Early failures were seeds of Instagram\'s success

It's all a query of momentum. That is the difference between the millions of online ideas that simply melt away and the handful, like Instagram, which keep rolling and growing until they deliver the life-changing pay-day every start-up founder dreams of.

The photo-sharing network first appeared on Apple's App Store on October 6, 2010. Its rise have been relentless. It had one million users within two months and has kept expanding since.

As a result of Facebook's US$1 billion ($1.22 billion) buy-out this week, Kevin Systrom and Mike Krieger are becoming vastly wealthy overnight while still of their 20s, but their discovery of this sort of winning formula was a drawn-out process.

At the road to honing the Instagram app, they left behind a chain of failed projects. Krieger worked on an app that aimed to counter seasonal affective disorder (SAD) by offering sufferers the rays of light in photos posted by users living in warmer climates.

Meanwhile Systrom, who had formerly worked for Google, deploy a location-based web service called Burbn, which did not go exactly in line with plan.

Burbn never got past a couple of hundred users, nevertheless it allowed Systrom - who, based on the web site TechCrunch, raised US$500,000 in seed funding for the project - to develop his programming skills, just because the sunshine project was an important learning curve for Krieger, an engineer and user-interface designer.

Those users who had signed up for Burbn mostly used it to upload photos in their visits to bars and cafes.

Systrom recognised that he was directly to something and Burbn duly became the skeleton model for Instagram.

The Instagram app allows users to take photos using a number of filters, with names comparable to "Toaster", "Lord Kelvin" and "1977", giving their images a particular retro look.

The formula has proved globally popular. Crucially, the photographs can also be shared across a number of social-media sites, from Facebook and Foursquare to Twitter and Tumblr.

By last June, the app had five million users and it has added about two million a month since.

The surge in interest was fuelled by celebrity endorsements from Justin Bieber, Kim Kardashian, Snoop Dogg after which Barack Obama, who all took out accounts. Bieber notably was a major driver of traffic from his army of 20 million followers.

When the Facebook founder Mark Zuckerberg clinched his US$1 billion purchase of the 18-month-old start-up, Instagram had a user base of 30 million updating five million photos day-to-day.

The dimensions of the deal brought gasps of astonishment even in a global that has witnessed the buyouts of MySpace (bought by News Corp for US$580 million in 2005), YouTube (bought by Google for US$1.65 billion in 2006) and The Huffington Post (bought by AOL for US$315 million in 2011), Facebook's reasons soon became clearer.

Until last week, when it released an Android App, Instagram was available only on Apple devices. The construction has given the appliance an excellent greater momentum.

Within 24 hours of being available on Android it found a million new users. After six days it had registered five million Android downloads.

So, does the Instagram deal herald a brand new dot.com boom? Not likely.

Zuckerberg, who will allow Instagram to stay as a separate brand, was making his first major acquisition.

Among start-ups within the UK, Mind Candy - the corporate behind the Moshi Monsters brand - seems best-placed to enjoy a huge pay-day. However the market remains cautious.

Instagram probably worth US$1 billion this week. Nonetheless it could become a fad.

- Independent

By Ian Burrell