Shutterstock, Inc. has announced that on January 4, 2018, the Company invested $15.0 million in convertible preferred shares issued by Zcool Network Technology Limited ("Zcoolto”).
Zcool's primary business is the operation of an e-commerce platform in China whereby customers can pay to license content contributed by creative professionals. The platform has nearly six million registered users. Zcool has been the exclusive distributor of Shutterstock creative content in China since 2014.
Shutterstock's $15 million investment is equivalent to a 25% fully diluted equity ownership interest and further expands Shutterstock's presence in this fast growing market. In connection with its investment, Shutterstock has also appointed a director to ZCool's Board of Directors.
"China is a strong market for creative content use in print and digital across all industries, and I am delighted to strengthen our relationship with ZCool," said Jon Oringer, Founder and CEO of Shutterstock. "We recognise ZCool's achievement in building a strong creative community and their long term plan to cultivate a complete creative ecosystem. This investment forges a deeper partnership for us in China and provides the thriving and dedicated creative communities and global businesses across China access to Shutterstock tools and assets."
This major strategic commitment builds on the successful operational relationship Shutterstock and ZCool have had since 2014 when ZCool first became the exclusive distributor of Shutterstock creative content in China. This multi-year strategic partnership was extended in 2016, and includes creative images, and video collections for commercial use as well as providing Shutterstock enterprise plans to Chinese customers. The content is distributed through ZCool's e-commerce page, HelloRF.com and Shutterstock's Enterprise content is accessed through their Plus.HelloRF.com site. In addition, through utilization of ZCool's API, Shutterstock's content now powers large technology platforms in China such as Tencent Social Ads and WPS Office.
Webdam
On February 15, 2018, Shutterstock entered into an agreement to sell its Webdam business, including certain contracts and liabilities, to Bynder for an aggregate purchase price of $49.1 million, payable in cash, and subject to certain customary closing adjustments for a transaction of this kind. The company purchased Webdam in March 2014 for $14.4 million. For the year ended December 31, 2017, Webdam revenues were approximately $16.2 million.