Big man is back in business (well, not really): Madrona Venture Group is leading a $4.4 million venture round in Animoto, the fast-growing New York startup that has developed an easy way for people to create interactive slide shows from personal photos. Amazon.com, iStockphoto founder Bruce Livingstone and angel investor Jeff Clavier also participated in the deal, which brings total funding to about $5 million. Pudget Sound Business Journal. The rest of the story on John Cook's Venture Blog: The company also is pushing deeper into commercial offerings. It already has a service for professional photographers, which allows them to create personalized slideshows of weddings, senior portraits or other special moments. The company will use the $4.4 million to add new features, including the incorporation of video and new ways to match images with music.
Some competitors of Fotolia have taken pride in the past months to spread the rumor that Fotolia was already or was about to be sold at that time.
TechCrunch/Erick Schonfeld, in another new article on Fotolia - and no further comment from me - emphasizes that "Fotolia Takes A Massive $50 Million To $100 Million Round" from TA Assiociates, but mentions also "there are some rumors going around in venture circles that Fotolia got sold outright for $150 million. Our source, however, emphasizes that the company was not sold. Instead, after competitive bidding from more traditional venture firms, TA Associates came in with a massive injection of capital."
Now you take your calculator and assess:
The underlying company evaluation, and
The underlying estimation of the microstock image market size.
"Today, Norris' OnRequest Images is announcing that it has raised $8
million in venture capital to boost its sales and marketing. The
45-employee company has raised $12 million to date. [results in $4 million for the First Round]
OnRequest uses the Internet to help match photographers with
companies looking for specialized photographs. The difference between
OnRequest and Getty or Corbis is that its network of photographers
tailors a shoot to a particular company versus having a company sift
through a library of images to use."
"Corbis spokesman Dov Schiff said the company's assignment business,
which includes well-known photographers such as Ed Kashi, Peter Turnley
and Dimitri Daniloff, is growing fast but still represents a small
percentage of overall revenue. For large advertising campaigns such as
Absolut Vodka or Sony PlayStation, Schiff said companies want to
hand-select the photographers and images they use.
"The big advertising agencies don't want four or five people
shooting on spec, they want a specific photographer and they want to
custom design the shoot," he said. "It is kind of like college ball
versus pro ball."
Still, Frazier Technology's Jordan said OnRequest is a "great Web
play" because it efficiently matches the needs of advertisers with
photographers. In that regard, he said it is similar to eBay.
OnRequest Images CEO David Norris, who co-founded the company in
2002 and chose Seattle for the headquarters because of the presence of
Corbis and Getty, said they can offer corporations custom imagery at
stock photography prices.
"People can get exactly what they want, quickly and efficiently and
at a price they can live with," said Norris, adding that the images can
be produced in less than 72 hours and at a cost that shaves millions of
dollars off a traditional photo shoot.
As a result of the investment, Frazier Technology Ventures general
partner Gary Gigot will join the company's board. OnRequest employs 45
people, with plans to double in the next 12 months. It has more than
300 customers, including Procter & Gamble, Charles Schwab and The
OnRequest Images will change the industry like Royalty Free did years ago. The lamentation and whining of some will continue with the same output peak as it happened years ago regarding Royalty Free. For those OnRequest Images will remain an ugly toad, for others (the global network of 1,600 photographers) it is or will become a big nice toad with lots of money in it.
Digital Railroad, the company that went online last year with an impressive broad range of services for professional photographers and photo agencies, today announced that it has secured a $5.2 million in venture capital from Morgenthaler Ventures and Venrock Associates (Venrock is also the VC behind Digit Wireless). I wrote earlier about Digital Railroad, the idea, the concept, the small history of some other companies who acted rudimentary in this special business field earlier and finally how the customers, especially the single professional photographer, might benefit. Yes, the single professional photographer, the mysterious person that had been totally forgotten in the present Stock Photo Industry game of "G. buys ABC" and "C. buys XYZ". Shortly after I published this story in August 2004 Stock Index Onlinepublished an article about Digital Railroad which was apparently wrong on some points. Finally, after some back and forth, Stock Index Online changed the article. The internet party of 1999 is over. Remember, this company does not deal with possessing huge image libraries or vast collections of heritage images like Heritage Partners/Contentmine. Getting funding in today’s rough economic climate is a clear sign of trust and makes me think where this company might stay in two years... . Among others, new Digital Railroad members are Eyevine and CalSportMedia.
Regarding companies selling software and related services to the Stock Photo Industry, there are presently only five companies with venture capital in the background (maybe shortly six, but more about this later, after the CEPIC photo trade show).
Update: If you read the last but one paragraph here at PDN, don´t forget that the parent company of PDN, VNU USA, is also the parent company behind IPNStock.
Four years after the Internet bubble burst, the venture-capital industry is stirring back to life. Investments by venture firms rose 22 percent in the second quarter of this year, to $5.8 billion.
For all of 2004, analysts project an 11 percent increase in investments, to $20 billion, from $18 billion in 2003.
That is a far cry from the $108 billion in the heady days of 1999, and nobody in the venture-capital business is predicting a return to that flood of cash.
The competition among venture capitalists to get their foot in the door of promising companies has also heated up. The time that elapses for a deal to close has been cut by more than half, from six to eight months two years ago to two or three months today, said Bill Ericson, a general partner with Mohr, Davidow Ventures, another Menlo Park firm.
Perhaps the most encouraging development for entrepreneurs is the increase in venture-capital investments in early-stage companies, to 231 in the second quarter of 2004, the highest number in two years.
At the same time, it is unlikely that start-ups will see a return to easy-money days anytime soon, in part because many firms are not raising the kind of funds they did during the bubble.
