit of the company, what makes it so special. And it was sort of through that process that I went... I underwent, and I think the team underwent at the same time. We really understood what Instagram's voice was, and the importance of maintaining a separate identity. And we're going to dive much deeper into that. But we have to ask before then, back on the Facebook side, you know, when all this went down, mobile and Facebook were like... I mean, you must have had a really interesting vantage point running mobile partnerships, but these were the HTML5 days, right? Mobile was not native to Facebook. Let's put it that way. This must have been culture clash. Yeah. I had gone over to work on the mobile efforts in 2011. And I think we had one iOS engineer at the time. One iOS engineer in all of Facebook. Yeah. It was bad. Four years after the iPhone had come. That's amazing. Wait. Yeah. The web had done so well. Yeah. I think everyone saw it coming, but when you have a company that's... I mean, even that size of Facebook, that I'm with thousands and thousands of people, there's a DNA change that has to go on. Even to make a platform change that now seems so simple and so obvious, you know, it really meant that, you know, Mark had to start every product conversation, product review with Show Me Mobile. First, right? I don't want to see your web anymore. I don't want to see desktop. I want to see mobile. So changes like that are things that we really had to do every day and every opportunity to make sure that mobile became part of everyone's job. And it's just not just a sort of small select team. Right. It makes sense. Like, Facebook was built at that point to, you know, the hottest company on the planet in a prior generation. It's totally understandable why, like, the company and everyone focused on that product, you know, other than Mark at that vantage point would be thinking, like, what is this mobile, you know, where are the big grilla here? Yeah. I'm curious, Emily, a lot of times in acquisitions like this, the... There's value destruction that happens because the team at the big company that is doing something most similar to the startup they acquired is allergic to it, even though, you know, upper management believes that acquiring the startup was the right idea. And so they like do everything they can to kill it. Was there any clash with the photos team who sort of looked at Instagram and thought it was competitive or thought it was, you know, the wrong strategy or anything like that? You know, oddly, no. I never, I never witnessed or heard anything like that. I did, and I think I told you guys this as we were prepping, as I was getting to know Kevin and sort of falling more and more in love with the product and his brain and his vision for it. And he and I had started talking about me coming over and joining him. I talked to some friends at Facebook and I got reactions like, why would you do that? That's like joining Facebook photos, where I was told several times that I shouldn't take the job because it was too small for me. That actually resulted in me. I think I, I think I told Kevin twice or three times no. I just was like, no, I, you know, I think I need to continue to focus on mobile. I'm being told that it's the place I need to spend my energy. And I remember driving home one evening. Oprah had just come actually to Facebook and talked to our, our employee base. And she had ended the conversation with an, of course, amazing piece of advice that really sat with me that night, especially on the drive home. She said, listen to your whispers because if you don't listen to your whispers, they become screams. And I was like, what am I doing? These all I want to do is go work on Instagram and we're about to piss away not only a billion dollars and an amazing team, but really the opportunity to disrupt ourselves. And it's a really big struggle. I mean, in disruptive companies to maintain that DNA when you're large and have the ability to say, you know what, there's going to be another generation that is going to sort of take over what we've built. And we want to create the playground to have that, that disruptor being our, in our home with us is pretty mature. And I'm not sure again, everyone got it. And so for me, it was a pretty big aha moment and the, and what drove me back in the next day to, or the next week, you call Kevin at that point. I probably went across the wall to see him and, you know, I, so this was a Friday night. I think on Monday, I went into the exact same told me it was this, the job was to do small and I said, you're wrong. Actually, you're wrong. And here's why I think you're wrong. And they said, I think you're right. Like this is the right move and go for it. Wow. I bet there's a lot of listeners out there who have at some point, while working at a big company, had this realization of, oh, we need to disrupt ourselves. And I think I know how. And in most cases, there's no way to act on it. And certainly they're not going to get executive support. But it is amazing here with the billion dollar bet you having these whispers and realizing, you know, this is, you know, this is something that not only should we kind of bet the company on, but I'm going to bet a lot of my career and reputation on. But you had Mark Zuckerberg supporting the idea that the company should do that. So you were able to actually go and get that done. Yeah. This is a huge issue for companies. I mean, I, being a Google for 10 years, I saw this all the time, right? If you can put a dollar into one business, your main product and get five dollars out, and you're developing a new product, you're putting a dollar and you're getting 70 cents out, or you're putting a dollar and you're getting 120 cents out, right? And I'm not just talking about dollars. I'm talking about engineers. I'm talking about right headcount and the whole ecosystem that goes along with building a business. And so time and time and time again, when you look at this from a high level, you say, why the hell are you investing in this other business? Because our core one is doing so well. So it's, it makes it incredibly hard. So the bar is so unrest realistically high for new businesses. So it really does take often a dramatic acquisition, frankly. A lot of times, like Google is a good example of this. They grow through acquisitions because it's too hard to get the early traction that you need to prove that this is a place you should continue to spend your resources. Yeah. Yeah. Well, that's a good, yeah. I was going to say speaking of building the business, David, you want to take us into dollars in and dollars out? Yeah. Well, I mean, at this point, there's no business model. There's no revenue model. There are no ads in Instagram brands are on Instagram, but it's all organic. It's all brand managers that companies posting posts on their own. How did you even start with Kevin to think about what to do here? I mean, because we're sitting here in 2019, it seems obvious that