Recently, ZCOOL received $15 million of series B+ financing from Shutterstock, a NYSE-listed world-famous digital content supplier. This is the first time that Shutterstock has invested in an Asian distributor. ZCOOL completed its series B of financing in 2016.
ZCOOL was apparently not keen on financing. ZCOOL Founder and CEO Liang Yaoming said, “ZCOOL currently has enough cash flow and there is no shortage of money. The strategic significance of this round of financing is much greater than capital itself.”
ZCOOL launched this financing round to sell original Chinese visual designs to the world.
“Ecosphere” of the Design Field
ZCOOL has been established for 12 years and has 6 million registered users. More than 20,000 original works are uploaded on ZCOOL each day.
Most registered users are designers, photographers, illustrators, artists and design-related professionals. Relying on these 6 million users, ZCOOL created an ecological circle with originality as the core.
ZCOOL’s business consists of three main parts: its interactive designer platform ZCOOL.com, its original visual content provider HelloRF, and its educational art design platform Gogoup.
Of the three business branches, ZCOOL was established first and accumulated users. ZCOOL provides a platform for free communication and exchange of high-quality work. Users can freely comment on works and interact with their authors.
ZCOOL also creates opportunities for users to meet in real life. Designers can have in-depth discussions with their idols and fans. In the annual event ZCOOL CUBE, ZCOOL set up Cube Talk High-End Forum, Cube Fair Fun Bazaar and ZCOOL Award. Well-known designers from advertising, computer-generated graphics, games, fonts, design consulting, internet product design and many other fields shared ideas and exchanged opinions with ZCOOL users at the event.
Liang Yaoming said that the 6 million user base is one of the most prominent features of ZCOOL. Few competitors can accumulate so many high-quality users within a short term. ZCOOL further extended its original visual content platform, educational art design platform, online recruitment projects, design competitions, and paid voice programs, all of which center on its users.
In 2017, ZCOOL held 16 design competitions. A total of 15,183 designers participated in the competitions and uploaded 23,428 pieces of work. ZCOOL issued 1,724,000 yuan ($272K) in prizes and 1,227 gifts to participants.
ZCOOL held a Xiaomi MIX2 Full-Screen Poster Creative Design Contest with Xiaomi, and also has partnered with Tencent Entertainment in eight projects. ZCOOL has also put on a series of exhibitions and interactive activities to promote Xiaomi and Mi Home products. Through the competitions and job opportunities provided by ZCOOL, many designers were able to realize the commercial value of their work.
Sell Chinese Design Overseas through Shutterstock
Despite not being cash-strapped, ZCOOL received $15 million in series B financing from Shutterstock. For ZCOOL, the strategic significance is far greater than the money itself.
Shutterstock is one of the world’s largest commercial image providers. As early as 2014, ZCOOL partnered with Shutterstock to become its exclusive distributor in the China. Relying on ZCOOL, Shutterstock entered and successfully integrated in the Chinese market. With the help of Shutterstock, ZCOOL introduced foreign high-quality copyrighted content into China, and overcame resource barriers.
6 million registered users of ZCOOL became the first batch of Shutterstock library users. HelloRF is the general agency of Shutterstock creative pictures and videos in China. In 2016, the two sides again reached a five-year agreement. In 2018, Shutterstock invested in ZCOOL. This is the first time that Shutterstock has invested in an Asian distributor.
Liang Yaoming said that after this round of financing, the agreement between the two parties will develop into a longer and tighter strategic partnership. This is a milestone for ZCOOL and Shutterstock, and will also enhance cooperation between the Chinese market and the world’s top resources.
After the financing round, ZCOOL users will be able to access Shutterstock content and sell their original work on Shutterstock. The original content created on ZCOOL can be sold to the world through Shutterstock channels.
In the digital imaging industry, the West has accumulated numerous well-developed resources, but have relatively insufficient content from the East. After the partnership, Chinese visual content created by ZCOOL users complements the West image library, and ZCOOL users can sell their designs abroad.
ZCOOL said that it achieved technological and content integration with Shutterstock. After obtaining the investment, ZCOOL will learn and adopt Shutterstock’s leading operating model. Shutterstock has well-developed synchronization with Facebook, Microsoft, Google and other internet companies. ZCOOL will adopt similar methods to makes its designs available in searching engines, office software and advertising.
Liang Yaoming said that this round of financing will be used to optimize the ownership structure and to promote products. ZCOOL will also focus on the developing HelloRF to be a one-stop visual content provider. HelloRF will further expand its font and music-, sports-, entertainment-, and fashion-related graphics business in 2018.