Snapshot of the man behind Getty
Jonathan Klein, co-founder of the world’s largest photo distributor, on why his business just keeps growing.
Big shot: Jonathan Klein serves more than 100 countries
Next time you look at a picture in a newspaper, on the web or on an advertising billboard, it is more than likely that it got there courtesy of Jonathan Klein.
The 49-year-old South African is the chief executive of Getty Images, the largest distributor of images in the world. From, its US headquarters it sells more than 20 million a year — notably to the media and advertising. But with these sectors hit hard by the recession, surely even an organisation of Getty’s size — it employs more than 1,700 and serves business customers in over 100 countries — must be suffering?
Although Mr Klein says revenue will be down for 2009, “like every company I know”, overall, he is confident about the group’s long-term prospects.
“Funnily enough, we are doing ok. We have held up our portability pretty well and our revenue declines have been relatively modest,” he says.
“We have put in place the foundations that enable us to continue to grow during the recession. We believe the company has a very strong future and are pretty confident that the business will be growing for several years. We don’t know when the recession will end but we know it will, and we will be in good shape then.”
We don’t know when the recession will end but we will be in good shape
He is clearly looking at the bigger picture. And while the former merchant banker does not deny that Getty has been hurt by the difficulties facing the media — the firm’s advertising-agency and corporate business is down and people do not pay as much for a website picture as they do for it to be printed — he points out that the company is “doing well” in other areas.
Getty sells digital images via its iStockphoto website, an online marketplace for images and videos. Photographers, including amateurs, can earn royalties of between 20 and 40 per cent per photo. The site sells an image every second. “It’s one of the most successful e-commerce businesses — one of the few that has taken a community and turned it into commerce without any advertising revenue.”
Getty also has an exclusive global partnership with Flikr, the world’s largest photo-sharing website, and Getty’s newly launched sports and entertainment editorial business — a rival to Press Association, Reuters and Associated Press — is doing well. Besides, says Mr Klein, “the industry has been though two or three migrations in the past and this is just the latest.
“When we started there was no such thing as digital. Then we figured out how to put a picture on the internet and get paid for it. In 2000/2001, when the dotcom bubble burst, we saw a lot of dollars disappearing. Then, in 2006/7 we began to see classified advertising moving away from newspapers to the web, and more activity on the web, and our business began to slow down. And now, this big recession.”
Mr Klein believes they are “somewhat protected because we are so broadly spread product-wise, geographically and with regard to customers”. Sixty per cent of Getty’s revenue comes from outside the US, their biggest market, and there are plans to expand in Asia and grow iStockphoto outside the UK and US. Developing the editorial business, making pictures more useable and improving the way they produce web pages with pictures are also on the agenda. Mr Klein, it seems, has always taken a long-term approach to business.
He founded Getty 14 years ago with Mark Getty, a fellow banker at Hambros, because they wanted “to build a substantial business in one industry with a very long-term approach.
“I decided to leave the bank and raise some money [£20m] to enable us to do so. We stumbled upon photography. I saw it as a growth area and an industry that technology was about to change fundamentally.
“I saw it as a place where the existing people in the industry would find the changes very scary but we, as outsiders would find opportunity in the changes — a shift from prints and transparencies and analogue to digital distribution.”
Established in the UK, the firm, and Mr Klein, moved to America in 1999 after being reincorporated as a US company.
“It was a very difficult move from a personal perspective, as I had three young children. But it was undoubtedly the right move for the company, and in the long-term, it was also the right move for us personally.”
Listed on the Nasdaq, the company went private in 2008 when it was sold to Hellman & Friedman for $2.4bn — the deal reportedly netted Mr Klein $53m. Mr Getty became a non-executive chairman, while Mr Klein stayed on as chief executive, continuing to run the company in the same way as before.
Has technology not hindered the business, with people now able to take their own photos on mobile phones? “It’s actually helped the business. The iStockphoto community started with people using amateur cameras to take pictures but, as they got better, they upgraded their cameras to get better pictures on to the site. The better the picture, the more you can charge for it, so it has been very positive.”
And Mr Klein, a keen photographer himself, has made some of his own work available for purchase. Two of his pictures, of Andy Roddick at the 2005 Australian Open, are on the Getty Images site.
In the frame
20m+ images sold per year
100 countries served
60 percentage of Getty’s revenue that come from outside the US