Zuckerberg Flies Solo.

Facebook’s Inc. CEO signed, sealed and delivered the deal between his company and Instagram, without asking for his board of directors advice or consent, according to The Wall Street Journal. On April 8th, Mark Zuckerberg informed his board of directors that he full well intended to purchase Instagram, the popular photo-sharing service.

The Instagram deal, cut solely between Kevin Systrom co-founder and CEO of Instagram and Zuckerberg, opened and closed the deal within 3 days, and became the largest acquisition for Facebook so far. Systrom initially asked for $2 billion, and negotiated said deal during several meetings at Zuckerberg’s home in Palo Alto, Ca. The 2 parties, both in their 20’s, agreed on a final sum of $1 billion.

During negotiations, Zuckerberg, who had planned to pay for Instagram with stock, asked Systrom what he thought Facebook would be worth, those familiar with the deal stated.  If he believed Facebook would one day be worth as much as a company like Google at $200 billion or more, then the equivalent of 1% of Facebook would be sufficient to meet his price, Mr. Zuckerberg told Mr. Systrom, according to said insiders. When you consider that Instagram only makes one product, and gives that product away for free, traditional ways of valuing the company didn’t apply ( i.e. cash flow, or each and every part of the company picked apart), this seemed to be the best way to agree on Instagram’s worth.