Justin Miller was in quite a predicament last fall—the startup needed a path to profitability and he needed some new motivation to make it happen.
The dilemma might not make sense considering the facts. Four years of hustle had made WedPics a darling of the Triangle tech community, and a company to watch in the lucrative wedding industry, with acquisition offers and impressive partnerships.
Miller’s small team had mastered user acquisition and content marketing on the cheap—with hundreds of thousands of brides all over the world using the app each year to capture and collect moments from their big day.
Justin Miller, left, is CEO of WedPics, the Raleigh startup he co-founded with Idan Koren, seated middle, in 2011.
He’d managed to raise more than $10 million in venture capital from all kinds of sources: picky local investors who typically avoid consumer-focused companies and Silicon Valley VCs who often overlook our region, from a ‘Shark’ (without ever making an appearance on Shark Tank) and even virtual investors on AngelList.
And over 2016, the company had drawn more than $1 million in revenue, a significant increase over the year prior.
But passion is something that can’t be acquired with users, venture capital or sales.
It has to come from within.
And last fall, Miller and co-founder
Idan Koren had real worries that passion to own and monetize crowdsourced wedding photography was no longer there, for themselves or the team.
So they made a bold move, a “Hail Mary”, as Miller describes it. They owned up to their feelings to investors and the team. Along with a $900,000 bridge round, they asked for time to figure it out. And they wanted everyone’s input in doing so.
“We had to go from a company that was one of the best of the best at acquisition to having to figure out revenue,” Miller says. “We had forgotten what it was like to learn how to master a particular topic or focus area.”
It started with a two week pause, where Miller asked team members to take a break from their day jobs and come up with concepts. They could be wedding related, or something entirely different, like revolutionizing parking meters or taking on marijuana distribution in legal states (his examples, not mine).
“The only thing is that I need to understand market validation and a revenue model at point of conception,” Miller told the team.
Challenge: turning users into buyers
The revenue question was a big one for Miller and Koren. When they started WedPics, the primary goal was to get as many users as possible. Investors were funding that sort of company back then (and some, in Silicon Valley, still are). They trusted enough users would lead to either a sound revenue model or a compelling acquisition offer by a much larger company.
Miller’s team made that bet again when they launched an app called PHOTO after a 90-day development sprint in 2015. Aimed to keep brides for subsequent life events, it never took off the way WedPics had.
“It was a tough pill to swallow when it didn’t hit a home run like we thought it would,” Miller says.
Lister Delgado of Idea Fund Partners, a WedPics board observer, admits he thought WedPics could build enough strategic value through user growth that revenue would come once the company hit a certain scale.
Instead, he says, “we realized that revenue is important not only because of cash but also because it provides leverage.”
Though WedPics had briefly experimented with a paid app in 2012, the search for a revenue model really picked up speed in 2015. WedPics started offering a service for printing photos or albums from the digital albums. There were revenue-sharing opportunities when WedPics made a successful referral to another brand.
For a period, WedPics looked at being a one stop shop for everything digital surrounding a wedding—from finding vendors to setting up a wedding website.
And in January 2016, the team attempted advertising sales. Miller networked in the wedding space to do deals for “cost for impressions” and dedicated emails to WedPics customers. The timing didn’t work out in a lot of cases because most wedding brands wanted a bride with at least six months to go until a wedding.
WedPics typically brings in brides two or three months before their big day, and keeps them several months afterward.
“We spent four years nailing it and all the sudden, we were back at ground zero,” Miller says.
The trial and error over revenue caused some of the fatigue Miller was feeling late last year.
Still, WedPics continued to add new users.
And by May 2016, the team had started getting traction for in-app purchases like the ability to download high-res photos, use unlimited storage, customize photos with color schemes and graphics and remove advertising from the app.
Unfortunately, it was mid way through the wedding season. WedPics could only capitalize on the back end of the season.
Meanwhile, Miller knew that 2017 would be a make or break year for the company. Something had to change.
“We have to get this company to a point where we are showing a monster revenue opportunity, or that will be it,” he recalls thinking at the time.
Taking a step back = ability to move forward
All that considered, Miller was serious about moving on if there was a huge opportunity the team could jump into and the passion from the staff to make it happen.
Investors were on board too.
“If an entrepreneur doesn’t have their heart in the company, you don’t have anything,” says Delgado. “We wanted to know, ‘Do you want to do this?’ If they were not fully into it, we couldn’t move forward.”
Miller looked at the two-week experience a bit like starting over, only with a 15-person team that is already well-versed in execution across multiple platforms and with the PHOTO app experience providing confidence they could move fast. The bridge round was more like an early stage seed round. It was a runway if WedPics decided to start over.
Week one was all about dreaming and brainstorming. Week two was about applying that dreaming and brainstorming to the existing business.
“What are the best things we’ve come up with here and how can we put these ideas back into WedPics?” he asked the team to consider.
And that’s what got everyone excited to execute again.
“It gave us this breath of fresh air,” Miller says. “The best thing from that exercise was the fact that everybody had a newly found excitement.”
A key realization was that the WedPics app needed to feel like 2017, not 2012 with a bunch of pieces and functions added onto it over time.
And so priority No. 1 for 2017 was a complete remake of the platform. Developers worked to modernize the back end and front end designers and developers worked to update the user experience. All decisions were made based on data.
Branding, functionality and core competency around creating and aggregating photos would remain the same, but the app would be streamlined and simplified based on the features used the most. As an example, design decisions were made based on conversion rates versus aesthetics or trends.
“We’re bringing it all back to the idea of photo sharing and making it much more intuitive and fun experience,” Miller told me.
In-app purchases (ranging from 99 cents to $59.99 for the “diamond package”) are key to that, along with a more seamless experience for brides, guests and wedding photographers.
Both are reflected in the new app launched late in March and updated again last week, what Miller calls “the biggest update we’ve ever done” and “light years beyond what we had to date.”
For Delgado, the project has revealed a new excitement and eagerness to figure out how to make money from the strong WedPics user base.
“I always get excited about innovation and traction, and this team has innovated in many different ways, from product to marketing to the metrics they use, how they track user acquisition,” he says. “Sometimes circumstances prevent you from extracting potential and you have to pivot until you find the right fit or path.”
There’s still no end to the story. Relaunching a product is a huge risk, and Miller admits that some users aren’t happy with the changes.
But WedPics may not be here today without the deep introspection of its founders and team, and a willingness to come together and unite around a solution.
“All of us brought ideas to the table, not myself or Idan, but every person collectively came up with what this new version of WedPics will be,” Miller says. “It’s been a really cool effort thus far.”
Source : https://www.exitevent.com/2017/04/how-a-wedpics-hail-mary-led-to-a-new-app-plan-to-dominate-the-wedding-industry/