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Revolutionizing the Photography Industry: GotPhoto's Acquisition, Digital Transformations, and Future Plans

September 21, 2023 Benedikt Greifenhofer Season 4 Episode 132
The Dead Pixels Society podcast
Revolutionizing the Photography Industry: GotPhoto's Acquisition, Digital Transformations, and Future Plans
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Ready for more insights on the cutting-edge of the volume-photography industry? Join Gary Pageau of the Dead Pixels Society for a candid discussion with Benedikt Greifenhofer, CEO of GotPhoto, where he shares the fresh news of GotPhoto's latest business move: the acquisition of Next Gen Photo Solutions.  The acquisition of Next Gen allows for seamless integration of their services through GotPhoto, plus the company plans to invest in the current Next Gen system to help create an elevated service, providing the photographer with better offerings

Greifenhofer also discusses the strategic advantage of embracing AI and digitization in the photography industry. In the second segment, he discusses how this digital transformation has lowered barriers to entry and increased profitability for photographers. He also discusses the significant impact of COVID-19, examining how companies have adapted to a more digital-focused environment to meet evolving customer expectations. 

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Hosted and produced by Gary Pageau
Edited by Olivia Pageau
Announcer: Erin Manning

Erin Manning:

Welcome to the Dead Pixel Society podcast, the photo imaging industry's leading news source. Here's your host, Gary Pageau. The Dead Pixel Society podcast is brought to you by Mediaclip, Advertek Printing, and IP Labs.

Gary Pageau:

Hello again and welcome to the Dead Pixel Society podcast. I'm your host, Gary Peugeot, and today we're joined by a repeat guest, but who's got some great news. It's Benedikt Greifenhofer, the CEO of Got Photo. Hi Benedikt, how are you today?

Benedikt Greifenhofer:

Hi, Gary, I'm wonderful. Thank you and thanks for pronouncing the name right. That was awesome. That's great.

Gary Pageau:

I've had a couple tries at it, so this is, I think, your second or third time being a guest, so hopefully by now I've solved that riddle. So for the people who aren't aware, I can't imagine who it is at this point. But you can just briefly talk about Got Photo as a company.

Benedikt Greifenhofer:

Sure. So Got Photo is a SaaS tool for photographers. We see ourselves as basically the business suite for a photographer, where you can manage your workflow, your sales, your marketing, everything from one place. And we mainly did that in the past in volume photography, so schools and sports, but also moving into other photography types currently. So for Business Suite, that's basically what you're looking at.

Gary Pageau:

As a SaaS, you've got a subscription model correct. There's no software to install per se, it's just a monthly subscription type thing. What size businesses do you normally cater to?

Benedikt Greifenhofer:

Got Photo has been really successful. Looking at what we call the SMD markets more medium sized photographers. So mainly our customers are doing everything themselves or have a handful of employees on board. And it's going up to a size to a million or more in sales. But that has been our sweet spot and we scaled that quite well in Europe and also in the US and Canada and helped a lot of business owners do what they like to do, which is photography. Nobody becomes a photographer to deal with all the business stuff, right.

Gary Pageau:

That's how it is Exactly One of my good friends in the industry says nothing kills your love of photography faster than starting a photography business. So since we've last talked there's been an ownership change GotPhoto Photo and EQT Growth. Can you talk a little bit about that and what that has meant for the company going forward?

Benedikt Greifenhofer:

Yeah, so we got a new partner on board who is the equity growth and private equity fund from Europe, namely from Sweden, which is an incredible partner to the business, is opening a lot of doors, obviously financially, but also with advice. They brought on a really great board. To name two people Eric Huggers, our chairman, who worked at different companies before, and also, for example, jeff Weiser, the former CMO of Shopify. They advise us as well, so it's just a great combination. It's a very, very successful and professional organization that moved in here, helped us with advice business advice on growing the company but also gave a financial injection.

