Interview: Bruce Livingstone, CEO, istockphoto.com

Recently I met Bruce Livingstone as a shared friend of Guy Kawasaki, and asked him some advice for a friend regarding the photo market. After learning about each other, he asked to interview me for his site, istockphoto.com. I thought, "Why just interview me? Why don't I interview him?" This is the first interview he's given.

Bruce created iStockphoto.com, a profitable photographer / designer community site.

Let's see what this Canadian CEO has to say for himself...

How did you learn what it takes to succeed?

Through my experience it’s broken down into tenacity, trial and error -- but more importantly, interpretation. The first being easy notions, where there is a formula for utilization of interpretation made up of three simple parts:

a) Listening to what your suppliers and customers want
b) Intuitive predictions for your supplier's and customer's immediate and future needs
c) Taking advice and criticism with the same value

What books have you read that embody your core principles...so much so that you wish you wrote those books?

I honestly don't read a lot of business books that embody my core, but two in particular from Guy Kawasaki really speak to me. I wish I were born 5-10 years earlier so I could have had the opportunity to have worked at Apple and shared the same experience as Guy. It sounded like a life shaping experience.

a) The Macintosh Way
b) Rules for Revolutionaries

Give me 1-3 expand-your-mind book recommendations?

The Forged Coupon and Other Stories by Leo Tolstoy

How the Scots Invented the Modern World: The True Story of How Western Europe's Poorest Nation Created Our World & Everything in It by Arthur Herman

The Blind Assassin by Margaret Atwood

The Sacred Balance: Rediscovering Our Place in Nature by David Suzuki

What are the three most important experiences or skills that are invaluable as a CEO?

a) DIY: Do it yourself, and do not pay anyone to do it for you
b) Community Mindedness: Get lots of help. Turn and hire the squeaky wheels and anyone else who truly believes
c) Failure: Everyone needs to fail (preferably more than once)

Why did you start istockphoto? Why is it succeeding?

iStockphoto was part mistake, and part art project. It started because my first stock photography company, publishing by CD-Rom, was unable to successfully go to market with its limited funds. As an experiment I started giving away my photographs. Members to the site suggested that they would also supply photographs if we built the mechanism. Jeffrey Zeldman and I were chatting about the old subscription models like ArtToday.com and how iStockphoto could be different. iStockphoto started as a simple photo sharing system for designers and photographers. The first few instances were an intentional rip on Apple's "iXXXX" products. I was bitter (http://www.istockphoto.com/bitter) because I underestimated what it would take to bring a product to market. We built a critical mass of members after a couple of years and turned commercial in 2003.

What makes iStockphoto different from other photography sites? For the photographer and the end users?

Innovation is key in what we do. iStockphoto was the first to market with a community-based, open market system for buying and selling images which gave us the technical and marketing lead. For both photographers and designers, there is a massive audience and a constant supply of new images. The community interaction is what makes iStockphoto as strong as it is. Anyone can copy the iStockphoto model, but it would be difficult to create a community like iStockphoto today. The real secret at iStockphoto is the openness and connection between photographers and designers. iStockphoto is tangibly nothing but systematic code and formulation of ideas. The true movement is the interaction that the web site facilitated. Numerous private deals happen through the website. People get hired for all sorts of interesting projects. Other websites haven’t reached the ease of communication within the community.

In hindsight, could you have reached profitability earlier, and if so, what would you have done differently?

I don't think I could have reached profitability earlier. We needed to create the market we're currently serving. There are many other websites that have borrowed our model – I’m proud to say it didn't exist before we launched in April 2000.

How do you grow your business?

During the first few years, it was like a snowball rolling downhill. It grew with it's own momentum. Each member was an evangelist. It was in their best interest to augment/build their own business with iStockphoto.  The website was designed to be viral and it has spread like a disease, a nice disease...a nice disease. In 2003 we had our first marketing budget and we've been partnering with great organizations like the National Association of Photoshop Users (NAPP). It's been a great relationship and it's much more effective than just buying media. In 2004 our marketing budget has quadrupled and we're leaning heavily on our new marketing manager, Kelly Thompson, to accelerate the momentum we've provoked.

How do you make sure your business is continuously improving, pushing the envelope, meeting customer needs and putting the hurt on competition?

If iStockphoto.com were a crown, we would hire the shiniest jewel of talent for each position. Pedigree is of no concern. Most of my team is made up of people I've worked with: teachers, ex-bosses - generally anybody who taught me anything valuable. For example, I used to work with Aaron Springer (http://www.istockphoto.com/jester) at a pre-press house. He taught me about developing film, making color keys and printing plates. That was in 1995. Now he's one of our best programmers. I don't think he has any training - I didn't ask. He's been a spectacular colleague.