the model you chose was right. But it wasn't obvious at the time. Like even Facebook's first advertising model, famously was just display ads on the side of the web page and that was terrible. It was years until they figured out the newsfeed. How did you guys start to approach the problem? Yeah. Well, the first question is do you have to make money, right? And that's the question that we debated with ourselves and with a bunch of people at the company. Do you really need to make money? I like making money for some ad words at Google. I've been in that business for a long time. I know it. Kevin and I sort of came to the place where I think we knew that we wanted to make money because if you make money, you can write your rules. You can write your own rules, right? It's easier to try. It's easier to make the case for headcounts. It's easier to have a voice within the company. And of course, we were at this point now a very small company in a very large company, or at least a medium size company that had a lot more people than we did. And it was shortly after I arrived in a handful of months that we hit the 100 million user mark. At that point, we were sitting on top of a company that had the infrastructure and talent to help us monetize relatively quickly compared to how to do this on our own. We had the user base that we needed in order to actually make a viable business. And we knew that we wanted power and control, and they built a right-of-right-errone future moving forward. And so it really made sense that we were going to start with advertising. We also knew that the model that was going to work on Amazon on Instagram. Amazon also has advertising. It could also be foreshadowing of Instagram's future business model. It gave us opportunity to do something pretty different in the ad space, namely around using mobile to actually complete a purchase. And the people were coming to Instagram with a different perspective. Products were showing up in a different way. And it seemed to us, even at that time, that giving users the ability to buy through Instagram ads could be really killer ad format down the road. But that mobile infrastructure, I mean, it's funny. It's about payment. It doesn't exist then, right? Mobile websites were good enough. Did Stripe even exist at this point? Apple Pay certainly didn't. Yeah. Yeah, no. So we knew that we needed to give the industry some time to mature. And so actually starting with the ad formats that we did made a lot of sense as the very first step in a journey. And we knew that we were heading down that path and that the beginning was just that. It was the beginning. So, you know, sometimes, I mean, I would say at Google with ad words, actually, we got relatively lucky that early on, we sort of landed on the ad format that ended up being like the ad format that's still there today. Maybe the best ad format of all time. Pretty good ad format, it's done well. I mean, this was fun, right? This was really fun. We had visual, we launched video, another maybe six months after that. So it was a very rich ecosystem for really the next generation of ad formats and market places. So Instagram as a product was known for being Spartan and beautiful and focused on the content. Ads on Facebook at the time were not that. Right. At least if you generalize it, how did you go about making sure that you didn't know and ruin something beautiful on Instagram by starting to introduce the Facebook business model to it? Yeah. So we made that the number one priority, actually. We knew, and we knew by the way, just looking at what happened with the terms of service, that pissing off her huge face was not the way to go. And that we had something pretty precious and we were going to treat it that way. And we are in the advantageous position, as I mentioned earlier, of not having to make money. We didn't have to pay the bills. So we could take our time and move slowly and be really thoughtful. Which is Facebook's mantra. Exactly. Obviously not. It was an amazing luxury that we had and most companies don't have it. And so we spent a lot of time looking at what content was going up, how users felt about it, what brands were already sort of natively acting on the platform and how users were reacting to them and decided that we were going to place ads in the feed, which was also as you can imagine sort of a controversial moment. Because it's prime real estate. But it's also when you're in an ad business, you need distribution. And that's where distribution was going to happen. But we were going to do so in a way with brands that were already really elegantly playing on the platform and had good user interactions. And we were also going to do it in a very sort of one-off way, meaning every single piece of content that came in was approved by us and Kevin. And that went on for a long time. So we were like hand curating the stuff and paying it really close attention. Wow. Yeah, the first brands were, well, Michael Cors, I think was the first ad on Instagram. And then you had Levi's W Hotels, Macy's Lexus PayPal. General, what circle is in there too? Oh, interesting. And Ben and Jerry's. That's perfect. I'm actually curious on PayPal if you remember. That's not an obvious. I have to tell you, I don't remember the PayPal one, like really specifically. I wish I could speak to it. I can't remember exactly what it was, but it might have been for mobile payments. Anyway. Again, we went back and we said who was really using this. So it's looking back at it, it seems like the most amazing opportunity for a marketer to precipitate in something this early. But remember what the time was. I mean, it was like, okay, we don't want to be the first advertisers because what if they hate it? But if there's backlash, right? I remember actually having a challenge with GE because they had gotten some, they had set you beautiful Instagram presence. But when they started advertising, the users didn't love it. It was in part because it was one of the first ads and it was like, wait a second, now you're calling it or something. It's the place where I go and dumb marketer. And there are comments on ads, right? Right, and there are comments on ads, exactly. And we're basically treating them like organic content that was sponsored tag, right? So in more distribution. So there really is some headwind. You have to find marketers who are willing to go down the road with you and take some risk and believe in what you're doing well enough to sort of get over some bumps. And so we really looked at who was doing really well on Instagram already. And who are the teams that were leaning into this and would be good partners for us along the road, along the way? It's interesting thinking about also in retrospect, I mean, the business model of, okay, we just bought the fastest growing sort of inventory pool available. We have all these advertisers that are trying to push more and more ads to more and more slots or available inventory. It makes so much sense to just