Gary Pageau:

And that came about 10 or 11 years into your company's history, so you had already been very well established and had a great track record going into that. Are you seeing that happening overall in the volume of photography market where there's some investments happening in the space?

Benedikt Greifenhofer:

Yeah, I mean the point of GotPhoto acquisition or ownership change is mainly also coming from being such a successful company. You look at how we build the business. We did it with minimal funding. We boot strapped the business very long. We bootstrap the whole internationalization to the United States, which sometimes people don't believe us, but everything is basically out of all cash flows and that has been very attractive to a lot of potential investment members and that that Continues to be the case.

Benedikt Greifenhofer:

And I think if we look at the volume photography market or the photography market in general, it's one of the markets that's not hugely digitized at this point in time. I think if we find a very sustainable company like us or they also all there's in our ecosystem, that can be quite quite a good investment target, I think. And also the pieces that we Created, together with the equity is around the markets we're going growing very quickly based on the digitization, but also based on the market dynamics, and with that creates a very, very good opportunity for for different investors, I believe and speaking of investment, you've just recently announced that you've made one or acquired a company.

Gary Pageau:

Can you talk about that and the direction that's going to take?

Benedikt Greifenhofer:

Yeah, I remember in our press release of like bringing you could see on board, we hinted a little that that opened stores for for inorganic growth, and that is exactly something that we're looking at right now when it makes sense. We're not like people. As I said, we bootstrap the business. We're not people that will cover how to just buy ton of companies. We do where it makes sense for customers. So where we, where we see a huge advantage of serving photographers better, cutting more time for them Out of the workflow or increasing their sales, that's basically what we're looking at. They're just Announces around Editing and graphics creation, especially in the sports photography market. So if you look at sports photography, the biggest issue that you have is the different sports graphics that you have to create for your customers. Yeah, everyone is expecting a memory made. Everyone is expecting their kids to look like heroes, and they also. I mean they're right, that's how it should be, that's what sports is right, exactly, great heroes.

Benedikt Greifenhofer:

And we we just announced that we acquired Next Gen Photo Solutions, which is a company that actually outsources the creation of graphics completely for photographers and in combination with an e-commerce tool like what photo, it can be very powerful because we can just cut the time on the workflow A lot, while we create great imagery with high quality. That increases also the sales for the photographer. This combination was huge for us and that is that's why we took all of the business together with also thefounder, Wes Kroninger, we will continue to work at photo and help us shape the product Next-gen, but also the product photo into the future.

Benedikt Greifenhofer:

To have a sales, sales and marketing officer operating for sports photographers.

Gary Pageau:

Yeah, because some of the things that they do here is is kind of interesting, where they they create the composite like the team photo and things like that that that are really, you know, value-added products. And also, you know, we're kind of difficult for photographers and so to capture a lot of, because of, you know, just getting a team shot can be a challenge, but that's more on the editing side. That's not really something that got photo is known for, do you? Is this like a change or an enhancement to your direction?

Benedikt Greifenhofer:

It's certainly a new service that we're offering. Yes, we have been staying. We had editors always plugged into our platform as like a service, but it was always a third party service. So that is with this acquisition it's the first time that we move into the editing services side. We also see next gen as like the beginning of investing more into that and automating a lot.

Benedikt Greifenhofer:

I mean, ai is a topic that is all around us, so we see great opportunities looking at next gen and investing further, also with AI technology, into that business and even faster and more reliable solutions.

Gary Pageau:

And it does continue sort of your digital first approach. Right, you're taking a, you know what the potential is of digital and then extending it.

Benedikt Greifenhofer:

Exactly. I mean, what it also does is like and this is kind of like vision that we have, so we believe in the future the photographers should not create just one memory mate and presented to the customer, but the customers would decide out of three or four designs what they want. Basically, you can stick that together and this is where we're heading with this acquisition, because next gen has been known for huge quality or great quality in their imagery and in their designs and we see that as super valuable to photographers.

Erin Manning:

And if you can make this a scalable solution.

