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Facebook suffers another big blow

July 9, 2021, 5:55 PM UTC

Facebook’s “big blue app” and its 1.8 billion users are losing a leader.

Fidji Simo, a longtime Facebook stalwart who ran its main app and helped the company introduce key features like video and livestreams, will be taking over as Instacart CEO, succeeding its founder Apoorva Mehta.

Instacart, a grocery delivery service, was last valued at $39 billion in March, and is reportedly preparing to IPO in coming months. Simo had served on the Instacart board since the beginning of 2021, and will start as CEO on August 2.

The departure is a two-fold blow to Facebook. Simo played a key role as the head of the main “big blue app” on mobile devices, and the company loses her decade of institutional knowledge, working on initiatives from the news feed, mobile monetization, and ever-important video. 

But her departure also leaves a staggering void inside the company’s leadership.

Bloomberg reports that Simo will be replaced by her second-in-command, Tom Alison, meaning the top product executives at the social media giant are now all men. And as Fortune’s Emma Hinchliffe has noted, the latest diversity report suggests women hold just 34.2% of Facebook’s leadership roles.

Simo is leaving Facebook as it faces a decline in consumer trust, a federal antitrust case, and scrutiny over viral misinformation plaguing the website. But she also faces an uphill battle at Instacart.

The grocery startup will have to figure out how to justify its $39 billion valuation, which shot up from $14 billion in June 2020 during the pandemic, and previously from $8 billion when it raised money in November 2018.

Instacart is in a crucial period in which it must demonstrate that people actually want to use the service when they’re not forced inside their homes, now that vaccinations are widely available and people can return to a more typical in-store shopping routine.

Instacart also relies on a vast network of gig worker shoppers, who have claimed unsafe working conditions through the pandemic and had previously tried to unionize. The company fired all workers who had unionized, as part of a larger layoff announcement. The company will have to also contend with keeping these gig workers happy and on the platform, at a time when gig work is becoming increasingly unpopular.

As for the future, Simo doesn’t just see Instacart as a delivery service. Her vision for the company is inspired by her time at Facebook, she told CNBC, There, she saw new companies built on top of Facebook ads, which they used to target and sell products directly to users. Similar new food companies could launch on Instacart’s platform as well. Simo also mentioned adding food content, which could include recipes, videos, or food blogs that would inspire people to buy groceries through Instacart.

Dave Gershgorn


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