Other than employees, what people have made the biggest impact to your success and why?

Mentorship. I've had some of the best mentors in the world from a wide cross section of industries. My mentors were also friends and angel investors. I've relied upon their experience and networks. Currently I have about a dozen that help me on a daily basis.

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Bruce Livingstone has spent his career in the graphic design/marketing and photography industries for over 10 years.  The last seven years he has acted as his own entrepreneurial incubator as the ex-President and now CEO of iStockphoto.com, iStockpro.com, Webcorelabs.com and Evolvs.com. In the past decade he worked for Image Club Graphics, Aldus Corp., Adobe Inc. and a handful of advertising agencies and pre-press  facilities. Bruce founded his first media company, Frequency Labs Inc. in 1997 (now Evolvs Media Inc.). He spends most of his days in the marketing, editorial and application development departments.

The Story of iStockphoto.com: iStockphoto.com was founded in May 2000, but the groundwork was laid in 1999 with Frquency Labs Inc., my first attempt at launching a stock  photography publishing company. As a boutique studio, Frequency Labs  produced and retailed 4 CD-Roms, (which can still be found in the iStockphoto.com web store). I decided to give away all 1600 or so  images from the CD-Roms on a web site. As an independent stock photographer I wanted to re-invent the traditional model of stock  photography sales. I worked off some ideas I had when I worked at Image Club Graphics from 1994-1996. The commerce model was loosely based on an arcade, micropayments with mechanisms for contribution and  accessibility. On May 10, 2000, iStockphoto was born. Today,  iStockphoto is the world's fastest growing collection of original, independent, royalty-free images in the world.

Comments

[Jim]

"I think an 80% take from any sort of agency business is too much. Also, that iStock is too secretive and undemocratic to make the claims that it does about nurturing its membership.It's this sniff of exploitation that for me counter balances the inovation. The mob/cult mentality in the forum is weird too."

Exactly. And the enthusiastic fans are basically getting shafted and they don't realize it. Total suckers who are giving away their content for peanuts and a pat on the head. Meanwhile Getty Inc. makes millions. These clowns who are making Getty rich wouldn't even be let in the front door at Getty's headquarters.

[another sucker]

I thought istock was the best thing since sliced bread when I joined. And I was still very happy with istock when I went exclusive.
However, over one year on and istock is cutting back on contributor services.
istock's 'inspectors' (the ones who approve/reject your images) are a laughing stock who know nothing about photography. Just look at their portfolios!
The forums are a police state, you can't even offer constructive criticism without being shouted down and stamped on by staff and a rabid group of fanatic contributors. And if you dare voice concerns you notice your approval rates suffer with ridiculous inspector reviews.
I'm seriously regret going exclusive with them and looking for a way out that wont cost me too much in lost revenue while I place my library elsewhere.

[Mike Plasun]

These guys are also Canadian and seem to be doing things the right way: http://www.zymmetrical.com

Fair trade ethics incl. 70% commissions for Artists. Hell, their programmer even came up with an improved version of 'Copyspace' over a weekend.

[Brent]

I am looking for some information on software to be able to build a site like istockphoto. I need software like this for pr purposes. Mainly i need a good way for pr firms to be able to search our photo library. Any one have any suggestions

thanks brent

[Typical iStock Sucker]

"They are taking a risk when I upload images, hoping that they will sell. They need the higher percentage to cover their administrative and storage costs."

LOL. A sucker born every minute.

Oh, yeah, istock is really hurting buy having to host your 1MB file on its multi terabyte servers. And they're taking a big "risk" that somehow you might lower their quality (not possible).

Oh, but, someone mentioned you get free email and cool looking financial graffics. Now you totally convinced me to give 80% of the money to them. Hell, let's make it 90% and call it even!!! I love iStock!!!

Typical (sucker) iStock Fan & Friend!!!!!!!!

[Curtis J. Morley]

iStockphoto is an industry revolution.

They are doing tremendous things to not only revolutionize photography, but also the way the world looks at commerce. The peer production, community effect, and pricing models are one of the turning points in how the world views photography and design. There are many knock-offs but none can compare to the original. You can gripe all you want about the royalties, but good photographers can make a substantial living with nothing but iStockPhoto. It also gives the novice a chance to gain a reputation and become a professional. Everyone benefits from the model and tools that are iStockPhoto. The designer gets fantastic photos for a minimal cost, the photographer gets royalties and what can be a substantial income, and the company gets what they deserve for creating such an amazing tool.

