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Keep it simple while scaling big


You can scale big with a simple idea (and a tiny team!) — but only if you catch the prevailing winds. That’s what Kevin Systrom did when he co-founded Instagram: The simple photo app tapped the right trends, built on larger social networks, and dodged the complexities that would have slowed them down. The result? 30M users in 18 months. And a $1B sale of a 13-person company.

“If you don’t change the service, the world changes underneath you and you become less relevant. So the lesson is …when you change it, how do you keep it feeling simple?”

— Kevin Systrom
About the guest:

Kevin Systrom co-founded Instagram in 2010 with friend Mike Krieger. After only two years and with just 13 employees, Instagram sold to Facebook for $1 billion in cash and stock. Now Instagram has more than 800 million monthly active users, sharing 80 million photos on an average day.

About the host:

Reid Hoffman is the host of Masters of Scale. A Silicon Valley entrepreneur and investor, he’s known for his spot-on insights on how to scale a startup. He’s a partner at Greylock and co-founder of LinkedIn, and co-author of the best-selling Blitzscaling and The Startup of You.

Also featured in this episode:

Rohan Gunatillake is the creator of Buddhify, a mindfulness and meditation app, and the author of Modern Mindfulness (This Is Happening). He’s the host…

Lee David Zlotoff is a producer, director and screenwriter with a hundred primetime credits. He is best known as the creator of the TV…

Simple ideas can soar to massive scale, but only if you steer them to catch the prevailing winds.

— Reid Hoffman
Transcript of Masters of Scale: Keep it simple while scaling big
Table of Contents:

REID HOFFMAN: Florence, Italy. Set among the cypress trees and the olive groves, art, science and culture flourished here between the 15th and 16th centuries, setting the stage for the modern world. Today, art lovers flock to the city to see Michelangelo’s David, Brunelleschi’s duomo, and models of Da Vinci’s flying machine, along with hundreds of renaissance sculptures and frescoes. 

It was this artistic pedigree – along with the fantastic Italian espresso – that drew a young Kevin Systrom to Florence. 

KEVIN SYSTROM: I decided my junior year, I wanted to study abroad, and honestly I didn’t like languages, but I picked Italian because I was told it was the easiest to pick up, but I fell in love with it and I wasn’t terrible at it. I got pretty good. And I was like, “Yeah, I want to go to Italy and I love coffee and art.”

HOFFMAN: Kevin was an avid photographer. He went to Florence with lofty intentions of creating his own art. He came equipped with a very expensive camera.

SYSTROM: It was like the exact lens you want to use with the sharpest glass that you could get. 

HOFFMAN: Kevin was about to get a lesson that would stay with him forever.

SYSTROM: My professor Charlie looks at me with my camera – which is, I think an embodiment of my personality of perfection – and he looked at me and he was like, “No, no, no. Like you’re not here to do perfection. Give me that.” 

So I did and I thought he was going to tweak with the settings and then he went into the other room came back with a plastic camera. He’s like, “You’re not allowed to use your camera for the next three months.” And I had like, saved for this thing. So he gives me this camera and I’m like looking at it, it’s like a toy camera.

HOFFMAN: Charlie had replaced Kevin’s prized professional rig with a simple, cheap Chinese camera known as a Holga.

SYSTROM: If you haven’t seen a Holga, it’s like a toy camera. It’s got a plastic lens and like, light leaks into the side of it if you’re not careful. He’s like, “You have to learn to love imperfection.”

HOFFMAN: With his new toy in hand, Kevin immersed himself in the art and cafe culture of Florence. He soon embraced the simplicity of the Holga.

SYSTROM: I started taking pictures on the go, when I was around Florence and I would bring it back and he would show me how to develop these photos and they were square, first of all, but they were like slightly blurry and slightly artistic and then he showed me how to add chemicals to the development bath so that it could actually tone the black and white photo with different colors. 

So if you’re listening to this and, you know, Instagram, you see a connection. Right? Like square photos and filtering photos.

HOFFMAN: That’s right. Kevin Systrom would go on to co-found Instagram, the photo-sharing app. The app that gave everyone access to the aesthetics – and the appealing simplicity – of the Holga.