enable that dashboard to also push to this new sort of slot pool. Exactly. So tempting, huh? Not going to do it. And I mean, that's effectively what it is today. There's zero, I mean, at PSL all the time, we're buying ads and like you click another box. In fact, for acquired, we've done some ads. You check another box and like boom, the same thing goes on on Instagram and Facebook and there's no real way of sort of quality controlling one or the other. How did you think about like what features of the ad dashboard and in what way to actually let people who are using the ad dashboard tool put ads into Facebook beyond like, I'm sorry, into Instagram, beyond actually hand curing every single one. So that's a tricky question for this because I left in the beginning or very end of 2014. So the actual dashboard integration happened after I left. That was until itself served at all didn't exist till 2015. No, it took a while. It's a great point. Yeah, it took a while. So we were really in the like hand curating, hand posting, hand reporting phase. And I think the other point that's worth making here is sort of what was happening internally and culturally at Facebook and Instagram at that time. So as I mentioned, it was the first time we had acquired a company for the for both Fitalan and the underlying technology and the Facebook community didn't really, the group of people who worked there didn't really understand what that meant. Specifically, let me just give you some examples. You know, besides the lawyer going and sort of, you know, changing the terms of service, a team's generally just wanted to do exactly what they were doing for Facebook. The recruiting team wanted to do what they were doing for Facebook, the policy team wanted to apply Facebook's policies. But everything was just like, okay, let's just integrate them right now. And so really, my first week or two on the job, Kevin and I had like locked ourselves in a room and we mapped out Instagram's mission, vision, and values. Specifically, because we knew that it was important that this thing was, it was big already, but it was going to be much bigger, that it was really important that we maintained our own identity and control over how the product moved forward. And that we were also making it really clear from the employees perspective, like what is Instagram and what is Facebook and how do you play in these two different worlds, right? We wanted people's help, but we couldn't let them smother it. That was the beginning of realizing what Instagram was inside of Facebook, instead of Instagram becoming Facebook. Yeah. Now, of course, as you read the news, there is actually real momentum it looks like inside of Facebook to make Facebook and Instagram and WhatsApp all sort of one thing. But I think for the beginning. Yeah, I mean, there's an alternative history where Instagram became Facebook mobile photo as the app for right? Right. Yeah, no, it could have happened. Yeah. In fact, one of the first things I did is Facebook had maybe six or 12 months before bought an app that was a data compression app. So users all over the world were downloading this app on their phone and it was lowering their phone bill effectively. And in exchange, it was giving information about what users were doing on their mobile phones, right? So I actually, we had access to this. I could go see, okay, of all of the Facebook employees, how many are actually using Instagram? And it turned out that the same percentage of, and I can't remember the exact percentages. Now, but basically the same percent of the United States that was using Instagram was the same percent that Facebook employees are actually using Instagram. The point here is that was very low. It was like in the low teens or something like that. And this was after they'd hit the 100 million user mark. This was just before that. Okay. So Instagram had been acquired. It had been the team had moved down, but still people were so focused on Facebook, right? I mean, as you do. And so really, between the mission vision values and then really like an on-campus marketing campaign where we started doing insta walk tours around the campus and got up and started talking at all hands meetings and thinking about our product launch separately and going to the board meeting and sort of just talking about what Instagram was and what made it special and how it was different. And really the ad strategy in part rolled out of that, right? How do we create a product experience that feels really authentic to this platform? And through that also make a stance about our ability and requirement in some ways to build something that's unique for this platform and not just slap Facebook ads onto these or experience, which I think at that point would have been really rough. Yeah, it's like philosophically how do you make sure that the people who are going to be designing those experience for that platform actually use that platform? Yeah. It's a great point. Yeah. So I think that's actually a really great transition to a topic that I'm super curious about. I've had a lot of listeners certainly interact with this all the time but have no idea what goes into what are the components of building an ad business? You know, that obviously you did it Instagram, but you saw like Google, you saw Facebook, you know, one of the only people, if not the only person in the world who's done this four times, like what are the pillars of this business? Yeah. Well, it also, it's changed so much in that period of time, right? I mean, when when Google started, I remember it actually really did not care about making money. I remember those days. It was like higher smart people have the fastest search results and nothing else. Exactly. Pretty much. So, so I joined Google at the very beginning of 2001 when AdWords was, you know, like 500 advertiser advertising beta was all, you know, based on what was at CPM ranked on the right side and had the luxury of growing at a time when nothing like it existed. I mean, you had over-chirp the time that was doing some interesting stuff on the algorithmic side. But Google, for the first time really married this incredible web presence, right? I mean, they just had traffic coming out of their ears with a very intent-based user experience, right? People are telling you what they're looking for. And so the opportunity to serve up content and they, they really took advantage of that opportunity by saying, this is not just brand marketers who can do this. This is anyone. Right. But initially they actually built AdWords originally, as I mentioned, as a CPM product. So everyone who's showed up at the top right had to pay $10. Everyone underneath them had to pay $8. No, it was at $12.10 and $8. That per thousand views. And that- Was it no auction? The auction came. There was no auction early on. There was no auction. And I would say like a year, year and a half in, the auction came about. So we added in the component of actual click-through rate. So how well were