Benedikt Greifenhofer:

That's almost instant. Then we created a really, really great product for the photography industry to grow out and grow and increase sales, but people will still be able to plug in their own editors, right. Yeah, exactly, they can do that, yeah.

Gary Pageau:

Yeah, so this is not an exclusive thing where you're in a big change in direction.

Benedikt Greifenhofer:

For you, it's just an enhancement of something you're already doing Exactly we will never force people to go to go on path on the editing side not at all. We just see this as like a stream where we can streamline a lot of things and create a really, really good experience for the photographer. If they want to use it or not on the good photo platform itself, up to them. They can also use the Nexon service going forward and use it with a different platform. We're not limiting that.

Gary Pageau:

Okay, so next gen will still be standalone entity as well as integrated within GotPhoto. Correct, yeah, okay, because that's what people kind of when they hear acquisition. They kind of think, okay, now I can't use them anymore, but you still can't.

Benedikt Greifenhofer:

No, you can. You can still run your normal Nexon jobs too. There will be obviously enhancements between GotPhoto and Next-Gen that it runs smoother and going forward. There might be also workflow enhancements on that front, but the service as it stands there today can be just used and continue to use, also going forward.

Gary Pageau:

So is this going to be a greater emphasis for the company on the sports and events side of it, in addition to the traditional school portrait market?

Benedikt Greifenhofer:

So what we see is we see a movement away from this traditional sports shoots we over to the virtual sports that Next-Gen is also promoting a lot, yeah, and that helps a lot of with a lot of things. You can scale it a lot more. It's a lot more sophisticated in terms of having great-quality imagery throughout. It's easier to operate. There's a lot of great things coming with it. So it will help school photographers to also go into the sports market, we believe, because you can just outsource a lot of things. We actually proof this also with some of our customers who were complete school photographers. But then with this integration that we actually built before already, so it was always an integration between Nexon and GotPoto where you can pass images around, and they have actually entered the sports photography market with that. So it just helps photographers to also move into sports, which is naturally a more SMB type market, because the larger photographers, like LifeTouch especially, have captions of what I'm going to show you.

Gary Pageau:

So the volume market has been the news a lot lately with, I mean just in general, the entire market right With a lot of people getting into the market. There have been obviously you mentioned a major player who you know, it's no secret they've been struggling in the market. You know that's not an opinion, that's a fact and so it's creating a lot of opportunity for people and it's also created a lot of interest for them. A lot of you know investors and private equity and those kind of companies. Why do you think volume photography, just as a category, is attractive for those type of entities right now? What makes volume photography a great idea, a great investment?

Benedikt Greifenhofer:

That's a good question. I can't speak for. Right, yeah, I know you're not speaking for everyone, but obviously I think if you look at the volume photography market, it has been proven to be quite crisis resistant. If you just look at COVID itself, right, yes, in COVID every business struggled, but the bounce back in our industry has been really, really strong and it also developed quite well afterwards.

Benedikt Greifenhofer:

I also don't see that AI, for example, is a threat to the images that we create, because it's really images that you create of a human being, that parents know how the kids' face looks like and their expression, and an AI cannot generate that. That has to be done by photographers, and these memories are just so valuable. I mean, we create products here that people really want, so this is something that is easily sellable and it will always be a business and I think with that it's just very advice proven. That is one part.

Benedikt Greifenhofer:

Digitization is the other one, and if we look into what movement I mean part of the struggles of larger players and also the digitization in the market that is going on is leading towards the market changing into a more digital environment, but also an easier environment for different photographers to move into, where, like five, six years ago, if you would have asked a wedding photographer to photograph a school, they would have to answer a lot of operations questions, which they might not want it to do. But today it's more like hey, here's a software tool that helps you. Doing this takes all of the headache topics of workflow and organizing stuff way and with that it's way easier to take on this work as well, and the emphasis will lie on the imagery and on capturing this memory. And I think this is the great business, reliable business to be in, and with that we see a lot of profitability, a lot of resistance and resilience in this market and I think that makes it quite compelling. But that's again Benedict's take on this right.