SYSTROM: If you go back to my profile and scroll all the way back, I mean, it’s blurry, it looks like they’re a light leaks, et cetera, and two and two just came together. I think the best products are usually built based on personal experience from your past and you never know exactly what parts of your past will come together to form that puzzle and be a product that you want to build for the world, but inevitably something from your past triggers a memory and you say, “You know what, people might just like that.”

HOFFMAN: People certainly did. Over 1 billion of them. And each day, more people fall under the fantastic plastic spell conjured by Kevin’s first encounter with that Holga. His early lesson in the power of simplicity hit the app store – and social media networks – at exactly the right time.

I believe simple ideas can soar to massive scale but only if you steer them to catch the prevailing winds.


HOFFMAN: I​’m Reid Hoffman, founder of LinkedIn, investor at Greylock, and your host. And I believe simple ideas can soar to massive scale, but only if you steer them to catch the prevailing winds.

Regular listeners of this show know that I often compare the entrepreneur’s journey to jumping off a cliff and building a plane on the way down. But some founders do something even more daring. Instead of scrambling to build a jet, they craft the simplest possible glider. They strip out every part of the plane you would think they’d need to stay airborne — the engine, the propellers, the wheels – and they coast on the prevailing winds. 

A glider is the model of simplicity. And with the right pilot, simplicity means agility: the ability to swoop enormous distances and soar to great heights, so long as you know precisely when and where to catch the right updraft.

It’s the same with companies. A simple business idea can soar to scale, if the founder knows how to read — and ride — the prevailing winds.

I wanted to talk to Kevin Systrom about this because he and his co-founder Mike Krieger achieved the impossible with Instagram. Not only did they launch a dead-simple app that blew up the internet but they did it with the smallest, simplest staff imaginable. Only 13 people worked at Instagram during its first 18 months, when it reached 30 million users. That’s well-more than 2 million customers for each team member.

Let’s face it: This ratio is nearly impossible. And frankly, I don’t recommend it. But Instagram-style simplicity is worth pursuing. Kevin and Mike were able to massively scale a simple product with a teeny team because they were masters at drafting off of the prevailing winds in technology. They also knew exactly where to invest their own resources in order to create something people loved and wanted to share. 

And Kevin has been sharing things he loves for a long time. Before photos, he shared music. His method was low-tech and perhaps a little on the shady side.

HOFFMAN: Apparently, you were the kid who hung an antenna out of the window of your dorm room to broadcast a pirate radio station. What’s the story with that?

SYSTROM: I can neither confirm nor deny the allegations. But let’s say it was true…

HOFFMAN: Hypothetically.

SYSTROM: Hypothetically speaking. At my boarding school, I was really into music and radio and deejaying. I had two turntables and I loved electronic music back when electronic music was really uncool. And I still remember all the kids looking at me like, “What are you listening to?” I was really into the idea of broadcasting music and having a relationship with a community of listeners and this was before internet radio was like really a thing. Although honestly that probably would have been a better idea.

HOFFMAN: Kevin’s musical taste wasn’t exactly a crowd-pleaser. But he felt a need to share his passion for it. 

SYSTROM: So, literally out of my dorm room, I hung this like big steel antenna on the roof whenever I went live and hooked it up to my turntables and started playing music that no one liked. It was so fun because I remember like the next day talking to someone, “They’re like oh yeah 89.3, that was great for the one hour you went on.”

HOFFMAN: His parents told him he needed to get a job. And in their eyes, being a DJ didn’t count. So Kevin did the next best thing. He got a job at a record store in Boston called Boston Beat. It opened him up to a whole community of people like him, who enjoyed the simple pleasures of digging through crates to find obscure records. And it brought him a whole new audience for his deejaying.

SYSTROM: I also got to go to these clubs and actually sit in the DJ booth watching people do the thing, but I was like 16 in a 21-plus place and I behaved myself, I promise, mom and dad, and I did. I was a goody two shoes.

HOFFMAN: And was that DJ experience any of the kind of early glimmers of now thinking about social networks later? Was there any of that kind of social pattern and that from the DJ booth?

SYSTROM: I, you know, it’s all connected, which is, you know, when I did sports as a kid I was the goalie; when I played baseball, I was the pitcher. I always wanted to be in the center of it and not controlling it, but I wanted to be in the center of it and the DJ is kind of the same thing, right? So, the early glimmers of, I think, wanting to start a company and lead people in a specific direction, sure like that relates a lot to, whether you’re the goalie the pitcher or the DJ, you’re in these types of positions. 

