Any developer of an internet app that people are actually using is likely raising venture capital at present, and Instagram is set to receive $50 million at a $500 million valuation after wrapping up a Series B round led by Sequoia Capital, according to sources close to the dealings. The maker of the growing photo-sharing application, which recently found its way to Android, may also get an assist from DST Global.
Without any revenue coming in, some have been skeptical of Instagram's $500 million valuation, but this has not seemed to have had any affect regarding people wanting to get in on the deal. A year ago, Instagram first received Series A funding of $7 million from Benchmark Capital, when it had roughly 1.75 million registered users. Last week, the company had 30 million iPhone users just before it launched on Android, quickly adding another million in 12 hours.
Instagram CEO Kevin Systrom hasn't commented on the fundraising. The company had 13 employees in its San Francisco office at last count.
In related news, a recent study has shown that the over posting Instagram pics on Facebook might get a user defriended by their peers.