Vision and opportunity came together when 30-year-old Sydneysider Alec Lynch started DesignCrowd from his mum’s garage.
With $10,000 of his own money, three credit cards and lessons learnt from an earlier failed business venture, Alec Lynch dived headfirst into his second startup, DesignCrowd.
It was 2007, and the then 23-year-old had moved back home with his mum in order to scrimp and save. Those early days were some of his most difficult, as he worked solo towards his goal of building a crowdsourcing design marketplace that connects businesses looking for graphic designers with a pool of design talent from all over the world.
Today, DesignCrowd boasts 400,000-plus designers in every corner of the globe, from Australia to Singapore to Pakistan, India, the United States, the United Kingdom, Portugal, Croatia, Russia and beyond. Businesses post a project brief and their budget to the site, and interested designers respond with creative solutions. Often, the first designs come through within a few hours and the process is significantly cheaper than using a design agency. The business can feedback or message the designer directly for edits, after which they choose a winning design and download the files.
It’s an attractive formula, with the site processing upwards of $10 million worth of projects since it began. In 2014, DesignCrowd has a run rate revenue of $15 million per annum, and Lynch has ambitious growth plans to suit.
“Our plan from day one was to build a large, fast-growing marketplace,” he says. “In three years’ time, we want to be a $100 million business, and in four years’ time, $200 million. We’ve grown from three staff to 30, and now we want that team to turn into 100. And we want to go from 400,000 designers to 1 million.”
Lynch says this with absolute seriousness and determination. And there’s no doubt he’ll get there. When his first venture into online customer relationship management software failed, he followed the corporate path into strategy, working for management consulting firm Booz & Company. It was there that he first identified the opportunity to be a disruptor in the traditional design industry, and the idea for DesignCrowd was born.
“There were two very different challenges in the design industry. For businesses, it was expensive to get any kind of design work done, turnaround times were slow, and there was a lot of risk and uncertainty around the creative process,” he says. “For designers, you needed a portfolio to get a job, but to get a job you needed a portfolio. And if you look at the numbers, there are 20,000 people employed in design studios, and 60,000 people graduating without employment.”
The unveiling of the London Olympics logo reinforced everything Lynch was thinking.
“It cost £400,000 and took a year to make. It was widely criticised, and I honestly thought, ‘I’ve got friends who could have done a better job,” he says.
The time was right to launch DesignCrowd, so Lynch quit his job, took the plunge and worked day and night to build the business for the first two years. He had learnt the importance of capital from his earlier CRM foray, “our first client didn’t pay and it wasn’t possible to keep working without making sales and earning a wage,” he recalls. So in 2009, he went in search of angel investors for DesignCrowd, eventually securing $300,000. That enabled Lynch to bring on his partner from the CRM business, Adam Arbolino. Together, the pair grew DesignCrowd “13 or 14-fold” in two years.
In 2011, DesignCrowd started to garner global attention. “Australia was still our biggest source of sales, but we were starting to identify growth and opportunity in places like the US,” recalls Lynch.
In October that year, a $3 million investment from Melbourne-based Starfish Ventures “super-charged” the business and staff numbers eventually shot up from three to today’s 30.
DesignCrowd now generate 40% of their total revenue from the United States, and have only recently hired two staff members to maintain a presence on the ground.
“It’s been hard work to grow internationally, and remotely, but it is possible,” says Lynch.
Curiously, DesignCrowd’s expansion into the UK hasn’t been as successful.
“In theory, the UK market should be bigger than Australia but we haven’t been able to replicate our success,” he says. “And in India, we’ve attracted a huge number of designers, but we’ve not been as successful getting small businesses to use the service. They like to pay cash on delivery, not use their credit card online.”
Closer to home, Lynch says that Aussie designers are “punching above their weight when it comes to talent and ideas” and small businesses are certainly reaping the rewards, comprising 70-to-80% of DesignCrowd’s userbase.
As for Lynch himself, he continues to heed the words of mentor Garry Visontay, DesignCrowd’s chairman and lead angel investor.
“The best advice Garry ever gave me was to ask myself every morning when I woke up, ‘how am I going to grow the business today?’. He’s been an invaluable resource on our Board for close to five years, and he’s taught me to have laser focus and to always, always have a plan.”
Writer: Megan Gamble
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