Gary Pageau:

Exactly. No, that's what we're looking for. Is your take? So I mean, I remember when I went to SPAC earlier this year, they talked about how there were so many new people coming to the convention to look at platforms and ways to get in, because I think the barrier to entry has been lowered to some extent, but I think there's a lot of people coming in that have their first streets and what we saw as well on the Gifoto platform and we just looked into the past two years data that we have there, especially in the United States, the people are growing at a fast pace as well.

Benedikt Greifenhofer:

We have success stories from photographers who started with our platform a couple of years ago doing a lot of new things, like the new technology with our platform out a couple of years ago, doing 20, 30,000 in sales and just continue to grow up to a million and more within two, three years. That is incredible growth for a business owner and I think that will be stories that we see more often in the future as well, because technology enables them to do that. Lower entry barriers, as you say, but also easier growth because the platform can grow with them instantly. Right, and you don't have to think about almost like hiring people, because the software is just taking so much away that it could easily scale this into a decent sized business without taking any employees on.

Gary Pageau:

And the other thing that I think is interesting, as you mentioned COVID earlier. I think COVID was a wake up call to many photographers and it gave them the chance to reevaluate their entire process, because they couldn't go into schools and when they could they had to do a touch list. So a lot of people went digital because they couldn't do paper forms anymore, and now all of some people are seeing the advantages of it and I imagine the accelerated adoption rate of people going from paper to digital has got to be I don't know what the percentage is, but it's got to be pretty fast.

Benedikt Greifenhofer:

I agree to that and I think it did one more thing it actually helped the companies that have been able to shape things very quickly into a new fashion been very resilient, and it hurt a lot of companies that have been stuck in the past and actually try or relied on this paper heavy workflows also in the future. So it's kind of a natural shift of the market towards the companies that have been able to change things around where quickly, in the depth, to the new.

Gary Pageau:

No, I mean got photos, been around since 2012.

Gary Pageau:

I mean, you've been preaching this since forever.

Gary Pageau:

And then you know, you know this, this, the incursion into the market, if you will kind of force the hand for a lot of people where I think you know, for a lot of years the volume photography market was very stable and static and kind of old school, right, you know it's, it's very.

Gary Pageau:

You know that we're going to give it. This is the product we're going to give because this is the product we do. And now they've become much more customer responsive, not only to the school but now to the parents. They have to actually provide products for the parents that the parents want. And now the parents are getting used to seeing things like oh look, there's proofs on my phone now. I didn't have that before and it's within minutes of the shoot and I can do more with it and I can do these kind of things. So I think that is going to drive revenue, is not only pleasing the school, who is the first customer, but now the ultimate customer, who was kind of removed from the school photographer to some extent, is now going to be a benefit and that's going to drive a lot of the business.

Benedikt Greifenhofer:

I agree.

Erin Manning:

And.

Benedikt Greifenhofer:

I think there's one addition that we have to make with all of the technology coming around and taking all the workflow headache away, automating a lot of stuff, the picture quality itself becomes more and more important, and if you ask if you really could have won a good process, you had a real business advantage over others especially the smaller players but all technology coming into play.

Benedikt Greifenhofer:

The imagery that you produce will be one of the key differentiators that you have as a photographer for business, and that's why we also believe something like a next gen acquisition will just help all photographers about to have a strategic advantage, because we just create better imagery and better memories for the parents, and that's that's exactly what photographers should focus on.

Gary Pageau:

Yeah, because if you think of what the camera capabilities are now compared to some of the other, are you seeing any more interest in things like video type deliverables, or is that coming down the line?

Benedikt Greifenhofer:

So we particularly at good photo. We do not get the request a lot in volume photography. We have seen that mother on the on the portrait photography side of all this. This is something that we will eventually look at. Yeah, yeah, pressing issue. I know there are several use cases of several photographers in the in the business starting to preach video.

