Lilipip, With Recent Focus on Animated Ads, Looks to Keep Growing Without Venture Capital
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another friend finally suggested that this could be her life’s work, Oustiougova said.
So four years ago, Lilipip (short for little people) was born. Oustiougova entered the University of Washington’s business plan competition, and won a prize for best consumer product. “After that I had no idea what I was doing,” she said. “People told me, ‘Now you have to incorporate and raise money.'” After trying to find investors, Oustiougova eventually just opened up a bunch of credit cards. “So basically the business is running on credit cards,” she said.
In Lilipip’s first incarnation, Oustiougova licensed content from YouTube and other sites, screening it for videos appropriate for kids and making them available to download for small fees. The problem, Oustiougova said, is that everyone loved the idea, but nobody wanted to pay for it. She’d already developed relationships with animators around the world through all the videos she’d licensed over the years, and in May 2008 she offered to make an advertising animation for a startup company to get some extra cash flow. “At first, I thought it would just let us live through the summer,” Oustiougova said. “Then I realized that was the business.”
The name Lilipip stayed—now “little people” refers to small businesses and startups, Oustiougova said, although one of her early (and favorite) projects was a video for Zappos, the online shoe store acquired by Amazon for shares and cash totaling approximately $847 million in July. She feels Lilipip is different from other ad companies out there because of its transparency in all aspects of the business. Oustiougova calls it “open source creative.” The company offers different pricing packages for the videos, ranging from $4,000 to $18,000, with different levels of involvement that the client is involved in. At the $4,000 end, Lilipip provides illustration, storyboards, animation, and stock music; at the highest end, it adds in such touches as script, photography, original music, voice-over, and sound effects.
Lilipip’s business is mainly drummed up through word of mouth, Oustiougova said, but she’s also very active on Twitter. That’s where she made the initial connection with the Zappos CEO, Tony Hsieh. Local clients include Kimberly Baker Jewelry, Intellectual Ventures, Seattle Web Group, MOD Systems, Waggener Edstrom, Perfect Pixels, LKK Partners, Shiftboard, and Cascadeo.
Openness about the price and the all-included nature of the pricing packages is important to Oustiougova. “There’s this mysterious black box whenever you’re hiring anyone creative. It’s always, ‘Let’s sit down and find the scope of the project and then figure out how much it costs,'” she said. “But that’s the first question of every business, how much does it cost? A small business can’t afford to lose that time.”
Unlike other agencies, Oustiougova says, Lilipip freely reveals information about its artists and creative contractors, even promoting them on its blog, so that if clients enjoy working with a certain contractor, they’re free to contact them independently in the future. Lilipip also gives all source files to the customer, which is unique as far as Oustiougova knows.