HOFFMAN: Those glimmers came into focus at Stanford. Kevin studied Management Science and Engineering. He took that fateful trip to Florence. He also built web apps in his spare time, including a photo sharing app for his friends. When graduation came around in 2006, he took a job at Google.

SYSTROM: The next two years at Google were so influential for the rest of my life because I saw people working hard, building products that sometimes worked, sometimes didn’t, but I saw the process of building. 

HOFFMAN: Kevin soon moved from a team that was building new products to one that was charged with acquiring them. He loved it. But there was one problem. It was 2008 and the market tanked after the financial crisis. And Kevin? He got bored.

SYSTROM: I was complaining, “Hey, like the market crashed. We’re not buying any companies. What should I do?” And one of my coworkers was like, “You should pick up golf.” And like un-ironically, just like looked at me and was like, “Learn to love golf.” At that very moment in my head, it was like, “Ding. You’re leaving.” I was just like, “I’m 25 or -6 or whatever”, like “I’m too young to go pick up golf.”

HOFFMAN: Kevin fled the fairway for a travel startup called NextStop, founded by some former Google colleagues. For Kevin, it was the startup life he had yearned for.

SYSTROM: NextStop was so influential because number one, I was a marketing guy there, like they asked me to join as basically marketing and growth. Like, how could we grow the service? I was pretty bad at that actually, like I’m not sure I ever helped grow it. I tried, I really did. 

HOFFMAN: That’s right, Kevin Systrom, the man who would co-found one of the fastest-growing tech companies in history, was bad at growth. But NextStop ignited Kevin’s desire to build something himself. He studied the code that NextStop was based on, and learned the basics of building a scalable web app. Soon, he was building his own projects outside of work. He tinkered at night and over weekends. One of these side-projects was a check-in app he called Burbn. Though he spelled it B-U-R-B-N.  

SYSTROM: Remember Mafia Wars? 

SIRI: Mafia Wars is a hugely popular online game created by Zynga. For more information, listen to the Masters of Scale episode with Zynga’s founder, Mark Pincus.

SYSTROM: I had this idea that Mafia Wars would be great in the real world. Like instead of fighting for territory in the digital domain, like imagine like, taking over a pizza parlor digitally or taking over, you know your favorite bar because you checked in a few times. You could join families and war against each other and that’s why it was called Burbn, because it was supposed to be like speakeasies 1920s, whatever.

HOFFMAN: Burbn was a simple app. Sometimes, simplicity is intentional. Other times, it’s foisted upon us by limitations: in time, in resources or, in Kevin’s case, his own abilities.

SYSTROM: It turns out, like I wasn’t good enough to build all of the gaming features. So it was just a check-in service and I gave it to my friends and they started using it.

HOFFMAN: This was a time when check-in apps were big. VCs were pouring money into things like Foursquare and Gowalla. If Kevin had persisted in trying to build gaming features for Burbn, he probably wouldn’t have found a backer. But he had kept it simple. And he got some attention. One VC made him an offer. But… it came with a condition. 

SYSTROM: One of the VCs was like, “Hey, like I’ll give you money to do this but you have to find a co-founder.” I was like, “What, like I can do this, like I’m …” He’s like, “No, no, no, like all companies I fund, you have to have a co-founder.” 

HOFFMAN: I agree with this unnamed VC. In my experience, two co-founders are almost always better than one. And three co-founders are frequently better than two. We have another episode planned on this entire topic. 

In his search for a co-founder, Kevin crossed paths with Mike Krieger, an old college friend who brought the engineering heft to balance Kevin’s product development credentials.

SYSTROM: We just hit it off. He’s one of the nicest guys I know, super humble but so sharp. I think we’ve just had a compatible work relationship for the last eight years, but it all started then and we took a bet on each other. 

HOFFMAN: Kevin and Mike clicked instantly. But they struggled to push Burbn beyond 80 users. And most of those 80 users were their friends.

SYSTROM: We worked on Burbn, our friends liked it but no one else like that. And I’m like, looking back, I’m actually surprised anyone gave us money to work on this idea.

