Why Australia has the Right Mix for Growth — 99Designs

Published on
November 3, 2022
Aly Karindjias
Operations Director
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Since its launch in February 2008, graphic design platform 99designs has grown into a global sensation. Born in Melbourne, Australia out of its parent company SitePoint’s forums section, the bootstrapped and highly profitable 99designs has proven its worth — at a revenue growth rate of about 120% a year.

Humble Beginnings

It all started when SitePoint’s graphic designer members started a friendly competition of “Photoshop tennis” among themselves to create the best design work for fictional proposals. They then place their votes a few days later and declare one winner.

One day, the fictional proposals became actual projects that promise financial rewards for the top designer… and the rest was history.

Profitable at Every Step

Co-founders Matt Mickiewicz and Mark Harbottle took it step by step.

The “Photoshop tennis” competition became so big that they created a separate section for it on SitePoint. Upon seeing how much attention the contest was getting, they started charging a flat fee of $20 to anyone who wanted to post a project.

They then developed basic software and then jacked up the fee further to $29 upon seeing how much traffic it was generating for the site (over three million unique visitors every month).

The traction kept improving and no push-back was seen or heard from the participants. This was their “ah-ha” moment. It proved that 99designs was profitable at every turn and, therefore, deserves its own separate brand and platform.

Why 99designs’ Australian Background was Key to Its Success

Australia’s start-up and scale-up landscapes are filled with go-getters whose tenacity equal those in Silicon Valley. Investment capital firms saw the potential in 99designs and sought to get cosy with Mickiewicz and Harbottle just 16 months after their company launched.

Mickiewicz and Harbottle were reluctant at first, understandably.

99designs was one of the few companies of that time that effectively leveraged the Internet to cost-effectively sell to small businesses. And, at 120% yearly revenue growth, to say that they were self-sufficient was an understatement.

Keeping investors at bay meant that the founders were able to control the company’s trajectory without external interference.

However, seeing how much the company had grown in less than two years, they knew it was time to scale. True to Australians’ appetite for growth and innovation, 99designs caved and, with an injection of new capital, got started on scaling right away.

Three Crucial Steps

Out of all the things 99designs did right, we believe that the following three points were the most crucial to their transition into a global force.

1. They Knew How to Support Their Community

Australia has a history of putting its people first.

It was all fun and games when 99designs members turned a game into something they can profit from. But there were snags that the founders dutifully smoothed over.

99designs faced some backlash from the design community as they were seen as profiting off of designers for speculative work. Yet, it could not have been further from the truth.

Mickiewicz pointed out that before they charged flat fees to participants, the designs were taken right off of the SitePoint platform and used for free — leaving contest winners in the dust without the prize money they were promised.

By charging flat fees, the founders found a way to earn profit while ensuring the design winners were paid what they were owed.

2. They Spotted an Opportunity and Took It One Step Further

It was due to equal parts luck and business savvy that 99designs became what it is today.

The Australian FinTech industry is known to be a force to be reckoned with. This gave 99designs more than enough precedents to look back to and learn from.

By carefully studying other successful start-ups before them, 99designs was able to strategise and ensure that it was profitable from the get-go. Its founders were able to become self-sufficient enough to fund further development and growth, without the initial help of venture capital firms.

3. They Were Strategic in Fine-Tuning Their Business Model

Since 99designs was birthed from SitePoint (a website and publisher of books, courses, and articles for web developers and designers), taking a step toward both design and web development would seem the most natural course of action. However, its founders beg to differ.

By steering focus solely on design, they were able to do one thing only — and do it very well.

According to Mickiewicz, “it keeps our community focused, our employees focused, and it keeps us in touch with our market segment.  If we tried to do many different things all at the same time, we’d have to address the needs of different groups,  market to different communities, and deal with service providers in different categories. It becomes really, really complex, especially  when you are a small business with limited staff, limited resources, and trying to prioritize and execute on growing.”

Much like all the other globally renowned Australian businesses before them, 99designs learned, strategised, and grew into an amazing platform that seeks to solve one problem at a time and solve it exceptionally well.

By providing adequate support to their design community,  taking on opportunities slowly but surely, and strategically fine-tuning their business model, 99designs soared from humble beginnings to the international FinTech stratosphere.

This article is the sixth instalment to our “Why Australia has the Right Mix for Business Growth” series, where we explore the uniquely Australian influences that contributed to the success of 99designs and other global scale-ups like Prospa, AfterPay, Atlassian, Canva, The Iconic, and Sendle.
Tune in next time as we break down how Envirosuite became a global leader in helping industries grow and communities thrive.