The current market for tech IPOs hasn’t been this bad since the Great Recession.
There were no IPOs for tech companies in the first quarter of 2016 — the last time that happened was 2009. While SecureWorks, a cyber security division of Dell, is on track to be the first technology company to go public in 2016, public tech listings have been scarce over the past year.
A general decline in venture capital funding shook the tech sector in 2015 and IPOs grinded to a halt. Tech companies such as Square and Fitbit went public and traded below their offer price, and the startup ecosystem continued to favor large private funding rounds in lieu of going public.
Now, the tech sector is experiencing a venture capital shakeout, and as capital becomes harder to come by, the remainder of 2016 may bring a resurgence of tech IPOs.
In the realm of public tech companies,
We caught up with Oringer to discuss how, in the age of uncertain tech IPOs, he managed to turn a stock photo company into a public success.
Built In: While many tech companies have faltered after going public, what factors have contributed to Shutterstock’s success after its IPO?
Jon Oringer: There are a few factors that have contributed to our success post IPO. I believe each of these need to be managed simultaneously.
First and foremost, we are always thinking long-term. Oftentimes short term market fluctuations distract leaders from their long-term strategy, resulting in focus shifting to the wrong challenges.
After going public, we continued to focus on what was most important — our customers. It's easy to get distracted by the noise of going public and to succumb to the extra attention from media and investors. We are in constant communication with our customers every day and gather insights on an ongoing basis that then informs not only our customer service and sales team, but also our product and tech team.
We dedicated a lot of time and energy into hiring talented people who have the skills we needed to execute on our plans for global growth and product development.
Having investors now means we need to be even more proactive about external communication and consider our investors’ expectations. We constantly review our growth plans and company performance and clearly communicate these during quarterly earnings calls.
BI: How has the company changed since going public?
JO: Since our IPO in 2012, Shutterstock has grown and changed in many ways. Growth, for sure is one of the elements that have made us obviously different: in 2012, we had 200 employees and now have more than 700; the site was available in 10 languages and today we offer 20 languages; we had 20 million images in our collection and now offer more than 80 million. But we are not done, we are continuing to innovate and bring new products and services to our customers around the world.
We are making investments in building new technologies, we have an in-house computer vision team dedicated to delivering new ways to search and understand our collection. With the introduction of reverse image search and visually similar search we are breaking new ground as a technology company. This is a reflection of the long term thinking that is fundamental to how we run the company, we are here for the long haul and will adapt to be successful.
Another example of this is our entry into simple editing tools. Easy for anyone to use, to make editing images simple and accessible, adding filters, adding text all these tools are making our customer’s interaction with Shutterstock more rewarding and help save them time at work. 90% of customers edit an image after they download it, we can speed up that process for many of our customers with Shutterstock Editor, make their job faster and simpler.
BI: Looking ahead, what are Shutterstock’s goals and priorities over the next year? The next 5 years?
JO: Our customer landscape continues to evolve and we are evolving with it, often ahead of it. We are focused on developing our existing business, particularly the fast-growing areas like our enterprise offering, as well as more editorial content, from companies like AP and the new york agency BFA. Video and music are growing at a remarkable rate as our customers need more and more video for social platforms and websites and as new strongholds in TV production begin to emerge, like Netflix and Hulu. Also we see more and more online advertising moving its focus from still images to video which is driving demand for high quality footage and music at reasonable prices.
Looking further ahead, we are focused on scaling Shutterstock beyond our current offering, which is largely asset (images, video, music etc) centric. In 2014, we acquired WebDAM, which integrated us into the workflow of marketing and creative professionals and we see additional opportunities to build tools that help bring our customers' ideas to life. And with the launch of Shutterstock Editor, and computer vision technology we are focused on what else our customers need to do their jobs better. For example our newly released reverse image search allows users to search our collection with any image that inspires them and the technology will find the images on Shutterstock that best match it.
BI: Has having a NYC headquarters helped the company in its success?
JO: I can’t imagine establishing Shutterstock’s headquarters anywhere else. I am from New York and studied here, so it was important to me personally to have our headquarters here. There is no question that New York contributed to our growth for a number of reasons.
New York boasts some of the brightest and best talent in the world. At Shutterstock, we look for talent with a broad range of skills and experience and because of the great schools here and other great tech, creative and media companies, we are able to source that talent here. We often look to hire bi- and tri-lingual staff and that’s not a problem for us given the international nature of the city.
Also, because New York is one of the greatest cities in the world and the tech community here has grown from strength to strength it is much easier now to find, retain and develop talent.
From a customer standpoint, many of the industries and businesses we work with across media, advertising, finance, publishing and film have their headquarters in New York. It’s important for us to meet our customers where they are and we’ve been able to do that since day one.
Similarly, considering the global nature of our business, New York has positioned us well to communicate and collaborate with colleagues and customers around the world in other timezones.