Back in November last year image giant Corbis acquired Demotix, the crowd-sourced breaking news picture and video agency which had launched in 2008. We present for you a lighting fast ‘exit Q&A’ with founder and former CEO Turi Munthe, who has since left to pursue new projects.
Demotix sold to Bill Gates’ Corbis, the second biggest picture library in the world, in November 2012. On the way, since their launch in January 2009, they built a community of about 40,000 people in every corner of the globe, providing them with a platform to tell stories that nobody else could – or often would – cover. They broke over 1 million news images, reported 100,000+ news stories, published scoops from Iran to Oslo and sold their community’s work all over the world, shipping hundreds of thousands of dollars per year to a network of freelancers from Haiti to Zimbabwe. Not bad for a start-up in news industry which is haemorrhageing money daily.
I caught up with Turi Munthe the week after he finally stepped down as CEO to ask what advise he would give to other entrepreneurs.
MB: What did you get right?
TM: Our advisors: we (Jonathan Tepper and I) built a team of exceptional people who, despite our thick-skulledness, helped us avoid some of the biggest potholes. The ones we hit were ALL because we didn’t know how to listen to them.
In terms of office culture neither Jonathan nor I have ever had as much fun professionally as starting Demotix. Everyone we hired and kept had the same vision of, commitment to and passion for what we wanted to achieve, and everyone had options (including many of the early interns). We had problems, but we also had a ball and made some great friends in the process.
We were cheap because we never raised the squillions of our competitors in the US, so we had to be. Short, cheap leases; no marketing spend (as Founder, you are the marketing); no headhunters, no consultants, and as few hires as possible. Don’t try to outsource your risk: do it yourself. Oh, and conferences? Only go to the ones you’re speaking at…
We also set out to win prizes. Before you make sales, raise big bucks, and become insufferable, start by winning prizes. When there’s nothing else out there, they validate your story. Plus they dazzle investors and boost the team.
MB: What did you get wrong?
We weren’t geeks, and didn’t bring one in as co-founder. I still can’t quite believe some of the crap we wasted time and money on as a result. Here’s a rule to follow.
Hiring: I’m sentimental, and Jonathan is even worse. When everyone fits, the team fizzes. It takes just one person to skew the dynamic, and I let that happen too often.
Spending equity. When you start, equity is your only currency. You will regret how you spent it whatever happens. So try to spend it measurably (ie. options not shares).
MB: What have you learnt?
The defining feature of a company’s success is the market it’s entering: a rising tide raises all ships and all that… A free-speech news platform? Are you kidding?
Understand your market, even if you’re planning on inventing a new one. Do everything you can to speak to future clients, and then when you’re up and running, to talk to existing clients. If you don’t believe they’re your number one mentor, you’re in trouble.
Moats matter: the news photo business is really an oligopoly (AP, Getty, and Reuters). Oligopolies exist because there are high barriers to entry: your business is figuring out quite how much it’s going to take you to breach those.
Have fun: start-ups are risky as hell and, in almost all certainty, a terrible investment of your time. So really care about what you’re doing and really enjoy doing it: the experience, most likely, will be what’s of most value.