LookStat Closes $500K from Founder’s Co-op, Other Investors
Seattle-based LookStat, which develops Web-based analytics, workflow automation, and earnings tracking software for the microstock photography industry, says it has closed a $500,000 Series A financing round from Founder’s Co-op and individual investors in the Seattle and San Francisco areas. Xconomy broke the preliminary news of the funding (but not the amount) last month, while reporting on a talk by investor Andy Sack of Founder’s Co-op.
To get the details, I met with LookStat’s co-founder and CEO, Rahul Pathak, a few weeks ago. Pathak was previously vice president of product management at Judy’s Book in Seattle (which Sack founded), and also spent time in the San Francisco Bay Area as a co-founder of Quova, and Boston as an MIT alum in computer science. LookStat focuses on microstock photos, which are cheap images provided on the Internet by a wide range of photographers, including hobbyists. “Microstock is growing like crazy,” Pathak said, “but it’s still very early days.” In particular, there haven’t been dedicated tools for automating workflow and telling microstock contributors (photographers) which kinds of photos are selling where, for instance. “Nobody’s approached it from a technical perspective,” he said.
Pathak and fellow co-founder Casey Zednick, LookStat’s chief technology officer, consider themselves “early innovators” in the microstock market, which Pathak says totaled about $200 million in 2007, and is expected to become a $600 million market in 2010 and 2011 (out of an overall commercial stock photography market of $2 billion).
The startup’s Web platform is now in public beta trials. As Pathak explains, “We want to sell tools to people. Rather than mine for gold, let’s sell the picks and shovels. It played to our strengths better as technologists.”
The next steps for the company are to expand its site and give photographers more detailed sales information about, for example, which categories of photos are selling at which time of year. From Sack’s perspective, LookStat represents a “proven team with a capital-efficient operating model” in a “fast-growing niche market.” Pathak didn’t give any specifics about revenue models, but it’s safe to say LookStat is looking to collect a fee for its tools in a wide-open and highly targeted market. We’ll be watching closely to see how it performs in a difficult sales climate.