these things performing? And then we added an auction in. So it allowed businesses with wide variety of margins to come and participate all of a sudden. Because when you have a set CPM, you're crowding out 90%. You're only getting a very specific set of advertisers bid. And so we didn't have anyone bidding for, you know, sheep paper music or Persian runs, right? We had a ton bidding for like Missothemi Ithiuma. Boy, or whatever. So it really was, you know, sort of a stroke of genius and look at the same time that those things came together. By the time, for Instagram, the technology to do this obviously had sort of already existed, which was wonderful. But we had also moved as a marketplace to be so much more focused on effectiveness. Right? I mean, AdWords started that, right? You could put a dollar in and you knew what you're going to get out. It really 10, 12 years later that had taken over the world. And so they built it target. Yeah. Facebook dropping, you know, conversion pixels are telling advertisers, hey, you should be putting these conversion pixels at the end of the pot of gold in your website. So we know when these people are actually buying the stuff, you can tell us how much it was for. We can help you tune that. Exactly. So it's like really serious performance marketing. And of course, that existed. That was the expectation in the marketplace. But we were coming out at Instagram with a brand new platform and we didn't know how it was going to work. And we knew they had to be pretty photos and they had to be, they had to speak to our user base in a pretty unique way. And so when you're doing something like that, you don't want to make promises. We knew that we were not building a product that was going to at least in the short term compete with ad, with Facebook ad dollars, right? We weren't going to be that performance marketing vehicle. In fact, initially we talked about it with marketers more as a brand play because there weren't calls to action. It was beautiful content telling a story. Could you tap on the ads the first time they're not not. I mean, there weren't even links in Instagram at all. Nope, there were no links. There were no links. So they really had to fit into that. Again, with the picture of longer term, we wanted links, we wanted the ability to interact, we wanted the ability to purchase and drive purchases, right? Because it's this beautiful ecosystem for discovery. But again, the infrastructure didn't exist then, the mobile infrastructure didn't exist then. So what we did was we very systematically went through all of the pieces of Facebook that we could either lean on or build our own. And we decided systematically, okay, we're going to lean on Facebook for this, we're going to build our own this, right? That, I should say. So we had the Facebook data, right? We knew who our users were. And that was a huge gift because when you're going out with a new ad, we're going to have a new ad product to be able to say, actually, you can target exactly who you want to target was a big, but it's a big win. But we also in the, in the sort of the face of this is going to be, feel a little bit more like brand advertising early on. This was not a world, this was not about micro targeting. This was about getting your audience in pretty broad swaths. Targeting tends to be really important in direct response advertising and less important in brand advertising because you're going for the bigger, broader base. I guess yeah, did you need all that targeting capability for those initials? We needed basic targeting because our user base was 100 million users. And you need really big budgets to target all 100 million users. Right. And by the way, it's not going to be relevant for them. So you have to think about them too. You can be buying a Super Bowl ad every day. No. And nor would that necessarily play particularly well with what we were starting to do. Again, remember the beginning was about little disruption, platform consistent, visual, storytelling experience. And it was also our chance, it was our sandbox. It was our chance to play and sort of try different things. So did you need, maybe I'm jumping ahead of you, but did you need a new ad sales team to go sell these ads in their face with these brands? I mean, that's not the core capability of what the Facebook ad sales team was doing at this time. Yeah. So we decided to do a take a hybrid approach. We leaned on the sales team really heavily because they had all these relationships that we didn't have to go recreate. But we actually started a little ad sales team within our group and we sort of repurposed people who were doing more business development work in the such to go and have those conversations. So when we showed up, this was not a Facebook marketing ad sales meeting. This was an Instagram meeting. Because you're probably meeting with different people within the advertisers, right? Like, do these big brands have different brand versus performance people? You know, probably in some cases, but ultimately when you're doing something this experimental and cutting edge or typically running up to the people at the top anyway, and we tended to work with brands that were doing this in-house and weren't out like outsourcing into agencies. So it was just easier for us. It was low friction for us. We didn't have to go through 10 layers of approval. So again, we were able, we were in such a great position we could go to the advertisers we wanted to go to. It's like the greatest startup of all time where you both get to do things that don't scale and have a playground to do it manually, but can pick up the phone and have an ECEO say, sure, we'll commit $12. Exactly. Yeah. And of course, when I did this again at Snapchat, now Snap, we didn't have anyone to lean on. We had to build it all of our, so we have to build the technology ourselves. Now by that point, which was 2013, I guess it was 2014, 2015, we could have gone to a Google or one of the other engines and said, can you just send us your ads and hear the qualification that they have to meet? And at Snap, you did a partnership with Viacom, right? That was, okay, no, that's a little conflating issues, but I can explain that. But no, we actually decided instead of going to a partner and just having them turn on their ad feed to us, that advertising was going to be an important part of our DNA and our business moving forward. And when it's an important part, you don't want to outsource it. You want to own it. And so we actually went ahead and built the infrastructure in-house to serve the ads, to measure the ads. This is at Snap. This is at Snap. But we launched the Snapchat now Snap. We built that infrastructure in-house. We went and got all the advertisers by ourselves. We did all the measurements. I mean, again, if it's important, you've got to have it in your purview and your control. You want to measure it. You want to know it. You want to understand it. We did down the road when we launched Discover, which is the platform where we pull in third-party content in sort of bite-sized snippet formats that you can sort of read really easily. And so our partners who were actually producing the content to a format that they had agreed on with us were doing a bunch of the ad sales for that content, but not for the core Snapchat content. Because some of it was repurposed, but it was TV commercials that were coming into that. Right. In some cases, yeah. That was the back on partnership. Yeah. Cool. Yeah. I think that about takes us to the end of the road on the history and facts of the Instagram and the vision. So the end, as we said in the beginning, as we always do, is eight to nine billion dollars. Well, a brief timeline. It was 2015, as we mentioned, when self-serve ads launched. 