HOFFMAN: Growth was stagnant. Kevin and Mike examined their options. They identified the three most popular features on Burbn and decided to focus on just one. The features were: checking in at locations; coordinating visits with other users; and uploading photos when you checked in somewhere. As you’ve probably already guessed: they chose photos. 

HOFFMAN: What was the insight to we have to prune everything else away, right? Like we just have to say, okay, “This is the thing. Everything else goes.” Because there’s a natural tendency, say, “Well, but people like this and we’re getting some positive user feedback and you know we put some energy into it so we won’t develop it, but we’ll leave it.” What was the “it must all go, this is the thing”?

SYSTROM: I think it was about trying to have a clear story to tell people when we were introducing it to them. I like to say, like, products that do too many things that aren’t adjacent, like how do you explain, like if you’re going to tell a friend about a cool new service that does all these things like, how do you explain it to them?

HOFFMAN: This is one of the things I love about Kevin’s approach to product. He understands that he needs to excite users. But he also needs them to tell their friends. And if they can’t do that in a single sentence, they’re less likely to do it at all. So Burbn, the check-in app, became Instagram, the photo app.

Kevin and his co-pilot Mike had jettisoned the dead weight. They had decided on the basic structure of their glider. And they had identified the first gust that would propel them on their journey. Now it was time to bank hard to capture that breeze. They did this by creating Instagram’s killer app: its filters.

Kevin wished could take credit for it. But he says it was actually his wife’s idea. It came to them during a trip to Mexico.

SYSTROM: We rented a little room in a bed and breakfast and I was working on Burbn at the time and we were pivoting to photos but she was like, “I don’t think I’m going to ever use this app.” I was like, “Why not?” She’s like, “Well, my photos aren’t good.” And I was like, “Well, that’s fine. You can post photos. It’ll be good.” And she goes, “Well, they’re not as good as your friend Greg’s.” I was like, “Well, Greg filters all his photos.” And she looks at me and she’s like, “Well, you should add filters then.” I was like, “Ah, you’re right. I should add filters.”

HOFFMAN: I hear stories like Kevin and Nicole’s all the time. Entrepreneurs take note: An honest partner is always your best source of ideas. Kevin was smart enough to listen.

SYSTROM: I went back to the bed and breakfast room and with a dial up connection to Mexico, of all places, I was looking up code on how to change colors and photos, and I made the first filter there on the spot. It’s still in the app, called X-Pro 2.

HOFFMAN: X-Pro 2 was one of the 11 original filters that Instagram launched with. Each of the distinctive filters added the kind of blurred edges, color wash, and light leaks that gave even mediocre photos a sense of nostalgic meaning. 

And when Instagram launched, there were a lot of mediocre photos. Phone cameras were still primitive. 

SYSTROM: Many years later when I looked at the idea of having this kind of like not so great iPhone 3G camera, I mean, back in the day I was kind of blurry, effectively like a toy digital camera and I was like, you know, the goal here isn’t to make this beautiful, the goal is to like deal with the imperfection. So that’s like honestly where the inspiration came from.

HOFFMAN: So, like the iPhone 3 cameras are like little mini digital Holgas.

SYSTROM: Totally. 

HOFFMAN: It was as if Kevin and Mike had handed each of their friends a Holga, and told them not to sweat the details. Instagram will give your snaps the wow factor. All you need to worry about is pointing and shooting.

SYSTROM: Any person we gave it to, their eyes lit up because they were like, “Oh, like my photos seem so much better now.” And that was the moment when we realized, “We think we have something.”

HOFFMAN: Filters were the simple feature that set Instagram apart. But Instagram also made it simple to share those beautiful photos. And this was its true secret to scale. 

SYSTROM: I remember hearing from people. They’re like, “Wow, I just got a like.” And I was like, “Yeah, because it’s a network.” And they’re like, “Oh, I didn’t realize that. I thought it was just a camera app.”

HOFFMAN: Before Instagram, other photo apps kept people inside them. They didn’t create a network in the app, and they didn’t leverage social networks. But here, with instagram, the loop was piggy-backing on all these existing networks. 

SYSTROM: We had Tumblr, Posterous, Twitter, Facebook, I’m trying to remember the other one’s, Foursquare, I think.

