Depositphotos

The company's office is based in the United States. Part of the project team for 2021 works in Russia, Poland and Italy.

Business model

In November 2010, the front page of The New York Times featured a photo of American soldiers in Afghanistan taken on an iPhone. The story repeated itself 2.5 years later: baseball player Alex Rodriguez, photographed on a smartphone, decorated the editorial. Each such case incredibly pleases 36-year-old Kyiv businessman Dmitry Sergeyev, founder of Depositphotos photo bank. This confirms his hypothesis - very soon all the world's leading media will be filled with photos taken by unprofessional photographers on smartphones and tablets.

Microstock receives images from tens of thousands of photographers and agencies. And sells them to design studios, publishing houses, various media, advertisers and others. Depositphotos earns fees from each file sold. Usually, a microstock takes 50-75% of the transaction amount. If compared with such Internet intermediaries as eBay, Booking.com and Airbnb, the gap is striking: the commission of other services does not exceed 10-15%.

True, the amount of transactions in microstocks is usually small: the average price of one photo is $3-5. Depositphotos 2012 revenue is a modest $6 million. But if the online photo trading market is growing by 50% per year, then Sergeyev's company is more than 100%. In 2013, Depositphotos expects to earn over $15 million.

Performance indicators

The company's library for 2021 contains 218 million images, photographs, video clips and musical works.

History

2022

Blocking photo hosting in Russia

Roskomnadzor has limited access to a large international photo bank Depositphotos. This became known on July 11, 2022.

According to the service for checking the blocking of pages and sites, access was closed to the page of the photo bank dedicated to the Russian military special operation in Ukraine. This was done at the request of the Prosecutor General's Office of July 1, 2022. The page was entered into the register of prohibited information.

Depositphotos photo hosting blocked in Russia

According to Interfax, the page is included in the register of information prohibited in the Russian Federation in accordance with Article 15.3 of the Law "On Information," which regulates the restriction of access to information containing calls for riots and participation in unauthorized actions, extremism, as well as unreliable socially significant information disseminated under the guise of reliable messages (the so-called "fakes").

Blocking one page leads to the unavailability of the entire resource in the country, since the site uses the https network protocol.

Depositphotos Photo Bank in a special section publishes photos of Russia's military operations in Ukraine. The site hat contains a special button for donations to residents of Ukraine.

At the same time, Depositphotos stopped working in Russia and Belarus at the beginning of March 2022. The service planned to restore work in Russia as soon as the international sanctions imposed on it were lifted.

It is difficult to say how the administration of photo hosting plans to "reimburse obligations" to professional publications, journalists, photographers and artists who have fully paid for access to its services. All of them at one moment turned out to be faced with the fact of the impossibility of further work and are discriminated against only because of the fact of being in a certain country.^[1]

Curtailing business in Russia and Belarus

During the special operation of Russia in Ukraine in March 2022, after the introduction of US sanctions, Depositphotos closed sales and access to the service to customers and partners from the Russian Federation and Belarus.

"We stop accepting payments and providing prepaid services to customers from these countries. Depositphotos initiates a refund for prepaid subscriptions immediately after the end of international sanctions, "the company

2021

VistaPrint bought Depositphotos for $85 million

At the end of October 2021, the US-Irish corporation VistaPrint announced the acquisition of the Ukrainian company Depositphotos Group, which includes the photo hosting of the same name and the online editor Crello. The transaction value was $85 million.

As a result of the deal, Crello will change the name to VistaCreate and become part of the new Vista brand along with VistaPrint, 99designs from Vista and Vista x Wix. Depositphotos will have access to Vista's client base, which has more than 20 million users by the end of October 2021. Authors will be able to share their work and portfolio with the international community and reach a new level, added Depositphotos.

VistaPrint bought Depositphotos for $85 million

Crello has millions of registered users in more than 150 countries who create more than a million projects every month, and Depositphotos is a platform for the creative community with more than 100 thousand content authors.

Former Depositphotos CEO Vadim Nekhay has joined the Vista team and will continue to lead VistaCreate and Depositphotos projects, reporting to Vista Executive Vice President and International Division President Florian Baumgartner.

