Digerati50: Mark Koay is going after the 99%

• 15-year old firm hit revenue close to RM100 mil with 10%-20% y-o-y growth
• Passion alone cannot help you succeed, but won't be able to succeed without passion

Digital News Asia continues its series that profiles 50 influencers who are helping shape Malaysia’s Digital Economy, from Digerati50 2020-2021 (Vol 4), a special biennial print publication released in July 2020. The digital copy can be downloaded from the sidebar link.

The following in an expanded version of the print edition article.

At its core, Photobook Worldwide is a company that sits squarely in the crossroads between traditional and innovative. It is an e-commerce platform in the business of converting digitally taken photos into a traditional product – a photo book – in the age of Facebook, Instagram and digital photo frames.

Yet it’s among the most prolific Malaysian successes. Photobook serves customers across more than 100 countries with offices in six countries, and will likely add Vietnam as their seventh.

The 15-year old tech company achieved a revenue of close to US$23.9 million (RM100 million) for their 2019 financial year, confident that it will exceed that mark in 2020, despite the pandemic dampening consumer demand. Founder Mark Koay who has guided Photobook to an annual revenue growth of between 10% to 20% over the past few years is expecting some acceleration from new markets invested in, plus a boost from new tech-fuelled strategies.

“Photos are part of our memories and lives, and having them in physical form is the best possible way to experience and enjoy them,” he says. His company has helped people print photos across the entire spectrum of life – from the ultrasound scans of their babies to memorial albums.

“In many ways, we play a part of chronicling the most important moments and occasions of our customer’s lives and it’s a keepsake that can be passed on for generations to come – it’s a multi generational product,” he stresses.

There’s magic still in printed photos – a magic which Mark understands. He understood it well enough that back in 2005, he took his savings – earned through building websites for companies – along with borrowed money from his father, to buy a US$335,000 (RM1.4 million) HP Indigo digital printer.

The printer was so huge he moved it into a house he had just bought, placing it squarely in the living room. He converted the top floor into an office for his designers. It is, as he acknowledges, the dictionary picture of a bootstrapped operation.

No stranger to building from scratch

Not a stranger to building things from scratch, Mark had been part of the dotcom revolution, after all. He started Storm Quest in 1998, which built thousands of websites for businesses that ranged from SMEs to government-linked companies such as Permodalan Nasional Bhd and multinational corporations like KFC.

Then there are the various other businesses that he built during that period, including textoad, a premium SMS model dealing in classified advertisements; and ABagofClubs, a golf portal. Nothing truly struck par. In 1999, he sold his business to a Swedish internet consulting company (Icon Medialab). A prescient move. When the dotcom bubble burst in early 2000, Icon Medialab closed its operations the year after and pulled out of the Malaysian market.

Following that, Mark started a web consulting company along with a few former colleagues. But being in a service business wasn’t what Mark wanted. Then, in 2005, revelation struck. He noticed that people were taking a lot of photos using digital cameras, but weren’t printing them. Perhaps it was time to create a more interesting photo product.

That was when the HP Indigo came into the picture. The early days of Photbook, however, saw a lot of experimentation. They didn’t even bind their own books, preferring to utilise the services of a lady in Petaling Jaya, a suburb of Kuala Lumpur, who bound law journals. This was back when orders were fewer. Since then, Photobook has invested more than RM80 million in book binding tech and equipment.

[RM1 = US$0.239]

Mark and his team would participate in any fair you could name – weddings, travel fairs, baby fairs – to get the word out. They’d set up flea market booths. And while orders trickled in, he realised that the Malaysian market was too small. In response, he set up operations in Canada and Australia with the help of family members, and things started taking off.

They localised the websites for each country, making it seem like Photobook were local businesses in each of them. Being a former web consultant certainly helped Mark maximise Photobook’s search engine optimisation. By 2010, the business started having more presence in the US than Malaysia, and would see the next breakthrough by working with Groupon.

Photobook has varying strategies for various regions, though finding focus is a challenge. “Every door / every country is an opportunity and without focus it's easy to get distracted by these opportunities. Plus, some of them end up being rabbit holes which can distract us from where we should be playing,” Mark says.

The Covid-19 pandemic didn’t affect Photobook. Rather, the business grew by over 50%, with some markets doubling. Mark puts it down to people having more time to create their photo books.

“We don't exactly know if ‘new normal’ will mean that our growth will slow but we do believe that the stay home behaviour will persist in the next 12 months and we are definitely continuing to encourage customers to make the books or products they always wanted to!” he says.

[Ed: The article was done in June 2020]

The next big step – mass personalisation

Photobook hasn’t stopped evolving. The company is now turning its attention to Asia, a region which mostly skipped personal computers and moved straight to mobile. They have a mobile app and Mark is working on a machine learning feature to help further automate the photo selection and arrangement process for customers.

The next big step, however, is his original intention of getting into the business of mass personalisation. Photobook is currently in the process of kickstarting Personalise Me (P.Me), and have on-boarded several brands to date with the goal of hitting 50 brands by the end of 2020.

“With P.Me, we will be partnering with 3rd party brands who would like to list their products on our site, we will then enable the personalisation on our site and fulfil the product on their behalf,” Mark notes.

This is all part of future plans to offer more products. Mark acknowledges that the segment they are currently in is relatively niched – perhaps 1% of the total e-commerce market.

“We are going to go after a large part of the ecommerce market. We believe that we can personalise a lot more products, up to 10% of total products in the e-commerce world today. We intend to partner with a lot more brands to make it happen, by marrying our personalisation platform and capabilities with their amazing products.

“We have a few million customers today but when we look at our addressable market, which is SEA, North America, Europe and APAC we have barely scratched the surface, in fact <1% of the addressable consumers are our customers today so we know we have such a long way to go.”

It will seem like Photobook’s journey is still long, but Mark will be doing what they’ve done best: work hard. That’s how they have proved themselves, in the end.

“We’ve bootstrapped since 2005 and been overlooked by investors a couple of times throughout the years. Sometimes it does make you wonder if you’ve really built a strong business because you don't feel like you’ve been ‘validated’ yet,” he reflects.

“Over the years, you learn that true validation does not come from potential investors but from your customers who love your products and continue to support you over the years. While it is true that passion alone cannot help you succeed, you certainly won't be able to succeed without passion.”

Digerati50 2020/2021 is proudly sponsored by Maxis - Powering Malaysia's 5G era.