Why every photo storage startup dies or gets acquired
J Thoendell stashed this in Apps
n November 2013, when the photo storage service Everpix went down, the CEO of rival Picturelife offered assurances to his company’s customers. "We have lots of cash and ramping revenue," Picturelife CEO Nate Westheimer said in a tweet. "All signs say we will last :D Would love you have your business!" But just a few months later, Westheimer acknowledged the difficult economics of storage-based businesses. Like Everpix, Picturelife’s millions of photos were stored on Amazon Web Services servers — and its costs were growing quickly. "Picturelife, a relatively nascent company, will pay Amazon over $1 million just this year," Westheimer wrote. "The way I see it, it’s a million dollars standing in the way of thriving and sending them even more money in the future."
Westheimer’s post was prescient. On Thursday, he sold Picturelife to digital media hub Streamnation for an undisclosed sum. All but two of the company’s eight employees, Westheimer included, will leave the company. And while Picturelife will continue to operate, its failure to remain independent is telling: it may be simply impossible to build a standalone billion-dollar business based around storing people’s photos. "This isn’t a product like Snapchat; it doesn’t take off overnight," Westheimer told me. "So you need that financial durability in the early years, while you’re still building your customer base."