For more than 20 years, we have been helping small companies look and feel compelling, and as their needs have changed, we have evolved with them. We are excited to announce Vista's new parent brand, which reflects our ongoing transformation into an expert design and marketing partner for small businesses worldwide. Launching VistaCreate is an important part of this journey, giving small businesses access to a world-class creative design solution for social media, "said Vista founder and CEO and its parent company, Cimpress Robert Keane[2]

TMT Investments sold its stake in Depositphotos for $14.3 million

In October 2021, it became known that the TMT Investments fund sold its stake in the international photo bank Depositphotos. The transaction amount amounted to $14.3 million. Of this amount, $12.9 million has been received at the moment, the remaining $1.4 million will be paid during the year. The fund's investments in this project brought a fivefold return. News of this was published on the website of the London Stock Exchange (LSE).

TMT Investments owned a 16.7% stake in Depositphotos. In September 2021, the fund announced the conclusion of an agreement on the sale of this asset.

At the end of the first half of 2021, TMT Investments estimated the value of its stake in Depositphotos at $10.83 million. The amount of the transaction exceeds this amount by $3.5 million (32.3%). It is not known to whom the package was sold.

In total, TMT Investments invested $4 million in Depositphotos. Taking into account two transactions, the total revenue of the fund from the sale of a share in this asset amounted to $20.15 million - five times the size of the investment.

2016: TMT sold part of stake in Depositphotos and retained 17%

The TMT Investments fund created by the Russians announced the partial sale of its stake in Depositphotos photo bank. The transaction amount amounted to $5.85 million. It is only known about the buyer that this is a European investor, the size of the sold stake is not disclosed. After a partial sale of the stake, TMT had 17% of Depositphotos shares left^[3].

2015: $5 million investment from a group of investors

At the end of 2015, Deposiphotos attracted a new round of investments from a group of investors led by the European Bank for Reconstruction and Development (EBRD). The total investment amounted to $5 million, including TMT Investments additionally invested $1 million in the company. By the end of 2015, the fund owned a 24% stake in Depositphotos.

2013: Plan to Conquer the World: Developed by Clashot

Depositphotos rivals world leaders Shutterstock and Fotolia in terms of content and user visits as of September 2013. In 2012, the company earned $6 million, and according to the results of 2013, plans to increase revenue to at least $15 million. Given the market multipliers for such companies, the value of Depositphotos is close to $100 million. If the bet on unprofessional content justifies itself, then Sergeyev's brainchild can catch up with market leaders, and this is a different order of numbers. The capitalization of the largest photo bank Shutterstock on the New York Stock Exchange at the end of the summer of 2013 was about $1.8 billion.

According to the forecast of the research company BCC Research, in 2013 the volume of the global online trading market for photos and videos will reach $2 billion. The revenue of the largest microstock library Shutterstock in 2012 amounted to about $170 million. iStockphoto and Fotolia also earn over $100 million. Sergeyev plans to come close to the top three in three years. It expects to more than double its revenue annually. How?

By the end of 2013, Sergeyev is going to make the biggest revolution in the microstock business since the creator of iStockphoto Livingston. Until now, only professional photographers and designers have sold their work on such services. Sergeyev is convinced that the development of optics in smartphones and tablets allows each user to become a photographer who can make money on his pictures. Over the past six months, ­ new business unit Depositphotos has been working on the Clashot application, which allows you to edit and add photos to the Depositphotos library. The beta version of Clashot is already in the App Store. In the fall of 2013, the Android version will also appear. At the end of the year, Sergeyev will begin an active marketing campaign.

The task of Clashot is to bring the functionality of a photo bank to any smartphone. "People can still post photos on Facebook and Instagram," says Sergeyev. "But if they believe that the picture turned out very well and can be bought - why not?" Of particular value are user reportage photos: people often witness significant events, and the smartphone is always at hand.

To move to the major business league Depositphotos will require "smart money" from investors with the expertise Sergeyeva needs. In early 2014, he plans to attract a second round of investments from eminent American venture capital funds. Sergeyev is ready to sell up to 20% of the company. TMT has not yet decided whether they will participate in the second round.