[mega2004]

I thought Istock was a good idea, which is why I joined. But then I found out it is run poorly. The image of an open-source type community is betrayed by a DMV like bureacracy. It's a real shame. Istock should offer a better rate ,and they would still make a killing. And they could let people manage their own image portfolios -- there's already a review system for customers, and let the market decide. And they could stop there censoring of the forum. They could but they won't, and especially now that Getty owns them, I reckon it will only get worse, since sooner or later the buck downloads is going to hurt their $400 download business.

iStock staff are rude, bullying censors. They make arbitrary decisions and censor out complaints in the forums, to create picture of a happy "community" that are all big "fans". In a snese, iStockphoto is Stalinism on the internet. Sycophant fans and ruthless administrators who tolerate no dissent.

iStock: Good idea gone bad. Maybe someone will, or already has, made a less annoying and more ethical version?

[Sonja Gockeln]

I was a contributing photographer at istock but have been moving away recently to ones where the returns are a little higher and fairer.
I hate to argue about pennies, but a lot of it comes down to the perception of the site. Istock started as a place for hobbyists - it is now big business and owned by Getty. The prices and returns were fine when it was a "warm fuzzy place" - now you're adding to the coffers of Microsoft (the people who own Getty).

I hope that newer sites like http://www.totallyphotos.com/ start pushing up the prices a little - where you get about $12 a sale and from 50-75% commission. It seems to run on a similar principle as istock, but just a bit fairer.
In some ways istock has become too big - pushing down prices to an unreasonable level. I guess though in the end it's the photographers who will decide where they sell their images.

[Mike Schrengohst]

80% is too much.

[Jacob Moisan]

Is it high? Yes. Is it worth it? Yes again.

Just think about all the cool tools that Istock gives you : easy to read financial statistics with cool graphics, big exposure of your work (especially when you are an Exclusive photographer), creative network, email inbox, control over your files and royalties, incredible service, weekly contests (image of the week, free file of the week, design of the week, artist of the week, etc.), huge forum to talk with other photographer about everything and anything, steelcage battles, users reviews on your files, comments, testimonials, easy, fast and effective search engine with copySpace technology and color profiles, possibility to do lightboxes and to manage galleries; AND many other cool things like free business cards (when you sale more than ? files). And a lot more that I'm forgetting right now.

In my opinion, the fee they keep is totally worth it!
Everything is there on the website to help you create your portfolio and to sale your images. All those tools and those efforts have their prices.
Istock is doing a lot for the design community and I'm glad they keep a high fee over my files if that can help them to continue their incredible efforts and work.

Here is my position over the question :

I work for istockphoto and istockphoto works for me.

Cheers

Jacob Moisan

[Richard Beebe`]

I am a contributing member at istock and I disagree that they under pay their photographers. They are taking a risk when I upload images, hoping that they will sell. They need the higher percentage to cover their administrative and storage costs. Once a contributing photographer sells enough images and decides that they want to be exclusive to istock, they are able to get a much higher commission rate. Some if this is due to the fact that istock doesn't have as much risk on that contibutor now. Istock is a grat company who has built a good communication level with both their clients and photographers. They also protect their photographers with some of their "terms of use" policies. Istock is definatley a one of a kind company.

[Decker Marketing]

Istockphoto still needs much, much improvement. Especially in the fee they keep for each sale, which is too high in my opinion.
Also check the following websites:

http://www.dreamstime.com/
http://www.stockxpert.com/
http://www.canstockphoto.com/

[More bitter than Bitter himself]

I agree with what Diane and Ian said, Istockphoto takes an unfair fee for each photo sold. They keep 80% of it. Now, imagine you are the photographer/illustrator and after all the hard work and creativity time spent coming up with excellent work, you put it online (in Istockphoto.com) and for each time someone buys it you will only get 20% of what they pay!!!! ISN'T THAT UNFAIR??? I mean, you are the creator of it, why do they have to keep 80% of the profit? At least in Dreamstime.com you receive 50%, which is not perfect but its better. I really wanted to be a part of it, but not until the situation improves (a lot).
If Mr. Livingstone is such agreat guy it is about time things change for the better (for the users I mean).

[Dianne Kerry]

Istock has so many great members, but the agency pays so little to the contributor. It's unfair, especially as a higher fee was given only after competition became tough.
The article is a little unfair, considering that no other sites are mentioned (Dreamstime.com, Shutterstock, etc).
Other than this, a nice story.

[ian murray]

I think an 80% take from any sort of agency business is too much. Also, that iStock is too secretive and undemocratic to make the claims that it does about nurturing its membership.It's this sniff of exploitation that for me counter balances the inovation. The mob/cult mentality in the forum is weird too.
Ian Murray

[theblackpreacher]

iStockphoto rules

[Ken Zirkel]

I think iStock in its own way is as revolutionary as Apple was in its day. It's exciting and fun to be part of that.