Instagram Is a Terrible Example of Immigrants Creating American Jobs
During his immigration speech on Tuesday afternoon President Barack Obama cited the Brazilian born Instagram co-creator Mike Krieger as an example of the potential jobs and money a non-American can bring to our country, a strange choice considering how teeny-tiny the photo-sharing app industry is.
During his immigration speech on Tuesday afternoon President Barack Obama cited the Brazilian born Instagram co-creator Mike Krieger as an example of the potential jobs and money a non-American can bring to our country, a strange choice considering how teeny-tiny the photo-sharing app economy is. "Instagram was started with the help of an immigrant who studied here and then stayed here," said Obama, a true statement, as Krieger, who created the app with Kevin Systrom, hails from Sao Paolo and went to Stanford. Things have turned out great for Krieger and becoming fabulously wealthy with a good idea (filters for phone cams!) and hard work (sell company for $1 billion) is the gold rush kind of story that has brought people to America for centuries now. But, as far as the rest of Obama's point goes, that talented immigrants plus innovation equals boom times for everyone, Instagram is not, as we've noted many times before in our discussion of the Selfish Social Media Bubble, is not the example for how tech can create jobs.
This is what Obama said:
Right now in one of those classrooms, there is a student wrestling with how to turn their big idea, their Intel or Instagram, into a big business. We are giving them the skills to figure that out, but then we are going to turn around and tell them to start the business and create those jobs in China, or India, or Mexico, or someplace else. That is not how you grow new industries in America. That is how you give new industries to our competitors. That is why we need comprehensive immigration reform.
As far as "job creation" goes, before Facebook bought the filtered-fun photo-sharing app, Instagram had a whopping 13 employees*. That's its own type of success, even if "innovation" is a looser term here. (Instagram borrowed its general idea from a lot of similar apps.) On the business side of things, it made zero dollars. The only money that ever came out of that app came from Facebook, which purchased it for $715 million. Even to this day, the social network generates no revenue from all those likes and shares. That, of course, will probably all change soon. But, as an example of a big economic success for the United States, Instagram doesn't make sense, at least not yet.
Instagram more likely got the coveted Obama name-drop because it's cool to namedrop. Obama wants us to equate things we love with immigration reform. The point Obama wanted us to hear was this thing you people have heard of, it happened because America let an immigrant stay for good reasons. That's a pretty big deal for Instagram, but the real danger, is, as our own Dashiell Bennett noted, that "Presidential name drop = Officially uncool."
*This post originally stated Instagram had 4 employees when Facebook purchased it. It started off as a four person company, but had grown to 13 by the time the acquisition came around.