HOFFMAN: Instagram wasn’t the first mobile app to offer photo filters, but it was the first to tap seamlessly into the social network ecosystem. What it did better than any other app to date was leverage these new networks to enable massive scale. These networks were like the trade winds that let Instagram soar, almost effortlessly. 

SYSTROM: The problem is that you have this app that’s a network, but no one’s on the network and it only becomes useful once people are on the network. So you have to have what we called the “single player mode” feel awesome. And it turns out single player mode is a app where you could take a photo filter it and share it to many networks at once, that was utility in “single player mode”, like no one else needed to use Instagram at the time to make that useful. It was a tool for you. 

But if we wanted to get lots of people downloading it, they’d have to see the photos, the output. And it just turns out the square photo and the borders and the links to Instagram were calling cards, which effectively said, “If you like what you see, you too can go do this exact thing, download this app.”

HOFFMAN: Instagram was an Insta-hit. On its first day on the App Store: 25,000 downloads. Within a week: 100,000. Within ten weeks: 1 million users. Instagram had entered multi-player mode.

The viral loops were kicking in, with some strategically placed help. Kevin and Mike had put the app in the hands of 100 artist-influencers. And it paid off.

SYSTROM: So we went out, we got all these influencers who are photographers and designers to sign up and I think we had 100 people sign up, and the day we launched, they started posting all their photos to Twitter and to Facebook and we figured out the viral loop to help it grow and it just exploded.

HOFFMAN: Simplicity, combined with the leverage of all these outside forces, is what allowed Instagram to scale. 

However, to maintain that scale, simplicity is not enough. You may remember a slew of simple Facebook games called things like “Zombie vs Werewolf”. You’d get bit by a Zombie or a Werewolf. Then you’d turn into one. You would then bite your friends to try and recruit them to your team. It was simple. And fun. And reached massive scale. And then? User numbers tanked. It was entertaining for a bit. But it didn’t tap into an ongoing need or desire. 

In order to scale, you have to tap into a fundamental human need. That feeling of being connected, of being a part of the tribe, is the fundamental need that let Instagram scale to a huge number of users and persist.

Instagram scaled fast from day one. It was as if they steered their glider straight into gale-force winds. The night of the launch, their servers crashed. Kevin put out an SOS.

SYSTROM: I called up my friend Adam D’Angelo who was CTO at Facebook, I think he had left at that point, but he knew how to scale a very large service or at least a service of our scale.

HOFFMAN: Just as Instagram, the app, soared by drafting off of much larger social networks, Instagram, the company, drafted off the founders’ social networks. That night of the launch, Adam talked Kevin and Mike through how to stabilize their servers. They set up a text alert for when their servers went down. That ringtone haunts Kevin to this day.

SYSTROM: Every time I hear that ringtone today it literally makes my insides turn. Because like the number of times our servers would go down at 2:00 am or I’d have to step out of a birthday party or miss a concert whatever like, too many to count. So, I now have a mild form of PTSD with that specific sound.

It’s the only true, I think, fight Mike and I have ever had, which was: we were scaling and he was like, “We’re going to need another server.” And I was like, “No, we don’t.” And it was because, I don’t know, I was really cost-conscious and like it was going to be expensive to start up a new one. I mean not expensive in today’s terms but, I remember that was the one really big disagreement we had and it lasted about a minute and then we’d calm down and I was like, “You’re right.” 

HOFFMAN: I think there may have been more to Kevin’s reluctance than cost-consciousness. Kevin was still in early-day founder mode. He was hungry for the thrill of the fight. And this perhaps led him to equate simplicity with doing everything on a shoestring. In this case, keeping their server count down was not the simple solution. In fact, it added complexity  

It’s an easy and ironic trap to fall into: by trying to stay true to simplicity, you overthink things. And before you know it, you’re in a tangle of complexity. It’s a pitfall that comes in many guises, and one we may not even realize we have stumbled into. Someone who has spent a lot of time thinking about this issue is Rohan Gunatillake. He’s the creator of Buddhify, the app that helps people make meditation a part of everyday life.

ROHAN GUNATILLAKE: One of my favorite definitions of meditation is that meditation is a training in simplicity. From a mindfulness perspective, I would say that simplicity and complexity are actually not the opposites of each other. If you look at it in a different way, simplicity is what’s here and complexity is what we lay on top of it. 