2016 stories launched. There were no stories on Instagram before 2016. But you can think Snapchat. Yeah, Snapchat, right. Yeah, Snapchat, right. And famously, and it wasn't until 2017 that ads in stories launched. I mean, that was two years ago. Well, there's still, I mean, this is still, we've talked about this on previous episodes, but stories is not as good of a medium for advertising as the feed is. And so Facebook and everyone else with stories is going to have a reckoning as more and more attention shifts to stories with their advertising performance. And I think that shows up in Facebook's numbers a little bit and they've cited it a little bit as reasons that there might be a deceleration. But it's kind of obvious in these are experience. When you're going through stories, you're just not grabbed in the same way that you're grabbed. So if you take a step back and think about what we're talking about here, I'm saying that when you are flicking vertically through something, ads are somehow more appealing of a format as when you are horizontally tapping through something. And yet, it is a dramatically different user experience for a story like, ah, not now, not now. I'm in the now. I'm in the story. But when you're scrolling, you're used to studying something for longer. And then being something that you're willing to let interrupt your brain for a little bit. Exactly. So it's really about trying to infuse ads in a story versus in a feed. That's the real difference. We actually at Snapchat, when we launched the live stories, we took a pretty different approach with advertising too because of that actually. And we decided to make it much more of a brand play because brands were typically, they were already part of that social experience. Like if you're going to go to a concert or something, you're going to go to an event. There's usually brands around you anyway that are associated with that. And so our first step was let's pull them in and make them part of this online experience too, not just the in-state-yam experience or the, you know, in concert venue experience. Right. So predicted Instagram to do 14 billion in revenue this year in 2019. And I believe it was shortly before we did our first episode, episode two, on Instagram. City Group had just done a research report on Facebook and estimated the value of Instagram within Facebook at 35 billion at that point in time. Which is a crazy number, right? I mean, we'll get to grading in a minute here. But, you know, by any measure, a business that big, growing it 40, 50% a year with a very high margin, you know, ad revenue business, probably going to get at least a 10x revenue multiple. Which is very high, but like warranted, you look at like squares trading at a 10x revenue multiple with worse margins. So you're saying the enterprise value of Facebook? I'm sorry, I've Instagram is somewhere around $150 billion. That's what I'm saying. At least, right? You know, and Facebook's market cap, as I believe about 400 billion today, didn't look right exactly. Which is interestingly right about 2x from the last time we dove into this story at the end of 2015. So there you have it. For the moment, we're going to pause our history of banks on Instagram. Facebook tells me we'll revisit this again in the future. I'm pulling forward a tech theme here, but it is interesting to take a step back and just let it dawn on you that, you know, Friendster and Myspace never, I mean, imagine if Myspace had bought Facebook and they said, okay, look, it's not about Myspace, the platform succeeding, it's Myspace, the company succeeding. And Facebook did that when they bought Instagram. And so Facebook is becoming less relevant. Instagram became way more relevant. It was the thing the kids were on. Everyone's parents got on Facebook. Snaps started to steal some of that back. And then Instagram, you know, Facebook, Instagram sort of wisely realized, we're going to leverage what we still have. And that's the network. And we're just going to copy feature for feature in a way that blends really well into our product. And they managed to sort of like steal a lot of that back. And Instagram remained sort of or avoided that sort of low end disruption. And the thing that I'm wondering now is sort of like, have the parents come to Instagram and have his Instagram become uncool? And is there something else that Facebook's going to need to go by here shortly when the existing social networks are sort of in our parents now? Yeah, as the parent in the room, parents are on Instagram. First of all, I think we're seeing that there's longevity to these things. I mean, Facebook has been around in it itself for a while, right? And it still is even though it doesn't always feel like it's as much of our day to day as it used to be, it's still incredibly successful. Instagram has managed so far to stay really true to its initial character, I think, while adding on some really nice bells and whistles that keeps it current and has really helped, as you mentioned, capture sort of some of the wandering eyes off. So I don't know, I would still bet money on Instagram continuing to do well, although we'll see what happens when, you know, as Facebook is thinking about bringing all these products together, you know, that's a very delicate situation that they can't really afford to mess up. Yep. Yeah, and it's, it actually, we shouldn't call the history in fact done without mentioning that the founders are no longer at Facebook and left in the end of 2018. And it sort of disagreements about the future direction of the product. So I'm not saddles. It's been a long time. Yeah, yeah, yeah. I come down way in the camp, can I just say it was ridiculous reading those news articles that were all like, the founders are leaving. This is crazy and it signals all these bets. It's like, I can't believe how long they were there. I mean, it really speaks to like, it speaks to how right the acquisition actually went if they stayed this long. It never happens. Yeah. So you're right, and I think that these things become institutionalized too. I mean, I think that people and culture are everything to a business. And by the time that, you know, Kevin and Mike left, like they had built an