How Malaysian Husband and Wife Bootstrapped one of the World’s Top Stock Image Players.

Over the past 17 years, Inmagine Group has grown to become one of the world’s top stock image players and it has done so under the radar.

100 percent bootstrapped, the Hong Kong-registered but Malaysia-based company has a 450-strong workforce in more than 40 offices around the globe.

Boasting an annual revenue in the tens of millions of dollars, it has been profitable for years. Its website 123RF, which accounts for bulk of the revenue, is said to be the world’s fourth-largest stock image library with 72 million items, drawing 16-18 million visitors a month.

Getting there, however, was a rough journey.

Humble beginnings

Like many startups, Inmagine’s origins began in an apartment with a laptop and two co-founders – husband and wife Andy and Stephanie Sitt from Ipoh, Malaysia.

It was the year 2000 and Andy had just quit his job as financial controller of Digital Vision, a British company that sold stock images in CDs while showing customers printed catalogs (which would later get acquired by Getty Images for US$165 million).

Eager to upend the industry, Andy returned to his homeland and launched his ecommerce bid.

“I was convinced that I could change the way people purchased images and do it from Asia,” he recalls.

“Stephanie, my girlfriend then, was the only free labor I could get,” he says of his now wife, who had just finished her marketing degree at University of Hertfordshire at the time.

Using whatever little savings they had and their credit cards, the duo set up Inmagine, selling premium large-format photo prints – both their own and from existing photo firms – for US$500 apiece. Their market consisted mainly of ad agencies.

While selling online eliminated the cost of printed catalogs and CDs, producing their own content came at a hefty price. “We hired photographers and scouted for locations and models to build our own content. It was a full production – we did hair and clothing. We hired graphic designers to do photo editing,” Stephanie recounts. “Post-production expense was also high. We needed to hire people to work on the metadata of all the assets and a sales team to cater to demand.”

From a team of two, the company slowly grew to six people, then to 10.

Lack of funding

Inmagine’s sales didn’t blow up initially either. Largely driven by word-of-mouth referrals, whatever sales that came in were reinvested in production.

The early days were all about worrying if they’d have enough cash to keep going.

Struggling, they reached out to investors only to receive a bunch of no’s.

“Any business without cash is tough. The thought of not having enough cash for the rainy days restrict your desire and drive to push hard. We did attempt to get some funding but the VC industry was very different then,” says Andy.

“No one saw nor understood the opportunity. No one wanted to take that risk with us. It was also impossible to get loans from banks and government agencies,” elaborates Stephanie.

To pull through, the Sitts didn’t pay themselves any salary for the first few years until they had built their reputation to clients.

Ushering in the digital age

Luckily by 2005, the landscape started to change.

With digital cameras cropping up, anyone could capture shots and make money off of them online, expanding the supply of content exponentially. Demand for more affordable images also started to grow, along with the internet’s rise.

That was the time Inmagine set up 123RF, which offers stock images, videos, as well as audio clips, for just US$1 to US$3 apiece. Unlike the previous model, 123RF did away with production and tapped photographers anywhere to sell their works royalty-free. The company gave them a cut of the sales ranging from 30 to 60 percent depending on the performance of their portfolios.

The new pricing tier widened Inmagine’s customer base. “Other than corporations, people didn’t have the budget to go to ad agencies,” notes Stephanie. With 123RF, small and medium businesses as well as startups could now create their own advertising materials.

To grow without any funding, the company launched subscriptions to complement its pay-as-you-go model. “That allowed us to get the cash first and then service the plan later. We were rolling our business with cash from the customers who paid monthly or annually in advance,” says Andy.

At the same time, it began penetrating new markets, a move that posed another challenge. “Reaching a global market was definitely tough. We needed to localize, apply for registrations, open offices, hire local talent.”

Today, Europe accounts for 40 percent of Inmagine’s demand, followed by the US with 30 percent, and Asia-Pacific with the rest.

Transforming into an ecosystem

More than being a global business, Inmagine had larger ambitions. It wanted to become a robust ecosystem that spans different creative content and market segments.

It launched StockUnlimited, a site that takes after the Netflix model, charging a flat fee. Initially, StockUnlimited offered vectors and then expanded to photos and audio clips.

There’s another site,, which sells ready-to-use design files like website themes, infographics, business cards, and resume templates.

“The strategy is to merge things together seamlessly to allow cross-selling and upselling,” says Stephanie.

Just recently, that strategy got a boost with the company’s first acquisition – UK-based design marketplace TheHungryJPEG (THJ) – for an undisclosed sum.

Counting 300,000 active users, THJ will support Inmagine’s continued entry into new and adjacent markets. It will help Inmagine cross-sell, increase its value by adding fonts and graphics and other creative bundles to its product line, and deepen its understanding of what sells well among designers.

“It’s a win-win. THJ will leverage on our extensive global network and capability to serve clients who want to market their products and services to millions of users around the world,” says Andy.

The companies share a similar DNA as THJ is also 100 percent bootstrapped and community-centric.

In the meantime, 123RF has also been appointed as a global reseller of ad inventory in the Tencent ecosystem, which provides another avenue of growth.

What lies ahead

As for the next steps, Inmagine plans to launch an initial public offering to raise funds for its continued expansion. It’s the first time the company is raising external equity funding.

“We’ll continue to invest in new products which empower the creative and design ecosystem. For example, template editors, APIs, analytics capabilities,” says Andy.

Believing there’s still a lot of room for them to grow, the Sitts continue to learn from experience.

One advice Andy has for budding entrepreneurs: “You can go as far as luck and your knowledge take you, but talent is the core of the success of any company. Most of my team members have been with me for more than 10 years.”

For Stephanie, it’s the ability to adapt to change. “The last 15 years had been a fantastic ride. With changes in technology and the constant need to innovate, we have proven to the market that we can adapt quickly, especially given we are still 100 percent founder-owned and founder-operated.”

“Who knows what else it could bring? But one thing for sure is we’ll always be at the forefront of change.”

Article credited to: TechInAsia

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