Author Topic: New co-op owned RF/RM agency (Read 23029 times)

travelstock · « **Reply #25 on:** September 17, 2010, 11:25 »

Quote from: alias on September 16, 2010, 13:15

Agency co-ops are always very argumentative. Even with say 50 people. Thousands of people are not going to form a successful co-op agency. It won't happen. Any agency also needs vision, direction, style, leadership. Lots and lots of little agencies might work however. Perhaps under some sort of loose affiliation or guild like structure. Even a guild of independents. Perhaps with a common look and feel. Perhaps representing each others' product somehow. Perhaps with common pricing. Break it down into smaller chunks. Photoshelter is starting to seem quite interesting. Think about how you can provide buyers with a legal guarantee that you own the work. What about model releases etc ?

For anything to work it would need to be managed by full time staff and supervised by an elected board. A traditional style co-op probably wouldn't function in an effective way. The John Lewis Partnership Gostwyck provided a link for seems to be a pretty good model for what we're trying to do.

The way smugmug works may be useful in a way too - each contributor could have the option of a personalised landing page that can be either incorporated as their own domain or a sub-domain of their website.

Pixart · « **Reply #26 on:** September 17, 2010, 11:34 »

Have you talked to SmugMug though? I tried to approach them last week about a mirror site. They don't post any contact information and you send a personal message to the Pres and GM and they ignore. I think Zenfolio may be a better choice than SmugMug anyway.

sharply_done · « **Reply #27 on:** September 17, 2010, 11:47 »

This isn't going anywhere if people are balking at a $1000 investment - in terms of generating startup capital that's chicken feed. And getting 1000 semi-pro people to pony up that amount: you're already seeing the odds are long, so good luck with that. Personally, I wouldn't go anywhere near it unless you were asking for a $10k minimum investment and had a board of directors selected who together had decades of experience in dot-com startups, internet marketing, and stock photography.

leaf · « **Reply #28 on:** September 17, 2010, 11:54 »

I have always thought it was a good idea and think an amount like $1000 would be a good sum for joining the coop. I think there would be a lot of strong opinions on the best way to run it though and probably a lot of controversy

People who submit to the site can be both coop owners and non-owners. If you try and shop and any coop grocery store you will be asked if you are a member. If you are not a member you will buy your goods like normal, no big deal. If you are a member of a coop your purchase is registered to see how much you will get back at the end of the year.

So, the poll I think is valid. Some people may want to submit to a coop but not invest in the coop. Others may want to invest and submit.

leaf · « **Reply #29 on:** September 17, 2010, 11:58 »

Quote from: sharply_done on September 17, 2010, 11:47

This isn't going anywhere if people are balking at a $1000 investment - in terms of generating startup capital that's chicken feed. And getting 1000 semi-pro people to pony up that amount: you're already seeing the odds are long, so good luck with that. Personally, I wouldn't go anywhere near it unless you were asking for a $10k minimum investment and had a board of directors selected who together had decades of experience in dot-com startups, internet marketing, and stock photography.

I agree with you too. I think the actual number of people who would be interested in investing any amount of money is pretty small, like a 100-200 max. However those 100-200 people would probably be willing to invest a serious amount if $$ of the coop was really well organized. I think it would be a smarter plan to purchase a company that already exists than to build up a new company. Surely one of the promising start up stock sites or would sell for 1 million.... the staff could also stay on. How much would Yay sell for??

sharply_done · « **Reply #30 on:** September 17, 2010, 12:02 »

Quote from: holgs on September 16, 2010, 10:21

The challenge will be to have a royalty structure that maximises the payout to contributors, while still providing enough cashflow to sustain a professional agency. Maybe a fixed percentage in addition to a regular distribution of profits in proportion to income earned?

Whatever the case is would need to be written in black and white without a "we can change it at our discretion" type clause.

I would think the exact reverse to be better. Why not create a new breed of agency that is totally transparent to its investors, where commission rates vary on monthly/weekly/daily basis according to revenue and expenses? Saturday and Sunday are low-selling days, so you could have those as 0% commission days at startup or when you're saving for a special project (e.g. upcoming seasonal promotion). Need cash to upgrade systems? Uh oh, we have to reduce commissions. Want to reward the patience of contributors or celebrate a milestone? Wooyay, it's a 100% commission day!

leaf · « **Reply #31 on:** September 17, 2010, 12:15 »

I think variable commissions from day to day could get confusion and seem quite unfair when you get 20 extended licenses on Sunday, 0% commission day.