HOFFMAN: Note that Rohan isn’t saying complexity is necessarily bad. But it is something humans have a tendency towards. But there is a simple way to avoid it.

GUNATILLAKE: Turning inside with our attention and noticing what’s there whilst it’s happening. Really simple. 

So, for me right now as I’m sitting here doing this interview, talking to you, what’s happening is calm, warmth, amusement, relaxation, not sure, calm, tingling. So, that’s basically my experience. So what I was just doing there was a type of technique called “out loud noting”, it’s actually one of my favorite techniques. That experience, those words, were an expression of what was happening inside myself. It wasn’t particularly sexy or dramatic, but just the reality of my inner experience. There’s a beautiful simplicity to that.

HOFFMAN: But even when we’re trying our best to glide towards simplicity, these efforts themselves can bring us into complexity.

GUNATILLAKE: Along the way, sometimes, some of us can get fixated on the process as opposed to the outcome. Suddenly, the startup is more important than solving the problem. Suddenly, my status as a meditator is more important whether I can actually be present with my two year old when I’m playing with him. 

I see it all the time in both of those worlds and I think a really powerful thing to do whether you’re thinking in the context of business or in the context of mindfulness practices is that every time you’re practicing, remind yourself why you are doing it. That will give you the orientation, the energy, and the inspiration to avoid falling into that pitfall or that trap. It’s something I’ve done several times in the past, both on the business side and the meditation side. 

HOFFMAN: Kevin and Mike made brilliant choices to keep their product and staff simple. Remember those numbers? They ran a massive service with the leverage of just 13 employees. They were able to keep their staff small because of the specific decisions they made to keep their product simple. They simply didn’t do things that other companies would have considered vital. Instagram was an iPhone app. It wasn’t on the web. It wasn’t even on Android. They didn’t make any revenue, so they didn’t need sales. They didn’t need payments. 

These choices allowed them to stay small. And there are huge benefits to having a small, massively leveraged team: It’s easy for everyone to cohere. Communication is simple. Costs are seriously low. And it’s maximum productivity per individual. Everyone feels the importance of the mission and understands their place in it. 

But with only 13 employees, Kevin took this to the extreme. Even he doesn’t recommend it.

SYSTROM: This is painful to relive. Mostly because I look back and our lives for those first two years would have been so much better had we just hired. I love leverage and I love, you know, the fact that we were able to scale a service with 13 people. I mean, we were like, on average, like six people for that first year, we only hired up to 13 right before we got acquired. So, whenever people are like, “Oh, 13.” I’m like, “Actually it was more like five or six.” Our lives would have been a lot easier. So lesson number one is find great people that know their stuff because there are a lot of them in the world and they would be happy to deal with the problems that you’re currently facing. That is the lesson number one of growing a company.

HOFFMAN: By early 2012, the viral loop was in overdrive. Users flocked to Instagram. And the more they came, the more unstable the service got. Kevin and Mike knew it was time to invest big in infrastructure. They needed servers. They needed data analysis. And they needed people. But they were yet to see a dollar from Instagram itself. They did a deal with a group of investors, including Greylock. But just days after, Kevin announced that he had done a deal with Mark Zuckerberg. Facebook would pay $1 billion to acquire Instagram.  

SYSTROM: The decision to sell was mostly about whether or not we were aligned in our vision of Instagram and I think Mark and I both saw at the time that Instagram was a special thing. It wasn’t going to be like, “Oh, we’ll buy this thing and it’ll just be Facebook Photos.” Like, “We’ll rebrand it as Facebook Photos.”

It’s a unique community and had a unique angle and he wanted to invest in it. And that’s the way I look at it, it’s kind of like we switched investors and we had a new board and that board became some of the smartest technologists that Silicon Valley had, which was the Facebook management team.

HOFFMAN: When Facebook acquired Instagram, some people snickered at the billion dollar price tag. But investors didn’t. It was seen as the total bargain of the century. For Facebook, the deal was a leg-up into mobile. 

As for Instagram, it now had access to the resources that would propel growth even further. This meant no more late-night text messages about crashing servers. The ghost of that ringtone was banished.

SYSTROM: We had a pretty broken infrastructure, because it was duct taped along the way and I don’t regret that at all, like we had to duct tape it along the way, but we spent the first month or so stabilizing. It turns out stabilizing helps growth, because it’s more stable people enjoy it more, people can sign up more reliably.

