Amin Zoufonoun, who heads up Facebook’s mergers and acquisitions (M&A), defended the company’s Instagram purchase in a Facebook post amid investigations by lawmakers and regulators, CNBC reported on Thursday (Nov. 14).
“I want to acknowledge that in some ways, we absolutely considered Instagram a competitor,” Zoufonoun, Facebook’s vice president of corporate development, wrote in the post on Monday (Nov. 11). “Since there has been a fair amount of chatter on that point, I think it is important to explain a little more about this.”
The social media giant is in the midst of four separate antitrust investigations in addition to calls to break up the company from Facebook co-founder Chris Hughes and Democratic presidential candidate Sen. Elizabeth Warren.
Zoufonoun, a former Google executive, was a guiding force in Facebook’s $1 billion Instagram acquisition in 2012. The deal closed on the heels of Twitter’s $500 million Instagram bid.
In his post, Zoufonoun noted that the mobile photo-sharing space was crowded, pointing to Foursquare, Path, VSCO Cam, Viddy and Snapseed.
“It was a highly volatile space, and it wasn’t at all clear who would stick around and who would fade away,” he wrote. “Our hope was to bring together social networking and mobile photo sharing. But without question, this was a big, unproven bet at the time.”
At that time, Instagram was struggling with the infiltration of spam and had no plan in place to make money.
“Since many startups are held back by weak execution on basic issues, helping Instagram get past these hurdles made it much more likely to succeed,” Zoufonoun said.
In August, Facebook reportedly dropped a deal to buy competitor Houseparty, the video-focused social media chat app, due to anticipated additional antitrust scrutiny. The Houseparty platform draws youth under 24 and features group video chat. Fortnite maker Epic Games purchased Houseparty in June by for an undisclosed amount.