The real test, then, is whether company management has already proved its mettle with appropriate industry and small-company experience. "Even if they were unsuccessful, at least we know they tried and learned from what they did before," Mr. Brown said. Recently, he said, the firm added a psychological test to the last step of the decision-making process "to sort out the wheat from the chaff."
Rumors has it that recently a new and young company in the Stock Photo Industry received a first round of $12.7 million USD (today, this is a incredible high amount). When we asked some people over there, their CEO said what seemed to be exactly what David Sifry replied when asked by Om Malik whether or not Technorati got funded: "I'm sorry, it is our policy not to comment on questions on funding" (Link for Om Malik). More to report when they go online.
Scott Davidson, co-founder of Pure Images, said: “We are trying to bridge what we see as being a gap in supplying photography between small specialist libraries and extremely large websites like Getty and Corbis.”
Although there are British libraries, such as Alamy, that already offer this kind of service, Pure Images is the first in Scotland.
Scott Davidson and his brother Darryl have been building up their stock data base since last November, when they received a loan and a year’s free office space in Denny, near Falkirk, as a runner-up prize for an enterprise competition held by Falkirk Enterprise Action Trust.
Although Scott Davidson says the company still needs a much larger database of images, they now have enough to start targeting customers. The company is gearing up for a marketing blitz on the creative industries to officially launch the site next month, and will be offering generous discounts for the first four weeks.
Pure Images hopes to grow quickly by offering 70% of the licence price to photographers – which Scott Davidson said is higher than competitors’ rates. “There’s quite a variation with competitors. Our rate is on the generous side.
“Percentages paid to photographers by different libraries go down to 40%. Most photographers seem to think 70% is pretty attractive,” said Davidson, adding that photo graphers also get access to how their images are performing.
[...] As well as the enterprise loan, the company is being funded by the Davidsons’ existing web-design company, Oldhand Media [Link], which they hope to wind down if Pure Images takes off.
Looking back in the history of some stock photo agencies, we had the 90% cut, the 80% cut ... all gone and blown away. Now 70%. And the question remains: Will it work? There had been various posts in the Editorialphoto and Stockphoto Yahoo email groups in the last weeks, so for further informations try the search buttons there.
[Update August 10] Another company in this field who recently received funding is World Picture News ("World Picture News Gets Funding, Ramps Up Operations"): "Focused primarily on photojournalism news and features...the agency will make its first official presence at the Visa pour l'Image photo- journalism festival the following week."
One of the few examples that VC is back in business ("Having acquired several million dollars in investment capital in June", PDN), however not at seed stage ("the agency made sales "in the neighborhood" of $1.1 in 2003", PDN).
The Financial Times/Peter Smith today has a somehow surpringing article: "Getty and Corbis to battle over Zefa library".
The article reports that 3i, still the biggest (and for some still the best) VC company in Europe, might have plans to sell the german-based photo agency Zefa:
Zefa, owned by 3i, the private equity group, and its management, led by Erwin Fey, this month selected LongAcre, the corporate finance boutique, to undertake a strategic review.
3i acquired Zefa in 1998 for about €6m. Since then, its group's sales have quadrupled to about €35m. Based on a multiple of two-and-a-half times sales, Zefa is worth close to €90m ($111m).
All options are being considered, including an outright sale, a recapitalisation, and a partnership with either a trade or financial party.
Mena Trott has stepped down as CEO of SixApart, makers of Movable Type and TypePad, in favour of Barak Berkowitz, one of their Series A investors. Mena's written a heartfelt appreciation of Barak that is an instant classic -- a unique example of a company founder's sincere desire to see her efforts bear fruit, even if she's not's in charge any longer (though she's staying on as President).
Last but not least, Barak Berkowitz who was once my boss at Infoseek, then later worked for me at Neoteny, is now taking over the role of CEO of Six Apart...Welcome aboard everyone. I think we're turning a new page in the development of Six Apart...I'm a proud VC today.
A SixApart insider has contacted The Blog Herald alleging that Mena Trott was dumped as CEO of SixApart and did not stepped down as per the spin on her blog. The same source alleges that the move came after several weeks of worsening relations between Mena and investors, including fighting over the phone with Mena ending up in tears on more than one occasion over the poor performance of the company to date. Her working relationships within SixApart's San Mateo, CA, office are alleged to be "very poor" and the source speculates that given time the investors will look at buying out the Trotts.
The company, which when first formed many thought would go on to bigger and better things (including by The Blog Herald) has lurched from crisis to crisis as its continues to burn money with what our insider has described as a "totally overboard" number of staff recruitments, and through its disastrous licensing fiasco which cost it untold amounts of good will from its once strongest asset, its supporters in the Blogosphere who did so much to give the company such strong positive publicity at little to no cost.
The BlogHerald writes also: "Whilst the source also names the people allegedy involved in these fights, and the organisations they represent, we have chosen not to publish them at this stage for legal reasons."
"The New York Times describes how Tim Draper, a founder of Draper Fisher Juvetson venture capital firm, is trying out a new approach to finding the next entrepreneurial superstars . In his Web log (which NYTimes mysteriously never links to, but it's on AlwaysOn-Network), Draper asks the readers to leave the comments with their billion-dollar ideas. The winners of this pitch were selected recently, and just reading the comments with innovative ideas is quite interesting."
(btw: it´s Jurvetson, but how should you know?)
The attitude is the same as 1999: "The general attitude on Sand Hill [Road] is, 'If a company isn't 20 miles from my house, and if an entrepreneur doesn't come with a reference, we're not interested,' " Mr. Draper said." (NYT)
[Update June 9, 2004: Forget it. There is no way to re-open over 300 posts and reassigning new categories to the old posts. So these new categories only work with future posts or some very important old posts which had been adjusted. Try the Google Search instead. Sorry]