Benedikt Greifenhofer:

I think this is a format that the industry still has to learn, because it's quite tough to generate a video in this short period of time that you have with a kid right. Yet still, maybe for preschool, for example. Preschool photography could be something that is coming sooner than later, but that is currently not on the workman and immediate.

Gary Pageau:

And it's like you said. I always hear people talking video and I've done some podcasts with people have like the sort of these automatic video creation platforms. But you know the reality is and again, I'm not knocking that, but the reality is like you said, you've got 28 to 35 seconds to get a picture of a picture, so you can't have, you know, full suite of part of pictures to shoot, not on how much. You know whether you can do some AI to generate different poses and some do different things. I know people are playing with that sort of thing, but in the end it's got to be done efficiently and and and and. It's a model that makes sense and I just don't think it's there yet.

Benedikt Greifenhofer:

I think we will see a lot of innovation in that space coming in the next years, especially with AI together, and I think that there will be ways to create these memories with moving images, however that will look like, but currently, on the good photo side, we're not investing into this at this point.

Gary Pageau:

So we're in the middle of the shooting season right now when we're talking. So what are you seeing and hearing right now going on in the market? What are your customers saying? How's the season going?

Benedikt Greifenhofer:

So whenever you ask someone in the season how it's going, they say busy. There's always this slight tension, and I think this is what I see this about for everyone. So I think we will look at it after Thanksgiving. That's exactly when we know what's going on in the market, because leading up to it it's mainly like gearing up, having all the new workflows that we created for the photographers down, definitely some enhancements to the platform. This is what we mainly talk to them about. We have new sales capabilities for sports products that increase sales. We also launched new functionality on the marketing side. So there's different things that we train photographers on launching new payment service that creates a little bit more reliability on payment but also gives more payment options. So that's what we've been most focused on and, to be honest, after the season it's a better time to lean back and talk to them and ask them what's been good, what's been bad. Tell me everything the good, the bad and the ugly and then we figured out from here. But that's just how it is.

Gary Pageau:

That's the nature of the business. For the most part they're probably too busy to talk to you unless they've got, imagine your support. People are quite engaged right now, but just a lot of chatter back and forth probably not happening.

Benedikt Greifenhofer:

Yeah, you would be surprised Some people have time to talk to me, but it's mostly when something's not right. That's exactly when I get on the phone, which is totally the right thing to do, and super happy to help wherever it's necessary. But yeah, we try to leave them at their business doing what they do best and when they need help we support them. That's how we approach the season.

Gary Pageau:

It sounds like things are moving along quite rapidly there at Got Photo. Do you have an idea of some of the discussion points you're going to be having at SPAC, for example in January? Anything to look forward to there?

Benedikt Greifenhofer:

I think what we're currently working on, and what probably will be a discussion point at SPAC, is a new shopping cart that we're working on. There might be something that we can present, obviously with this new addition to our platform with Nextion. That's something that we want the world to look into. What are the new capabilities that we can show then? This is mainly what we have cooking right now. There might be other updates down the line. As you say, it's rapidly changing. We also get new leadership people on board.

Benedikt Greifenhofer:

Currently we spend a lot more time on strategic discussions rather than we had before. I mean, if we just look at the size of the business one and a half years ago, I think before, there was an 70-80 people company. Today we are 180. So this size and this growth we have to digest a little as well. I think in six months from now you will see this business just perform one after the other, one topic after the other, and bring things to the market a little quicker Then. We have done that in the past six to eight months because we were quite busy building all the structures that we need in order to grow further into the future.

Gary Pageau:

Well. Thanks, benida, for your time. I appreciate it. Congratulations on the Nextion opportunity, hope that we'll look forward to hearing more from you in the future, and best wishes for getting through the busy season.

Benedikt Greifenhofer:

Thanks, Gary, have a good time, talk soon.

Erin Manning:

Thank you for listening to the Dead Pixel Society podcast. Read more great stories and sign up for the newsletter at wwwthedpixelssocietycom.

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