organization of people that they had hand picked and they had decided what the culture was going to be and that existed within Facebook. Now can they keep it going? We'll see, but it's, you know, it's so much larger than just the two of them now. Yeah. It's a great point. Well, actually, this is a really good segue to revisiting acquisition category here. I believe I called this a technology acquisition in episode two. I think we were trying to disagree more. And Emily, we should talk here about like, and for folks who are new to the show, every time we, we bucket into a category of people, technology, product, business line, asset or other. And we've come up with like several different others over the years. But basically, the main distinction to draw there is between technology, product and business line. A business line is when you're buying something that's revenue generating and you're going to sort of leave it alone. And it's going to, it's going to increase in value and you're going to, uh, yeah, yeah, a product is something that I would argue like Instagram, for example, where it was not its own business line, but you were buying something that was sort of a fully baked thing that people were going to use that was its own full value chain, not like other. The technology is like you're buying an ML service. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. And yeah, that was probably because we were trying to disagree more at that point in the show. But, uh, I don't think there's many. There's no arguments about that. So what would have happened otherwise? A lot of times we talk about like what would have happened if this didn't get bought? And we wax philosophically about that before anybody who wants to go listen to episode two. I'm curious about and I want to pick Emily's brain on is what if Twitter had successfully bought Instagram? What do you think the most likely outcome is of that, if that had happened? Oh my gosh. That's a really hard one. I will tell you that, um, with, you know, sort of knowing that the Twitter history, uh, when Kevin and I went to present to the board, I don't know, maybe four or six months after I joined, I said to the board, we just bought the next Twitter. It's going to be big on the Twitter because it was so much smaller than time. But I was trying to get across the point, which I wasn't sure they knew that this was a really big deal and it had tremendous amount of traction and the board was skeptical that you were overselling. Maybe. Uh, maybe. Uh, maybe. I think that, listen, I think had, we'll start with like had Facebook not acquired Instagram. I don't know where Facebook would be today, honestly. Um, I think that Mark showed a level of ingenuity in identifying and moving quickly on the Instagram acquisition. And maybe he would have done it on the next one. I don't know when been successful with that. I'm pretty sure that Instagram would have been very successful. It just would have taken longer, right? I mean, we leveraged a lot of what was at Facebook to make it grow this quickly, right? The expertise, the technology, the people, um, the go-to-market, it's, there's all built in, which was wonderful. We intentionally maintained the product experience and that has continued to do very, very well despite, you know, and in addition to it being part of Facebook, I'd Twitter about it. So the management challenges there have, have gone on for a really long time. Yeah. And, you know, you'd like to think that Instagram would have been able to carve out their own niche within Twitter and been able to avoid getting caught up in sort of the drama there and but who knows? But yeah, because that was, this was, um, project or so you coming back to see, um, and, um, um, there was still there. That, that moment in time was, uh, would have been a hard entry point, I think, for any business into, uh, into, into Twitter as a company. Let's say for, for Dicoslo, a pression to try and close them for 500 million. Yeah. I mean, that's, that could have been a nice, uh, a nice pickup. Yeah. Yeah. But these, we're living in a world. I mean, at that point, with 13 or 16 employees, no revenue, user traction, it's all sort of funny. Yeah. Doesn't even matter, honestly. I mean, at that level, if you, if you save or have to spend an extra 500 million, it would sound so bizarre, but the possibility is so tremendous that it really doesn't matter. Yeah. It's funny. This reminded me of, um, this will be for another episode someday, but, uh, I remember when I was at GSB in, in business school, uh, business stone came to one of my classes and told the story of when Mark Zuckerberg tried to buy them for 500 million. And I'm probably butchering the story, but the legend has it that, uh, it was business and, uh, they met with Mark, then they got back in the car and they were driving back up to San Francisco, deciding whether to take it and, and ever said something like, no, for worth, you know, 500 million or worth five billion or so. I think it was if we're worth a billion or worth 10 billion or something like that. And like, it sounds so silly, but you're right. Like when you're talking about things at this scale and these opportunities, like Instagram, 500 million, a billion, 10 billion, whatever. It's a steal at any price. It is crazy. Yeah. That Twitter offered 500 million for Instagram and then Facebook bought WhatsApp for 40 times that. Yeah. Like, well, that goes to the point of like, I think there's just maturing viewpoints on what these things are worth. But you have to remember that Ev had sold his last company blogger to Google. Yep. Right. So he had been down this road. Yeah. He knew what integrations look like. Yep. Um, he knew he'd made money at that point and founders mindset's change when they have something in their pocket. Yeah. That's another thing that's changed since those days. I mean, it used to be, um, I feel like Instagram also ushered in, um, the age of secondary is being okay for founders, right? Because if you haven't made any money and you have a billion dollar deal on the table, um, that's not taking it. That's not taking it. But if you're able to take some money off the table along the way and like buy a house, you know, um, it's easier to keep going and build a hundred and fifty billion dollars. Exactly. You need a billion dollar acquisition to buy a house. Basically. Crazy. So one other question in here for Emily, knowing Facebook as intimately as you did at that point, do you think without buying Instagram that Facebook would have been able to succeed on mobile for the blue app for their own product and, and how crazy was the ship already turning into native native native mobile is super important by the time the Instagram acquisition happened? At that point, they had realized it. Okay. Remember when Facebook came out with Facebook phone? Oh, yes. Oh, wow. I mean, there was a lot of effort. There were a lot of efforts underway at that company. Yeah. I mean, um, to make sure that it was