But having variable commissions by the month, or year would certainly seem wise to me. Or else have something like 20% or 10% commissions as standard then pay out 'bonuses' at the end of the year based on your overall earnings that year and the net income of the site.

gostwyck · « **Reply #32 on:** September 17, 2010, 12:41 »

Quote from: sharply_done on September 17, 2010, 12:02

Why not create a new breed of agency that is totally transparent to its investors ...

I quite like the idea of a totally transparent agency even if it wasn't totally owned by the contributors. I'm sure lots of businessmen would be happy accepting a certain percentage of sales as their earnings for running it. The microstock market today is worth something like $500M annually and is still growing. If our theorectical agency could do what Istock has done and grab half of the market it would be serious money. Even 10% of $250M annual earnings would be pretty healthy payment for running it. Some of the profit would be re-invested in the business and the rest paid out to the owner-contributors as bonuses.

Maybe we need to talk to Peter of Stockfresh or one or two other guys already in the business? The main reason that most agencies fail or never get anywhere is simply lack of funding. They can't afford the marketing and they have to pay out a comparatively high percentage to contributors to make up for the few sales. It's kind of a vicious circle which means they never get to compete with the big boys.

Fotolia have demonstrated how quickly a well-funded outfit can grow in this game. It could be done again __ but this time by us. Once the formula was proven to work it could have a snowball effect as contributors flocked to join removing their ports elsewhere. Three to five years from now it could be the only game in town.

jareso · « **Reply #33 on:** September 17, 2010, 12:42 »

Leaf, I think it will be possible to find much more than just 100-200 people that would want to invest in it. But there will need to be some real plan that will help them to decide.

Btw. I personally like this idea of photographers owned agency very much...

CPI · « **Reply #34 on:** September 17, 2010, 12:47 »

Yes , both

Lizard · « **Reply #35 on:** September 17, 2010, 12:57 »

I was for that last time we discussed about that , and I'm even more for something like that now , so count me in.

I like more the idea to start from nothing than to try to buy existing site , but its not so important.

Xalanx · « **Reply #36 on:** September 17, 2010, 13:21 »

Of course it's easier to buy an existing agency, it will spare a lot of time regarding many aspects. As long as its features would take less time to change (to fit our needs) than to build new ones from ground up.

luissantos84 · « **Reply #37 on:** September 17, 2010, 13:45 »

Quote from: Xalanx on September 17, 2010, 13:21

Of course it's easier to buy an existing agency, it will spare a lot of time regarding many aspects. As long as its features would take less time to change (to fit our needs) than to build new ones from ground up.

I guess a new brand would be nicier once many buyers or contributors are not happy with those existent agencies..

What are the steps to create this new agency?? After getting the $...? Getting a web designer?

Xalanx · « **Reply #38 on:** September 17, 2010, 14:01 »

Quote from: luissantos84 on September 17, 2010, 13:45

Quote from: Xalanx on September 17, 2010, 13:21
Of course it's easier to buy an existing agency, it will spare a lot of time regarding many aspects. As long as its features would take less time to change (to fit our needs) than to build new ones from ground up.

I guess a new brand would be nicier once many buyers or contributors are not happy with those existent agencies..

What are the steps to create this new agency?? After getting the $...? Getting a web designer?

Oho, too many steps. And a rebranding will be ok. Everyone will find out soon enough that the agency X is now a co-op. And here comes the big cash to be invested in marketing...

Kone · « **Reply #39 on:** September 17, 2010, 14:12 »

Quote from: sharply_done on September 17, 2010, 11:47

This isn't going anywhere if people are balking at a $1000 investment - in terms of generating startup capital that's chicken feed. And getting 1000 semi-pro people to pony up that amount: you're already seeing the odds are long, so good luck with that. Personally, I wouldn't go anywhere near it unless you were asking for a $10k minimum investment and had a board of directors selected who together had decades of experience in dot-com startups, internet marketing, and stock photography.

