Let’s set the scene, it is Q1 of 2012, and Facebook is on the hunt for the next “big thing”. Up until this point, all of their acquisitions have totaled in less than $100 million. With an impending IPO and roughly $4 billion dollars in the bank, Facebook was “sitting pretty” by almost all standards. This is what sets Mark Zuckerberg apart from almost all other entrepreneurs. Instead of resting on his accomplishments, Mark was relentlessly focused on Facebook’s problems. Their mobile game was weak, and they needed to remain relevant past their IPO to continue to build the vision Mark set out.
The attention had shifted to mobile in a big way the 18 months leading up to 2012, and Facebook had begun to show signs of aging. The once agile company had begun to slow down and Mark knew he needed to shake things up.
This is the defining trait I believe every great entrepreneur has, the ability to know where the market is going. Zuck’s is a student of attention, as all great businessmen are.
This is where Instagram comes into place. 556 days into the businesses lifecycle Zuckerberg knew it had the attention of the consumer. At the time, Instagram had roughly 30 Million DAU’s (daily active users), up 20 million from Sept of 2011. These numbers are not what is impressive in my opinion, what is impressive is how quickly Zuckerberg picked up on the implications of Instagram. It’s not like Zuckerberg woke up the 1st of April and said “I want to buy Instagram”, he had been watching this company from the beginning.
This is what buying underpriced attention looks like. It’s having your ear to the ground as to what the consumer is actually doing. If you want to understand where you will be marketing your eCommerce store in 24 months, go to the mall and watch what 14-16 year olds are doing on their phone… or off of it. If you want to know what influencers matter, don’t open up a Vogue catalog. Instead go look at the trending page of Youtube and Twitch.
The takeaway from this article is to never stop paying attention. Never get too tall to keep your ear to the ground. Who knows, you may discover the next billion dollar steal.