One of the most popular iPhone apps, Instagram, is working to secure a new round of financing that would value the photo-sharing social network around $500 million, reports the Wall Street Journal

Founded in 2010 by Standford graduates Kevin Systrom and Mike Krieger, Instagram quickly became one of the most downloaded apps in Apple's App Store. It boasts nearly 20 million users, and was named Apple's 2011 App of the Year.

Instagram's current round of funding is hoping to raise $40 million and, according to WSJ, is attracting a lot of interest despite some venture-capital firms hesitation to invest in a company that has yet to display a proven revenue model (the app is free and devoid of advertising).

What do you think? Is Instagram worth the dough? Is it just another over-hyped startup?

[via WSJ]