About a week ago, Unsplash announced that they had raised $7.25 million, along with plans to bring cryptocurrency to its free stock photo service. While most see their move as a potential Shutterstock killer, Unsplash could end up becoming a potent competitor to Instagram, Pinterest, and Snap as they share more DNA.
A short review of the hard numbers as those are explicit enough:
- Over 2,083 Unsplash photos are viewed across the web every second.
- 1,231 API partners ( include: Trello, Medium, InVision, Google Slides, Lonely Planet, CodePen, Adobe, Weebly, FiftyThree)
- 5.4 billion photos are viewed a month
- 48 billion photo views since 2013.
- 12 images downloaded per second, more than double of Shutterstock (5.5 images per second)
- Only 400,000 curated images, downloaded more than 310 million times.
- 25 million+ creators who use Unsplash.
With such numbers, how can Unsplash find a path to profitability? There are a few monetary models Unsplash could decide to approach:
A Shutterstock killer?
The most obvious is an evolution of the stock photo model. With partners like Medium, they could easily institute a payment per usage that would be fully automated. Here is how it would work: A Medium user would write their entry, select one or more Unsplash image and hit the “publish” button. They would automatically be deducted a token ( or fraction of) from their account. Done. Via the API, payment to the Unsplash photographers would be sent automatically. No processing, no royalty calculation, no bank fees, no complicated licensing negotiation. Purely seamless. The only work that would need to be done would be for the Medium user to periodically refill their tokens, a process which could also be automated.
Since current photographers are used to giving images for free, any payment would be appreciated. And with the volume experienced by Unsplash, those fees could quickly add up to substantial amounts. Another version could make those fees voluntary donations instead, allowing users to decide how much they would like to donate to each photo. While this might insert a little traction in an otherwise completely seamless process, it would also reinject the community spirit back into the payment process. Each user could thus show their level of appreciation, furthermore incentivizing creators.
Replicate this model with the 1,231 API partners UnSplash currently has (including Google Slides, Trello, Adobe and more) and this could quickly become a very lucrative business. It would, as a very beneficial side effect, also quickly make the cryptocurrency used by Unsplash gain legitimacy ( and value) as it would be truly used in high volume, regular value exchange.
Currently, Unsplash has made it clear that it will not go down this path. ” It won’t be a model where photos are going to be paid for with cryptocurrency” recently wrote founder and CEO Mikael Cho, adding: “It will be a model that leverages the unprecedented distribution Unsplash photos gain to bring as many opportunities to contributors as possible while maintaining the open, free-to-use principles of the community.”
In other words, Unsplash does not plan to charge for images. Ever. Crazy, you say? Well, take a look at another company that built a vibrant photo community for free and ended it becoming a multi-billion business:
An Instagram killer?
A second option for Unsplash is to leverage the community they built. The obvious approach would be to turn its community into an advertising cash cow. Build tools brands could exploit to leverage the 5.4 billion views a month Unsplash delivers. Slapping ads on existing images would alienate their users, both creators, and users. Instead, they could offer brands the opportunity to add their images to the Unsplash collection, charging them a fee to be part of their tightly edited offering. They would, obviously, make sure the content is creatively on par with the rest of the images. In exchange, brands would then have the opportunity to give away, for free, images that contain their logos or product, perfectly fit to be used by thousands of sites worldwide. Very similar to the way some brands currently use Instagram ( Mercedes, BMW, Chanel..). Everybody wins.
However, unlike an Instagram or a Snap, Unsplash does not have its own closed proprietary platform. Its audience is spread out over thousands of sites or apps. Furthermore, it has no audience information. Since anyone can download an image without registration, the company has no idea what demographics they reach. In other words, as of today, it lacks all the fundamental tools advertisers would need to adopt it. Not that they couldn’t build it ( after all, it took Instagram a while to build their own analytics tools).*
A Canva killer?
A third option for Unsplash to monetize itself would be to build paying associated services. Think a reverse Canva. The Australian company, recently valued at over $1 billion, offers online graphic design tools for free and charges for the images you want to use. Unsplash could do the opposite. Users would continue to select images, for free, first. They would them be offered a set of highly advanced online editing tools that would allow them to transform the images into finished banners or flyers. Upon download, they would be charged a fee. This could be one-off or subscription-based.
This would leave their core principle of offering images for free untouched while only charging for additional creative services. After all, Unsplash creators initially ran a company called Crew, servicing the graphic designer community. This would not be far off their historical debut.
There are a few challenges here. Can enough of the existing community of Unsplash users be seduced into becoming paying graphic tools users? Is the Unsplash content varied or special enough to attract the type of customers they seek? Finally, with already many companies offering similar services ( including giant Adobe) can Unsplash emerge as a market leader? The company certainly has the team, and will, to overcome these obstacles. But how long will it take and can the market wait?
A custom stock killer?
One of Unsplash biggest claim to success is how they bring high visibility to otherwise unknown photographers. Having a photo published on the free site can bring millions of views. The company could decide to capitalize on this by building a custom stock tool which would allow users to hire photographers via their platform. In other words, transform discovery into freelance employment. Instead of just access to a few free images, users would have the ability to hire one of the photographers for a specific, define shoot. It is a growing market, as proven by the recent acquisition by Shutterstock of Canadian based Flashstock. Unsplash would take a commission off each assignment in exchange for the management of the platform. Besides the welcome revenue stream, possibly in cryptocurrency, it would solidify its community strength by helping its creators generate rewarding income.
Unsplash has a huge advantage here over an otherwise crowded market: Brand recognition and the magnetism of its free site. Even with low conversion rates, it would significantly beat competitors just by the sheer size of its current audience. The downside, however, is that this is not a truly automated solution. Management of photo shoots still need a lot custom manual handling, making it expensive and costly to scale.
It seems that for now, the company is content in maintaining the status quo and continue growing on their current model. They do not seem pressured to rush into any monetization scheme. It’s understandable: The current and only value of the company today is their community. Any missteps in introducing a revenue channel could deflate it in an instant. But as they take their time, they are also gaining precious market feedback. The type that could lead to making their conversion a successful one.