mobile first company. And I would say it took about a year, year and a half to really make that DNA change. But by the time Instagram was brought in, it was humming. It was fun. I have to say, um, for me personally, because I had only worked on at companies that had made that transition, right? I'd never worked at a sort of mobile native. I mean, we would remember like sort of getting in these conversations about like how much, do we continue to invest in Instagram web version and like, why did it exist? And how much functionality do we want to put in there and when did people use it and do it even needed it? So the world has changed a lot. Yeah. Although I will say Jenny, my wife uses Instagram web quite a bit. And we have web listeners of acquired. I heard they're adding DMs to Instagram web. Like big flash news. You know, this is 2019 and this is what we're excited about. But the main use case was really the ability to reference it in press, right? They needed the ability to pull web images and web embedded. Of course. Right? So that was sort of one of the initial key drivers. But yeah, I mean, it was really a second-class citizen for it. It sounds like it still is. Yeah. Yeah. Well, tech themes, I feel like preusual. We've covered a lot of them. One I wanted to out there that I think hadn't thought about before this and you know, talking to you, Emily, it seems to me. And feel free to disagree. But it seems to me like even though Instagram had certainly lots of advantages within Facebook. And as you say, you know, got to where it would have gotten anyway, but faster. It's kind of amazing how much it still was a startup journey, right? Like you were having to do, you know, Instagram walks to evangelize Instagram within Facebook. Like it's still a fight for resources. It's not like an acquisition happens in a business on this scale and like everything's done. The hard work's over. You know, it's still like building the company. It felt so much like a startup. And at the same time, we were part of a public company, which then emphasized at least to me that we needed to double down on who we were and really make sure that we knew it and that we were defining it for the community because otherwise, it's just way too easy to get bold over by like the massive organization that you're a part of, right? And so, you know, our ability, we still had to recruit entrepreneurial people and engineers, right? We didn't want people who were sort of nine to five. We wanted like passionate people who loved this business. And we needed to, we needed to make sure that people understood that we were different in our own way while still being part of it. Did you guys, or maybe even you specifically given your history, did you look at YouTube within Google as like an example of this? I mean, separate campuses, separate cultures, separate everything, obviously shared on a lot of fronts, but really enabled those businesses to grow separately. Yeah, I think Google did a really nice job with the YouTube acquisition and that they resourced it, they informed it, but they let it fly on its own for a very long time. And you don't know if you remember, but like before Google, Pot, YouTube, they had launched Google TV and it had not worked. It had not worked. And so they kind of knew that they didn't know what they were doing, but that YouTube had figured it out. And so that was a very smart move and I think they've done a nice job with many of their nest is another one right where they're just sort of keeping it separate. In the case of Facebook and Instagram, there's so much underlying overlap, right? I mean, the sort of back end infrastructure. I mean, even you think about like the content policing, like that takes top teams and teams of people all over the world. And so it was actively employed like tens of thousands of people today. Yes, absolutely. No, it's amazing how much manual work still goes into into that. And so being able to sort of plug into that and quickly again, because the team was so small and so immature, but we had this user base that was large, the size of a much more mature company. And we had to deliver to those standards. So it was incredibly, it was amazing resource for us to be within Facebook where we had all of those people and had those systems where we did decide though we decided like we're going to have our own policies of what we're going to allow and what we're not going to allow. And that this is more of an artistic platform and one of expression in a way that Facebook isn't. So what does that mean for the review process that we have? So again, we went systematically one by one and decided where we were going to integrate and where we were going to have our own sort of perspective. Right. Wow, fascinating. It's funny. The one I've been thinking about is you were talking about at the time of acquisition or just thereafter, you and the Instagram team were kicking around ideas about Instagram as a transaction platform and wouldn't it be great if in this really seamless experience you could buy stuff right from this beautiful, browsable photography. And that was five, six years ago now and we're just starting to hear whispers now that that's starting to get productized. And it just reminds me so much of when you have a startup idea or you're, you know, hearing someone start a idea and they're talking about this thing that they think they eventually will be able to do. And it's, it's, it actually doesn't sound that hard. A lot of times these things are like, well, why don't you just do that feature? But there's this is merace of stuff that underlies it that has to, you know, be built foundationally before that's even possible. You know, it's just a testament to the near term work and that thing that you want to achieve eventually fitting under the same mission and vision so that you can put the mission and vision on the wall, use that as a knife for decision making. Does it fit in that or does it not? And without having to build that thing today, still be able to march toward the goal of building that thing eventually. And these things, you know, whether you have billions of dollars at your disposal within a big company or, you know, your scrappy startup just takes a ton of time to be able to realize these. And you have to remember, this is all happening at a time where it was like, do we even need to monetize and we decided we need to monetize, but we also needed to grow the product. Right? So we hadn't launched video. Right? So I mean, there's a lot, we hadn't launched direct messaging, we hadn't launched stories. And so of course, you know, the demise of many of business comes when there's lack of focus and you want to do everything. And one of the nice things about being small is that it really forces you to prioritize. And even though we were in within a larger company, we still felt like a startup, we still felt like a small team and we knew we could not do everything at once. And so you start to think about horizons. And