I agree with you too.

travelstock · « **Reply #40 on:** September 17, 2010, 14:17 »

Quote from: Pixart on September 17, 2010, 11:34

Have you talked to SmugMug though? I tried to approach them last week about a mirror site. They don't post any contact information and you send a personal message to the Pres and GM and they ignore. I think Zenfolio may be a better choice than SmugMug anyway.

My account with them comes up in Oct - I'm probably not going to renew it. Their support seems to be a little -well- smug. My point wasn't so much about actually having any connection with them, more about a similar feature - the ability to have personalised galleries and URLs for members who want that feature. So for example at the moment my smugmug gallery is at http://photos.veoelmundo.com/.

luissantos84 · « **Reply #41 on:** September 17, 2010, 14:19 »

Quote from: Kone on September 17, 2010, 14:12

Quote from: sharply_done on September 17, 2010, 11:47
This isn't going anywhere if people are balking at a $1000 investment - in terms of generating startup capital that's chicken feed. And getting 1000 semi-pro people to pony up that amount: you're already seeing the odds are long, so good luck with that. Personally, I wouldn't go anywhere near it unless you were asking for a $10k minimum investment and had a board of directors selected who together had decades of experience in dot-com startups, internet marketing, and stock photography.

I agree with you too.

so 10M ?

Kone · « **Reply #42 on:** September 17, 2010, 14:24 »

Quote from: leaf on September 17, 2010, 12:15

I think variable commissions from day to day could get confusion and seem quite unfair when you get 20 extended licenses on Sunday, 0% commission day.

But having variable commissions by the month, or year would certainly seem wise to me. Or else have something like 20% or 10% commissions as standard then pay out 'bonuses' at the end of the year based on your overall earnings that year and the net income of the site.

I think the commission rate should be fixed and at least 50%. We are trying to make something better than other microstock sites? Is that correct?

Kone · « **Reply #43 on:** September 17, 2010, 14:27 »

Quote from: gostwyck on September 17, 2010, 12:41

Quote from: sharply_done on September 17, 2010, 12:02
Why not create a new breed of agency that is totally transparent to its investors ...

I quite like the idea of a totally transparent agency even if it wasn't totally owned by the contributors. I'm sure lots of businessmen would be happy accepting a certain percentage of sales as their earnings for running it. The microstock market today is worth something like $500M annually and is still growing. If our theorectical agency could do what Istock has done and grab half of the market it would be serious money. Even 10% of $250M annual earnings would be pretty healthy payment for running it. Some of the profit would be re-invested in the business and the rest paid out to the owner-contributors as bonuses.

Maybe we need to talk to Peter of Stockfresh or one or two other guys already in the business? The main reason that most agencies fail or never get anywhere is simply lack of funding. They can't afford the marketing and they have to pay out a comparatively high percentage to contributors to make up for the few sales. It's kind of a vicious circle which means they never get to compete with the big boys.

Fotolia have demonstrated how quickly a well-funded outfit can grow in this game. It could be done again __ but this time by us. Once the formula was proven to work it could have a snowball effect as contributors flocked to join removing their ports elsewhere. Three to five years from now it could be the only game in town.

You are aiming too high

travelstock · « **Reply #44 on:** September 17, 2010, 14:29 »

There's no reason why you couldn't have several levels of investment - for the top 200 contributors, $1000 represents less than 1 weeks income at current levels. At the top 2000 level its probably more like 1 months income. At these levels, yes 1000 is a pretty small investment, but at lower levels its a lot to commit to.

Kone · « **Reply #45 on:** September 17, 2010, 14:31 »

Quote from: luissantos84 on September 17, 2010, 14:19

Quote from: Kone on September 17, 2010, 14:12
Quote from: sharply_done on September 17, 2010, 11:47
This isn't going anywhere if people are balking at a $1000 investment - in terms of generating startup capital that's chicken feed. And getting 1000 semi-pro people to pony up that amount: you're already seeing the odds are long, so good luck with that. Personally, I wouldn't go anywhere near it unless you were asking for a $10k minimum investment and had a board of directors selected who together had decades of experience in dot-com startups, internet marketing, and stock photography.

