Instagram, the photo-sharing app that has taken a definitive lead on iOS, said it has surpassed 27 million registered users today at the SXSW Interactive conference in Austin, Texas. Co-founder Kevin Systrom didn’t disclose daily active users during his fireside chat with TechCrunch editor Alexia Tsotsis. But he did say of all the users who have been active in the last week, 67 percent of them used the app yesterday. “It’s Facebook-level engagement that we’re seeing,” Systrom said. He didn’t really offer any clarity on rumors that the company is raising $40 million at a $500 million valuation. “Good companies are always fundraising,” he said. “Whether you’re meeting people or considering firms, you’re always fundraising. But it doesn’t mean we’re active. We’re trying to create a long-term, viable company that doesn’t come and go with fads. It should be something that lasts and creates meaningful value.” Systrom also had one more thing up his sleeve — he showed off the company’s upcoming Android app. He waved it around very briefly on-stage, but he didn’t give a full demo. (That’s for later, and the company tells us they aren’t totally ready for a walkthrough yet.) “In some ways, it’s better than our iOS app. It’s crazy,” he said. Co-founder Mike Krieger added that folks over at Android have been pretty impressed with the way the app leverages the platform. It’s taken awhile to come to Android simply because the company was focused on scaling on iOS, Systrom said. “I don’t think it took us so long. We just had priorities. Had we tried to be both on Android and iPhone at the same time, it would’ve been tough to innovate in the way that we have,” he said. He was also coy about what Instagram’s business model will ultimately end up being. The app currently doesn’t have any advertising and it doesn’t have any in-app purchases. Path, in contrast, sells some filters. (But it also has far fewer users with the latest publicly shared figure being 2 million registered users.) “We have a visual platform and advertisers like visual mediums. They like TV and magazines, but attention is moving online and they want to switch,” he said. “I do believe that Instagram has put a stake in the ground and we’re growing more quickly than anyone. Is there something in there we could do to make it a multi-billion dollar business? I think we can figure out something along the way.” Launched in the fall of 2010, Instagram grew out of some unsuccessful experiments in location sharing. While the company would have been too late to a crowded space that included Foursquare and ultimately Facebook Places, Systrom and Krieger saw that their beta users were sharing tons of photos. “I was not super pumped up about location-based services. But I saw that what Kevin was doing was more about sharing the story of a place,” Krieger said. Systrom added, “Burbn never really failed. We just never really let it fly.” They quickly turned around a native iOS app that seemed to marry elements of paid camera app Hipstamatic with social features. It was perfect timing since the iPhone 4 was just arriving on the market and the device finally had a camera that produced photos of comparable quality to what point-and-shoot cameras could do. Apple also had an installed base of iOS devices that was finally large enough to produce the network effects that Instagram needed to take off. “Mobile has created a totally different dynamic for discovering apps,” Systrom said. “You’re sitting in a bar and your friend is taking some pictures and then you ask what app they’re using.” The app was soon a home run that quickly secured a top ranking among photography apps and then a consistently high ranking on the free app charts. On the first day, 25,000 registered users showed up. The challenge soon became about scaling the back-end and infrastructure. “From then until now, it’s been a hockey stick,” Systrom said. “We’ve been very lucky with scaling. The difference is that we’re served out of the cloud and we can call up instances with the demand. We also have a fantastic team that focuses on scale.” Just months after that, the company picked up a $7 million Series A round led by Benchmark Capital, with participation from Baseline Ventures, Square CEO Jack Dorsey, Chris Sacca and Quora co-founder Adam D’Angelo. Benchmark partner and Facebook alum Matt Cohler joined the board.