HOFFMAN: Now Instagram might have gotten to even greater scale without being acquired, but there was a bunch of stuff that Instagram got from Facebook. It got scale infrastructure in terms of how to handle all the data loads and build scaling servers. It got detailed ad targeting and systems, and a sales force for doing it. Instagram could have built these things itself but it would have taken time and it might not have worked. Meanwhile, Facebook and others could build their own Instagram competitors.

In Facebook, Kevin and Mike saw a powerful wind that could take them to an entirely new level of scale. Facebook gave them this new updraft of scale. Facebook also had something else: a sophisticated means of measuring and capitalizing on user growth.

SYSTROM: And I believe they had pioneered this, was the growth accounting formula, which is okay like your net growth on any given day, you can break it up into separable parts: It’s how many new people came in the door, how many people decided to stop using you, and then how many people who used to use you decided to use you again.  Plain and simple, those three terms equal net growth.

HOFFMAN: This analysis meant Kevin and Mike could hone the viral loop.

SYSTROM: There were a bunch of those critical numbers early on that then we kind of started to instrument and realize, “You know what, like what percent of users get this number of followers in the first week?” And we could track that and then ask ourselves, “Hey, how do we drive more followers to people and how do we make sure that new users get enough engagement on their first few posts?” Without measurement, you’re kind of wandering around in the dark and you’re not able to produce something that has product market fit.

HOFFMAN: But even with this influx of resources, there was one thing Kevin and Mike were determined not to change: their commitment to keeping Instagram simple. 

SYSTROM: Our first value meeting, when we read out our values, the first one on the list is keep it simple. When we started Instagram we went from solving three or four things to solving one really well and we saw that pay off in spades. And I think the hard part is when you grow a service and let’s say you have hundreds of millions of people using it, you have varying use cases. You have varying stakeholders: some are businesses, some are celebrities, some are video stars, and some are creatives. You have pets on Instagram, right? Like how do you keep it simple when you have so many people use it?

HOFFMAN: To this day, they have regular meetings so the whole team can re-examine the app.

So Kevin thinks long and hard about adding new features. And he will only do so if there is a clear case for them. Often, that means spotting any interesting or unexpected ways people are using his product.

SYSTROM: So when we added video to Instagram, that was a big move. That’s an evolution of how people were already using it stories. Same thing. Messaging, people do it all the time in comments. So adding complexity is okay as long as you don’t add orthogonal use cases that feel totally unrelated. When we do that, we typically launched separate apps or we consider doing that.

But I think it’s important not to just like not build features. I think it’s important just to think about the number of use cases that you have and ask yourself: are you keeping those in a limited set?

HOFFMAN: It’s something worth asking yourself on a daily basis. But don’t let it turn into an exercise in self doubt. Many ideas require careful thought, but they also need swift and decisive action.

SYSTROM: Far too many times entrepreneurs assume that things aren’t reversible. Jeff Bezos talks about one-way doors. He likes employees to make decisions quickly when there are two-way doors or revolving doors. But when there are one-way doors, think long and hard. And I think often people confuse one-way doors and two-way doors.

HOFFMAN: There’s a danger if you rush through a one-way door that you won’t be able to find your way back inside. But the greater danger is not taking any doors.

SYSTROM: If you don’t change the service, I think the world changes underneath you and you become less relevant. So the lesson is to not, not change the service, but rather what do you change it to? And when you change it, how do you keep it feeling simple? 

HOFFMAN: This philosophy of Kevin’s, like Instagram itself, is a study in simplicity. Kevin knows that the winds around him are changing constantly. And in order to stay aloft, you have to steer toward the most powerful prevailing winds. You might even need to redesign your glider. But it has to remain simple.

I’m Reid Hoffman. Thank you for listening.

Masters of Scale’s mission is to democratize entrepreneurship. Launched in 2017 as a weekly podcast featuring Reid Hoffman, we’re now two weekly podcasts — Masters of Scale with Reid Hoffman, and Masters of Scale: Rapid Response, hosted by Bob Safian — as well as an award-winning daily learning app, a best-selling book, virtual and live events, and more, serving a global community of founders, funders, and leaders looking to innovate at scale.
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