"If the current growth rate is maintained, the company can be valued at 6-8 annual revolutions (the average monthly income for the last three months multiplied by 12 is taken as the turnover. - Forbes), "Kaplun predicts. Based on the formula proposed by Kaplun, Depositphotos will cost from $85 million to $150 million by the second round of investments. There have not been such expensive startups in Ukraine yet.

Large Western funds also drew attention to Depositphotos. According to Accel Partners Vice President Michael Treskov, the fund actively monitors the Ukrainian startup- ­ community, especially companies that can achieve success in the global market. "Depositphotos is a vivid example of such a company serving a global user base," Treskov believes.

There are other opinions. "At first glance, the estimate is overestimated, but more input is needed," says Dmitry Chikhachev, upravlyayu­shchy partner at Runa Capital. "I think their estimate is closer to 3-4 annual turnover," agrees Denis Dovgopoly, managing director of the consulting company BayView Innovations.

Sergeyev has no doubts about the successful attraction of investments and is already willingly discussing a possible IPO. In October 2012, Shutterstock held an IPO, during which the company was valued at $558 million. For 10 months, Shutterstock quotes have tripled, and as of September 2013, its market capitalization is about $1.8 billion. According to Kaplun, the likelihood of Depositphotos entering the IPO in the future of three to five years is very high. "If before that the strategic investor does not make an offer to Sergeyev, which he cannot refuse," he notes.

In 2012, Deposit­photos opened a headquarters ­ apartment in the United States, which is engaged in marketing and sales. But 130 of the company's 150 employees still work in Kyiv. Sergeyev is confident that in 2014 the number of employees will exceed three hundred. But the lion's share will remain in Kyiv. "There are no equal to Ukrainians in terms of the ratio of price and quality of work," Sergeyev is convinced.

2011: Investment from TMT Investments

The new Sergeyeva project was almost immediately noticed by venture capital funds. After the first year of operation, the service became profitable, but the founders needed funds to maintain dynamic growth. Sergeyev willingly made contact with representatives of venture investors. The most persistent was the TMT Investments fund, created by immigrants from the Russian RBC - Herman Kaplun, Alexander Morgulchik, Artem Inyutin and others. They have been eyeing Sergeyev since 2008.

"This is a person who clearly understands what and why he is doing," says TMT co-owner Kaplun. In 2011, his fund bought 27% of Depositphotos for $3 million. For a young Ukrainian company, the $10 million valuation was an achievement. But now TMT is very pleased that they have not been greedy. "In two years, the company has grown almost 30 times - there are very few of them in Runet," Kaplun notes.

2009: Launch of the service by a native of Yaroslavl Dmitry Sergeyev

A native of Yaroslavl Dmitry Sergeyev became interested in the photographic stock market even before the sale of Depositfiles. A common acquaintance brought it together with designer Igor Kalyuzhny, who has been selling 3D models and graphics through Shutterstock and other services since 2007. Kalyuzhny knew the specifics of microstocks well, and Sergeyev had vast experience working with terabytes of information and the ability to create sites that withstand a million visits a day. In 2009, the service began to work. "We faced skepticism and even community aggression: everyone believed that the microstock market was divided and we were superfluous there," Kalyuzhny recalls.

Depositphotos found something to attract both sellers and buyers. Projects at the beginning of the 2000s were created by immigrants from the environment of photographers and designers. Sergeyev brought his experience with Depositfiles to the microstock business. The site has been made more convenient and technological than competitors, many functions over time have been borrowed by members of the Big Five. For example, the Ukrainian team was the first to introduce online customer support in real time. But the main incentive was still money. To attract photographers, Depositphotos paid 10 cents for each photo posted on the site. The action was valid until the service scored a million pieces of content - it took about a year^[4]

"In discussions on specialized sites, photographers said that after the termination of the action, the flow of content will decrease, but it has only grown," says Kalyuzhny. Today in the Depositphotos library - more than 16 million files. Every month it is replenished with at least half a million new photos and videos. None of the drains can boast of such a pace.

"In two years, the company has grown almost 30 times - there are very few of them in Runet"

Notes