Bahar Gidwani of Index Stock is wasting no time in spending the $18.6
million in venture capital he acquired in March (reported in the May printed
issue of Selling Stock).
On June 1st he acquired The Picture Cube, Inc. of Boston, which earlier
year acquired Third Coast Stock Source Inc., formerly of Milwaukee. Index will
retain the Boston office as base for the company's Editorial collection.
Two weeks later, on June 15th Index announced the acquisition of Stock
Imagery of Denver. While Stock Imagery has been somewhat regional in sales focus
in the U.S., it has an extensive global reach with agents in 50 countries
representing their catalogs. Index will retain the Denver office of Stock Imagery
and expand its sales efforts into the Mountain States. Index Stock now has
offices in New York, Los Angeles, Boston and Denver.
In May we reported to our on-line subscribers that 15 members of the Stock
Imagery team were dismissed without notice, including Phil Lawson who had been
chief operating officer and his wife Pamela who was creative director. The staff
remaining after the reshuffle numbers about 26.
Both Lawson and Garry Adams, the President of Stock Imagery, were involved
in discussions with Index that took place over serveral months prior to the
announcement. Sources tell us that there were some major disagreements between
Lawson and Adams over strategy and that Index insisted these issues be laid to
rest before they closed the deal.
Lawson was heavily committed to the "Imagegate" on-line delivery system, and to a
spin-off called "Weddinggate." After the dismissal of Lawson, Adams told us that the
"Imagegate" software was not working as promised, that development was way behind
schedule and that the "Weddinggate" idea would no longer be pursued because it
was not related to Stock Imagery's primary line of business.
Sources at Index tell us that they are reviewing the "Imagegate" software and
trying to see if there is any way to take advantage of the investment already
made, but it is unlikely that Index will try to operate two systems. Index has
announced that the entire Stock Imagery collection will be scanned into the
"TeleFocus Image Browser", giving Index clients and staff access to the images
from their own workstations. The Denver office will be completely
automated and integrated into the Index on-line network in the near future.
Sources not directly connected with either of the two companies, have told
us that Stock Imagery made an attempt to license
"Imagegate" to Zefa in Germany for $400,000, but the German agency was not
interested. There was also an attempt to market it to Visual Communications
Group in the UK, but VCG had no interest because of their committment to a
different system. We believe Stock Imagery photographers
should expect the "Imagegate" system to disappear.
A new 352-page Stock Imagery catalog, entitled "Fresh Catch," has been edited and
is still due out in October. Stock Imagery has been in business for 18
years, focusing especially on
strong nature photography, regional skylines, lifestyles, business concepts
and sports. The collection of approximately 200,000 selected images is very
tightly edited from the work of over 390 photographers.
Adams describes the match between Index and Stock Imagery as a "great fit"
that will benefit his photographers by adding a larger and more national
sales force and advanced technology. "While our international network has
been one of the best, our domestic reach has been hampered a little by our
location. There's going to be an immediate benefit to our photographers
from aligning with Index's national sales force," says Adams.
Peter Vollers will manage the day to day operation of the Denver office. While
the press release indicates that "Garry Adams will continue to be involved in
the creative process in an as
yet unspecified way, probably from South America" our sources indicate that Adams
will probably not remain a part of the management team for any significant period
Sources also tell us that current annual sales at Stock Imagery are in the range
of $2 to $2.5 million and that the price paid by Index for the agency was
about twice the annual sales.
We have no reliable information as to the amount
paid for The Picture Cube, but clearly it is a smaller agency. Sources tell us
that Index still has a lot of money to spend and that we should
expect to see more acquisitions in the not too distant future.
Sheri Blaney, Founder & President of The Picture Cube, Inc., will remain in
the Index Stock Boston office as a Managing Director. The Boston office will be
base for the company's Editorial collection. Given her experience and
understanding of the editorial market for stock (book publishing, not hard
news) Blaney will play an important role in Index's plans for expansion.
Blaney spent a number of years in publishing as an art and photo
editor before opening Picture Cube twenty-one years ago. She has built the
company into one of New England's leading sources of stock photography with a
national reputation in the editorial field and a prime source for photos of
multi-cultural lifestyles, New England
locations, world travel, underwater habitats, black and white contemporary
and vintage images, and many other subjects. The Picture
Cube's web site is located at www.picturecube.com.
In explaining why she chose Index, Blaney said, "We were
interested in an agency with the technological savvy that could bring us
into the electronic age. Index is the right match -- besides being
innovative, they treat their contributors with a great deal of respect.
Both Picture Cube and Third Coast photographers have a lot to gain by our
affiliation with Index -- their catalog production schedule and electronic
network will give our artists an increased opportunity for sales and
Index CEO Bahar Gidwani comments, "The Picture Cube has been one
of our content partners for some time, contributing images to our catalog
and CD products. We know their photographers and their staff, and respect
the quality of the images they have collected. Joining forces is one more
step in our plan to become one of the industry's dominant players."
The Picture Cube adds more than 400 photographers and 500,000 images to
the Index archive.
With the completion of these two acquisitions Index Stock will represent more
than 1,165 professional photographers and has more than 1.7 million photos in
its library. Index plans to produce and distribute five print catalogs this year
including two general purpose catalogs, a Sports & Leisure catalog, a Humor
catalog and a Medical catalog. It distributes 115,000 copies of the 240-page
general catalog, with about half going to its foreign agent network.
One unique feature about the Index system is that they scan a larger percentage
of their general file images than most other major agencies. This enables each
Index salesperson to access Index's entire collection of scanned images by
using their TeleFocus browser on-line. When a customer installs their TeleFocus
software, at no charge, he or she may also get full access to Index's entire
scanned images - not just those that are in Index's catalogs or on it's CDs.
Customers can download any of the images for layouts and comps and show them
to clients before committing to licensing them. For more information, visit
the Index web sites at www.indexstock.com and www.photostogo.com.
©1998 SELLING STOCK
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