CEO interview: 99designs CEO and president Patrick Llewellyn
A global company with over $35m raised in investment, Startups caught up with 99designs’ Patrick Llewellyn to get his insights on starting a business...
The ‘world’s largest’ graphic design company, 99designs has scaled rapidly since its launch in 2008, growing from a Melbourne-based start-up to a $35m-backed internationally-recognised company with headquarters in Silicon Valley.
A customer base stretching globally, offices in nine locations, and multi-million dollar revenues, we caught up with 99design’s CEO and president Patrick Llewellyn to learn more about the company’s rise to tech start-up success and the key advice the entrepreneur has to share on starting and growing a business…
What were the first couple of years at 99designs like?
“I joined 99designs in 2009 and moved to San Francisco in 2010. At that point there was only a team of eight people so we were still very much a bootstrapped business. We focused on hiring developers when we could afford to and building the best platform. We had customer support and email support from Australia and we weren’t really able to do much more than that. By moving to Silicon Valley we really wanted to engage with our customers as the majority were actually in the US.
You went down the venture capital route to grow. Why was that and how did you use the investment?
“In 2011 we raised money from Accel Partners which gave us the opportunity to start thinking more aggressively about how we could achieve growth. We actually bought a business in Berlin which gave us a European base. We’ve continued to look at international expansion as one of our growth drivers and we’re now available in nine languages with people around the world using our service. When we move to the US, we started doing a lot of tech, and realised how important it was for us to be connected to our small business customers.
There may have been a perception that 99designs was a value proposition only. How has the business evolved to change that and is mass market appeal the aim?
“Our transaction value is now over $500 on average, which is pretty significant, so there needs to be a level of trust there. One way of building trust is to be available. When we first put the phone number up on the site for a test, we were staggered by just how many people were ringing up. […] Contact forms aren’t enough, it’s that phone number that you need. Now we have live chat and supervised phone support, it’s really important for us to make our customers aware that we’re there to help and that’s improved the way we run the business.
How did you seize on the movement towards crowd sourcing and keep the buy-side and suppliers happy?
“Design contests are what we’re known for – it’s that kind of crowd source element: post your job, get sent ideas, and pick the one you like. People would say so why do designers spend their time on a design contest when they don’t have a guaranteed customer? Well when they secure a customer through a design contest, specifically because it has been a competitive process, the customer feels a great deal of loyalty and […] it will usually lead into an ongoing relationship. We’ve always been happy if that relationship was to go offline, or if they stay online with us. That’s really part of the value proposition that we provide to our community.
“We’ve really started to evolve our platform over the last couple of years and introduced out one-to-one projects which is all about the relationship with the designer. Typically you may have met that designer through a design contest but this is more about looking through a design portfolio and reaching out directly to the website designer you want. We built it based on the demand we were seeing, we always knew it’s was one of the key value propositions to what we did.”
How has the market for freelancing changed since 99designs launched?
“We’re seeing an explosion in freelancing. Design for us has always been an industry dominated by freelancers. The recession of the last five years has seen more people become self-sufficient, they’ve realised they can’t rely on the government or a job from a big corporate because it’s not as stable as it once was. New generations of the workforce like the idea of being mobile, the EU has opened up and we’re seeing an international mobile market. Apps and online is making people so much more connected.
How revolutionary has the shift to the wisdom of crowds been in the last decade?
“I’ve always thought crowd sourcing is something that’s really good at solving discreet problems. It’s difficult to get the crowd to work on super complex problems because it’s hard to communicate but when you’re breaking things up you need to be relatively discreet so using the crowd and social is a great way of solving the problem.”
To read the second part of our interview with Patrick Llewellyn, where he talks about building and internationalising a fast-growth company, click here.