Bloomberg has reported that Instagram co-founders Kevin Systrom and Mike Krieger left the company due to the growing influence of Mark Zuckerberg, CEO of its parent company, Facebook.
Facebook acquired Instagram in 2012 and initially largely left Systrom and Krieger to their own devices while equipping them with the company’s incredible resources.
The relationship has since soured, however, with Mark Zuckerberg increasingly involved in the day to day operation of Instagram, a move that apparently hastened the pair’s exit from the social media platform.
Investors were spooked by the pair’s surprise exit and more than US$11 billion was wiped off Facebook’s market value.
Instagram founders' exit means there's no one to challenge Mark Zuckerberg https://t.co/hP4k6Ty4p7
— Bloomberg (@business) September 26, 2018
The Instagram co-founders were increasingly unhappy with company’s direction, loss of power
Systrom’s statement on their exit painted the move as driven by a straightforward desire for a change of scenery.
“Mike and I are grateful for the last eight years at Instagram and six years with the Facebook team,” the statement read. “We’ve grown from 13 people to over a thousand with offices around the world, all while building products used and loved by a community of over one billion. We’re now ready for our next chapter.
“We’re planning on leaving Instagram to explore our curiosity and creativity again. Building new things requires that we step back, understand what inspires us and match that with what the world needs; that’s what we plan to do.”
More recent reports have pointed to disagreements between the pair and Zuckerberg over Facebook’s decision to remove Instagram branding from posts shared between the two social networks. There was also disagreement over changes to how comments are displayed and Facebook’s move to add notifications inside Instagram inviting people to open Facebook.
Instagram's founders are leaving. That's really bad news for Facebook https://t.co/tiOk6yvB2S
— TIME (@TIME) September 26, 2018
Facebook is reportedly set to introduce a function similar to a retweet to Instagram to allow the easy sharing of content from other users. Systrom and Krieger had previously rejected the idea.
Another factor in Systrom and Krieger’s growing unhappiness was the move of former Twitter executive Kevin Weil from Instagram to Facebook’s blockchain unit. Weil had been hired by Systrom and helped the company strategically introduce Stories to combat the growth of Snapchat. When Weil left, he was replaced by Adam Mosseri, who reported to Chris Cox, one of Zuckerberg’s most trusted allies. That piece of corporate musical chairs pushed Systrom further to the periphery of his own company. “Kevin didn’t have a voice at the table,” one Facebook insider said.
With the departure of Instagram's founders, Mark Zuckerberg can consolidate his power https://t.co/IOPQlrfzRR
— VANITY FAIR (@VanityFair) September 26, 2018
Instagram had continued to grow as part of the Facebook stable
Instagram was essentially allowed to continue as an independent entity within Facebook for a time and it despite its jaw-dropping price tag, it proved a canny acquisition (some analysts believe it would be worth up to US$100 billion as an independent company) and an important valuable strategic asset for Facebook. Crucially, it continued to be popular with teenagers, who are exiting Facebook en masse.
Facebook has seemingly hit a wall after amassing more than 2 billion users and has recently been beset with controversies including the infamous Cambridge Analytica scandal and ongoing concerns the platform is being hijacked by fake news outlets and malicious actors seeking to influence US elections.
Concerningly for Zuckerberg, the exit of Krieger and Systrom continues a trend of worsening relations with the leadership of the companies Facebook has acquired. Earlier in 2018, WhatsApp CEO Jan Koum left after ongoing differences of opinion with Facebook management, particularly over the issue of user privacy. Oculus CEO Palmer Luckey also quit Facebook after a series of scandals, including being ordered to pay another company for violating a non-disclosure agreement.
It is not clear what the seemingly inseparable Instagram co-founders will do next but it is believed they intend to continue working together.