Set­ting up the deal

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on it with me. That turned into an ac­ci­den­tal com­pany; that turned into an ac­ci­den­tally big­ger com­pany that ended up chang­ing the world in a re­ally mean­ing­ful way.”

Sys­trom grew up in Hol­lis­ton, a sub­urb of Bos­ton. His fam­ily “wasn’t well off, but wasn’t worst off”. His par­ents, Doug, a hu­man re­sources ex­ec­u­tive, and Diane, a mar­ket­ing man­ager at the car shar­ing ser­vice Zipcar, sent him to Mid­dle­sex, a Mas­sachusetts board­ing school. Sys­trom was pres­i­dent of the pho­tog­ra­phy club and was hy­per-com­pet­i­tive thanks to cross-coun­try run­ning.

It is this com­pet­i­tive­ness he cred­its for a key char­ac­ter­is­tic. In Sil­i­con Val­ley, they call it be­ing able to “pivot”, which means abruptly to change the fo­cus of a busi­ness. To ev­ery­one else, it means re­al­is­ing when you have screwed up and try­ing some­thing dif­fer­ent – fast. Sys­trom can pivot like no other.

That was first ev­i­dent when he went to Stan­ford Univer­sity. He had in­tended to study com­puter science, but found he wasn’t good enough. “I wasn’t used to get­ting a B-mi­nus, so I thought, ‘[for­get this] I’m go­ing to find some­thing I’m good at,’” he says. He switched to a de­gree in man­age­ment science and en­gi­neer­ing, pro­vid­ing a solid un­der­stand­ing of busi­ness. At Stan­ford, he made key con­nec­tions that gilded his fu­ture. He first met Zucker­berg at a fra­ter­nity party. Zucker­berg tried to con­vince Sys­trom to give up his de­gree to build a photo ser­vice for the grow­ing so­cial net­work­ing site. Sys­trom passed.

Dur­ing one term, he de­cided to go to Florence to study pho­tog­ra­phy. His teacher con­vinced him to aban­don his high-spec Nikon SLR cam­era in favour of a plas­tic Holga that took square pho­tos, a shape now syn­ony­mous with In­sta­gram shots.

Sys­trom took an in­tern­ship in Odeo, the com­pany that would morph into Twit­ter.

He shared a desk with Jack Dorsey, who would go on to be­come chair­man of Twit­ter. The two bonded over deli sand­wiches. (Dorsey would help get In­sta­gram off the ground, be­com­ing an early in­vestor and post­ing fil­tered pho­tos from his much-fol­lowed Twit­ter ac­count.) When sub­se­quent jobs at Google and a travel start-up called Nextstop failed to in­spire, Sys­trom founded his own com­pany, Burbn, a “lo­ca­tion check-in ser­vice” that al­lowed users to tell peo­ple where they were and what they were do­ing. Work­ing from the free Wi-Fi pro­vided at San Fran­cisco cof­fee houses, he kept bump­ing into Mike Krieger, a com­puter pro­gram­mer Sys­trom knew from Stan­ford.

The pair be­gan trad­ing tips. Sys­trom con­vinced Krieger, a more tech­ni­cally pro­fi­cient coder, to aban­don his job and come on board as a co-founder. De­spite gain­ing plenty of fund­ing – $500,000 (Dh1.84m) from ven­ture cap­i­tal­ists – Burbn was strug­gling. Ri­vals such as Foursquare had gained too much buzz. Once again, Sys­trom chose to pivot. “We locked our­selves in a tiny room in our start-up space and laid out where we were,” said Krieger.

The one part of Burbn that peo­ple loved was the abil­ity to share pho­to­graphs from their phones. So they re­named the ser­vice In­sta­gram and rounded on that. In the sum­mer of 2010, Sys­trom had a fi­nal idea. He and his long­time girl­friend Ni­cole Schuetz took a hol­i­day to an artists’ col­lec­tive called To­dos Santos in Mex­ico, and dur­ing a stroll on the beach, she men­tioned a friend’s pho­to­graphs were bet­ter than hers be­cause they’d had fil­ters ap­plied to them af­ter­wards.

Sys­trom spent the rest of the day in a ham­mock cre­at­ing the first In­sta­gram fil­ter.

In­sta­gram was an in­sta-hit. Within 18 months, 30 mil­lion iPhone users were hooked. By com­par­i­son, Face­book took more than four years to get a sim­i­lar-sized au­di­ence. An­a­lysts now con­sider it to be the fastest-grow­ing so­cial net­work yet. It has helped to create the phe­nom­e­non of “self­ies”, self-por­traits of wannabe aes­thetes who use coloured fil­ters to make their lives ap­pear more ex­otic. Sports stars, ac­tors and mu­si­cians joined In­sta­gram in droves, giv­ing fans a win­dow into their worlds. Zucker­berg, whose so­cial net­work went strato­spheric once it al­lowed pho­tos to be up­loaded, was watch­ing with in­ter­est. In­sta­gram could be­come a pow­er­ful ri­val, ex­ploit­ing an area of vul­ner­a­bil­ity for Face­book – its ap­peal on mo­bile phones. So Zucker­berg called up his old friend. Sys­trom says he doesn’t much like the way the deal has been re­ported, so here’s the short ver­sion. In April 2012, Sys­trom turned up at Zucker­berg’s home in Palo Alto, Cal­i­for­nia. Re­ports sug­gest he opened by men­tion­ing $2bn as a suit­able price tag. Three days later, they set­tled on $1bn – $300m in cash, the rest in Face­book stock, a gen­er­ous deal be­cause Face­book was on the verge of its stock­mar­ket de­but, which would value the com­pany at more than $100bn. Not only that, he wouldn’t have to give up con­trol. In­sta­gram would re­main “in­de­pen­dent”, run by Sys­trom but un­der Face­book’s su­per­vi­sion.

“Maybe we’ll use this op­por­tu­nity to set the record straight,” he says. “I never asked for $2bn. It was a process of ne­go­ti­a­tion.”

It is the deal that has most changed his life. The size and speed of it brought Sys­trom a level of at­ten­tion that he says it has taken time to cope with. Sud­denly, he went from Kevin Sys­trom, start-up founder, to Kevin Sys­trom: zil­lion­aire party an­i­mal. The New York Post de­scribed how he had par­tied in Las Ve­gas and re­ported on the star-stud­ded soirées at a (non-ex­is­tent) se­cond home in New York.

He ap­peared on the cover of Forbes magazine in Au­gust. (Sys­trom’s es­ti­mated wealth, by the way, is $400m.) “That Forbes cover was in­ter­est­ing be­cause most of my friends said, ‘You don’t look like that’.” He strug­gles to ex­plain what both­ered him. I sug­gest maybe it’s be­cause it ap­peared as though he had stepped


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