when does it make sense to do something? When does it make sense from a technological perspective? When is our community going to be ready for it? How do you balance monetization, non-monetization together to create a story so you're continuing to drive user value? They all go into the recipe and decision making process. That's really, I have one more theme that I didn't think of till just now too, but, you know, saying this, it strikes me too, that there also was like a really perhaps equally viable history where Facebook acquires Instagram and you and Kevin and Mike decide monetization is not that important, right? And then the world looks very different today, right? So it just reminds me that the end of the day, this is really all about the people, right? I assume if the three of you had been like, hmm, okay, the company probably would have been okay with that, right? It came down to you guys saying, no, we are going to monetize. We are going to build a business here, right? Oh my gosh. The history is littered with these small decisions that seem so small at the moment. This is a parallel example when I first joined the Facebook mobile team. I went and looked at all the contracts we had with carriers. Now we were not monetizing mobile at all, but in the contracts we had written in that they would get like roughly, I think on average, like 5% of the mobile revenue. I'm not kidding. Wow. And I read these. I was like, okay, so we need to change this to zero. Before we launch ads, let's go do it. And we did. But you know, such a minor thing that you could have sort of, you could very well have justified it. By the way, it wasn't easy. These, these, the mobile operators were not happy that we did this, but we also knew we had, I mean, it was really like, we could choose to give some of it back, but we didn't want to be contractually obligated to be in a rev share with anyone because we hadn't done it before. There was no real need to do it. And so it does go to show too, like whoever negotiated those originally was probably thinking like, you know, we really need to have Facebook on mobile. No, it's never going to be a huge revenue driver for us. Don't care. I'll put it in. Exactly. I know, right? Hindsight's 2020. Yeah. And on wet phones, they were right. They were right. Wap. Oh, wow. All right. Well, grating, this is going to be short. Still an A plus. Still an A plus. Somehow there's not an A plus plus. So we're, we're just going to, just going to keep it there. Emily, do you have any different opinion? No. Run. Home run in every regard. This is like a game, like a season ending home run. Like you could just want. Yeah. Anyway, carve outs. Yeah. So it's funny. We were talking about podcasting before the show. And we're talking about Joe Rogan, who I believe has the most popular podcast. And yet I had never really, other than the Elon Musk blunt smoking episode had never really tuned in and it's a phenomenal episode. And it's a great interview with the guy. I need to listen to the Jack Dorsey interview as well. The episode I just listened to is Sam Harris, guesting on Joe Rogan. And you know, Sam, super thoughtful moral philosopher, I think, but also he's and and and and he's he's he's lots of things. YouTube personality, thoughtful person of the internet and author. And their dialogue on they both on their shows interview Jack Dorsey. They both are sort of kicking around direct monetization and flipping the business model. Like we talked about in the last episode of podcasting. They're both super thoughtful, but serve very different audiences. And it's just fascinating. And I think they're great friends. And it's fascinating to hear them relate to each other where they're these sort of mega influencers in wildly different worlds. And I think it's a it's a fascinating lesson for for anyone who's a fan of podcasts, a fan of trying to understand the world of media a little bit, but then also a new media in an influencer sense, but then also trying to understand, you know, they do like 20 minutes on what it's like to prepare for an interview Jack Dorsey. And that's sort of a fascinating sort of dive into their their different psyches. So I highly recommend that episode. Oh, I got to add to my list. That's awesome. I'm a podcast, the new Instagram. My carve out is a really, really fun book, which I'm not quite done reading yet, but can't wait to finish. Boomtown by Sam Anderson, history of Oklahoma of Oklahoma City, specifically. Man, I did not know anything about the history of Oklahoma City. So he was a journalist was assigned to write about the thunder and the basketball team and stealing the thunder from Seattle, but realized that there's a much bigger story about the history of Oklahoma City, which sounds like why would you write a book about that? But it's crazy. It is very worth, I can't even describe it, other than like, I cannot believe that even in the late 1800s, like basically what happened was you read about this in elementary school in history, like the US government, Oklahoma was a unassigned territory former native lands. And they decided that one day at noon on April 22nd, I think like 1889, they were just going, anybody who wanted land could come in and claim 168 years of land. That's it. There was no. So like at noon on that day was, you know, the boom and Oklahoma happened overnight and Oklahoma City happened. So people like lying about the house. Like people cheated. They were in the sooners. That's why they're the sooners. They cheated and came across the border earlier. And like who's going to tell them now? It was chaos. And in many ways, Oklahoma and Oklahoma City have been the same ever since. So really, really fun. Kind of hard to believe this happened in America. But, okay. It's like domain names, but in real life. Yeah. Awesome. Awesome. Well, listeners that is all we've got today, Emily, where can our listeners find you on the internet if that is something that you'd be interested in, and sharing? Oh, so ironically, I'm not sure I can really be found. I feel like my life in the, my life in social media is so much on like the operations and making it happen and so let's share inside. I don't tweet. I read. I look at Instagram. I actually don't even post that much in same Facebook. So I'm much more of a consumer. But that has to do with so much of my preference for being sort of a quiet private person. Yeah. Well, awesome. Well, look for me at the halls of the airport. Well, listeners, if you do want to hear a little bit of a deeper dive into some of the things that Emily thinks about today with investing at Anthos and a lot of the other things that she had talked about throughout her career at Google, then tune in. And we will be continuing the discussion in the limited partner show. So you can click the link in the show notes to go to slash acquired or if you are already a member, just hit the back button in your podcast client and go to the LP show feed. So we will see you next time. behalf of deutschen.