I agree with you too.

so 10M ?

please

gostwyck · « **Reply #46 on:** September 17, 2010, 14:48 »

Quote from: Kone on September 17, 2010, 14:27

You are aiming too high

No I'm not. If anything I'm massively under-selling the concept. This is the internet age. Look what happened at Google; look how fast Facebook took off __ and a ton of other businesses too. You can go from virtually zero to total market dominance inside of 2-3 years.

I don't think most contributors are aware just how staggeringly profitable microstock really is. All the 4 main agencies were profitable enterprises when images cost a fraction of what they do now. Since then they've mostly reduced commissions (i.e. costs) whilst also enjoying economies of scale and put up prices several times.

You generally know what commissions are paid on your own sales so run the figures backwards and work out how much money your images actually sold for in any given month. In my own case I reckon my actual sales are roughly 4x what I actually receive. With our own agency I am positive that we could at least double our earnings whilst still leaving plenty left to cover all cost and re-investment in the business.

Would we offer subscriptions in our own agency? That would be an interesting one to discuss!

travelstock · « **Reply #47 on:** September 17, 2010, 15:08 »

Quote from: gostwyck on September 17, 2010, 14:48

Would we offer subscriptions in our own agency? That would be an interesting one to discuss!

I think it would be best to firmly commit to not offering subscriptions, then turn around and offer subscriptions with no opt-out once everyone had uploaded a massive number of files...

Kone · « **Reply #48 on:** September 17, 2010, 15:12 »

Quote from: gostwyck on September 17, 2010, 14:48

Quote from: Kone on September 17, 2010, 14:27
You are aiming too high

No I'm not. If anything I'm massively under-selling the concept. This is the internet age. Look what happened at Google; look how fast Facebook took off __ and a ton of other businesses too. You can go from virtually zero to total market dominance inside of 2-3 years.

I don't think most contributors are aware just how staggeringly profitable microstock really is. All the 4 main agencies were profitable enterprises when images cost a fraction of what they do now. Since then they've mostly reduced commissions (i.e. costs) whilst also enjoying economies of scale and put up prices several times.

You generally know what commissions are paid on your own sales so run the figures backwards and work out how much money your images actually sold for in any given month. In my own case I reckon my actual sales are roughly 4x what I actually receive. With our own agency I am positive that we could at least double our earnings whilst still leaving plenty left to cover all cost and re-investment in the business.

Would we offer subscriptions in our own agency? That would be an interesting one to discuss!

Of course gostwyck, there are some successful companies, but at same time many also try and fail. Let's hope you are right.
Subscriptions, that is the question!

Microbius · « **Reply #49 on:** September 17, 2010, 15:16 »

Quote from: Kone on September 17, 2010, 14:24

Quote from: leaf on September 17, 2010, 12:15
I think variable commissions from day to day could get confusion and seem quite unfair when you get 20 extended licenses on Sunday, 0% commission day.

But having variable commissions by the month, or year would certainly seem wise to me. Or else have something like 20% or 10% commissions as standard then pay out 'bonuses' at the end of the year based on your overall earnings that year and the net income of the site.

I think the commission rate should be fixed and at least 50%. We are trying to make something better than other microstock sites? Is that correct?

This is the wrong way to look at it.
It has to feel and be different to the other sites.
Photographers wouldn't get anything but a minimal percentage on an ongoing basis, but the company would be run for them. All profits would be made for their benefit and they would get them as a bonus at the end of the year.
People have to believe/ know that the site is run for them. If they work to make the site a success there's no limit to what they could earn, but if the site fails then they only get the minimal payout.
All financials would be transparent to all members.
All members should have a way of really getting their voices heard on an ongoing basis. There would have to be a board, but maybe one much larger than traditional companies. Perhaps made up of the 100 biggest sellers from the previous year, they could get to vote on all major changes to the site.

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Author Topic: New co-op owned RF/RM agency (Read 23029 times)

travelstock

Pixart

sharply_done

leaf

leaf

sharply_done

leaf

gostwyck

jareso

CPI

Lizard

Xalanx

luissantos84

Xalanx

Kone

travelstock

luissantos84

Kone

Kone

travelstock

Kone

gostwyck

travelstock

Kone

Microbius

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