How 99designs Built A $5+ Million Marketplace In 16 Months. – With Matt Mickiewicz

This is a story of an overnight success that was a few years in the making. 16 months ago, 99designs launched and quickly became a marketplace that facilitated $5 million in design work.

What you’ll see in this interview are the steps the founders took to take it from an idea they discovered in an online forum to a profitable, standalone business. You’ll also see how they demanded that their business prove itself and earn money at every step.

99designs was co-founded by Matt Mickiewicz, who came to Mixergy to teach what he learned over the past 16 months as he built this business.

The FULL program


Video excerpts

About Matt Mickiewicz

Matt Mickiewicz

Matt Mickiewicz is the co-founder of 99designs, which connects clients needing design work such as logo designs, business cards or web sites to a thriving community of 36,749 talented designers. He is also the co-founder of SitePoint, online media company and information provider targeting the Web professional market, specifically Web Developers and Designers.

Excerpts: How 99designs was built

Andrew: Where did the idea for 99designs come from?

Matt: In the SitePoint forums.

So, SitePoint is an online media site for designers and developers and what was happening in the forums was that designers were playing “Photoshop tennis,” essentially holding a competition amongst themselves to see who could do the best design work.  So, on a Friday evening, someone would come up with a fictional project and over the weekend, 20 or 30 designers would compete to create the best design work and on Monday morning, they would vote and annoint one of them as the top designer, if you will.

So, eventually what happens is, some smart bloke came alone and said, “Rather than work on this fictional project, why don’t you build a new logo for my blog and I’ll give $100 to my favorite logo on Monday.”

How did you know this idea would be a hit?

We took it step by step.

First of all, we spun off the design contest as its own separate section of the site from forums, and saw it take off and grow organically in the number of projects posted. Then we decided, “well, if there’s a business in this model, then people should be willing to pay for it,”

So we started charging people $20 flat fee to post a project in our forums. It was very messy, it wasn’t a great interface, it was just vbulletin and that’s it. But people were willing to pay the $20 to post a project because they were seeing value out of it, and the designers continued to participate.

So we took it a step further and created a “contests” tab on SitePoint and built some very, very basic software around the design contests idea, something that was hacked together in a few months time by one or two guys basically. We increased the fee as well, to I think $29, and, because it got more visibility on SitePoint and we have a large amount of traffic on this site, about 3 million unique visitors per month, it continued to gain traction.

We didn’t get any push-back on the price increases, and it continued to grow and grow and grow.

Why did you spin it out into its own site?

Sometime in 2007, it struck us that for this business to really prosper, it needed its own separate brand. SitePoint was known as a resource for developers and designers. It didn’t make a lot of sense to a small business owner, say someone who owns a wine bar or a coffee company or a lawyer or real-estate broker on to come to SitePoint and run a design contest for their logo or their web page design or t-shirt, because the first thing they saw when coming to our homepage was our articles at at tech professionals. It took a leap for them to think that they should click on the “contest” tab and then go post a project to our community.

That’s when we decided that because there was this incongruity with the audience that we were targeting it would make a lot more sense to have a separate brand name. We chose the name “99designs” and launched in February of 2008.

Why did you start charging your users?

If there is a business for it, a certain percentage of the people have to be willing to pay, otherwise it doesn’t justify further investment in time and resources.

At the end of the day, any real business has to make money and by asking people to pay for something, even if it’s really crappy like a forum thread or some hacked together software, it proves that there is a market demand for it.  Because I think this is something that Eric Riese talks about a lot in his startup talks as well. That’s throwing something against the wall — even if it’s very early beta or alpha stage — and seeing if the early adopters are willing to open their wallets, take out their credit cards and make a purchase.

It proves that there is a business model.

Does your community ever feel betrayed because they created something and you jumped in to add a tollbooth?

Actually, it was their idea for the most part.  The designers wanted to prove that the business owners were serious about paying out a winning designer at the end of the process.  One of the early issues that we had in the community when it was was completely free, was simply project abandonment.  Someone would come to the site, they would post their project plus a prize amount, and then at the end of a week or ten days they wouldn’t pick a winner. That was really frustrating to the designers who participated, invested time and effort into it and then saw that nobody got awarded the prize money.

Why do you focus on designs? I’d love to use 99designs to hire developers and writers.

I think it’s really important to become known for one thing, and one thing only. And do that very, very well.

We really want to become known as the place to go to for graphic design and nothing else.  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.

How do you know what to add to your business?

User feedback through UserVoice helps drive a lot of the changes and developments to the site

We also have our developers and the user-interface designers participate in the customer service process.  So, they’re in there one day a week usually, answering tickets, seeing the issues first hand, and then being motivated to resolve those issues for the next release of the software.

Full program includes

• How Matt kept his costs so low that the site was profitable on day one. And how you could use the same techniques.
• A view of how Matt deals with the controversy surrounding his disruptive marketplace. It could help you if your business shakes up a market.
• The inspiring entrepreneurial story behind 99designs, a company many of Mixergy’s past speakers and readers raved about.

Suggested comments

• Have you used 99designs? What’s your experience?
• I’m trying to expand the text excerpts here. Is it helpful to you?
• What points did I miss in either the excerpts or the full interview?
• What did you learn from this interview?
• I paid Mechanical Turk twelve bucks to transcribe this interview and it came out full of errors. Do you think I should post it any way?

Updates:

  1. If you want to a timeline of how this concept grew, check out Matt’s comment below.
  2. Thanks to Patrick’s comment below, I posted the full, raw transcript (but it’s full of typos).
  3. Catone on Hacker News and Dean Collins in the comments below, point out that, while 99designs was a separate company for 16 months, the first contests happened on SitePoint forums around 2002. I changed the first section of this post to clarify that. Thanks Catone & Dean!

Share

  • http://ferric.net adityac

    Pretty good interview (as usual!) — Eric Ries' name is mispelled above, though.

    I usually read the tech excerpts before playing the videos so they're pretty helpful. I think Matt makes a really good point about knowing how well your competition is doing to size the market and understand how to get to the right price point.

  • http://how2livelife.blogspot.com/ NewWorldOrder

    I determine whether I will watch an episode by seeing who is being interviewed & reading the bullets under “Full Program includes”.

    I only read the excerpt if I'm skeptical whether the interview will be interesting/useful.

    I would have liked to hear how Matt built up the initial audience for sitepoint. I'm assuming that the timing of the site's launch helped it out to some degree (pre-dot com bust).

  • http://mixergy.com AndrewWarner

    Shoot. I asked him about that in a previous interview! I should have posted a link to it above.

    Here it is:
    http://mixergy.com/quickly-building-and-se

    The revenue for the site came from selling books that were based on what was on SitePoint. It's an amazing story. Like with 99designs, he took what was happening on his site and found a way to monetize it. And once he did, the revenue helped fuel growth.

  • http://mixergy.com AndrewWarner

    There's some speculation about 99designs's revenues on Hacker News:

    http://news.ycombinator.com/item?id=639805

  • http://www.cognation.net deancollins

    99designs has been around for far longer than 16 months.

    having said that good resource. I've had a number of sites built for me at 99designs including http://www.Cognation.net and http://www.LiveBaseballChat.com

    Cheers,
    Dean

  • http://mixergy.com AndrewWarner

    Thanks. I don't know how I keep getting Eric's name misspelled. I fixed it.

    (BTW, you should have seen how Mechanical Turk mangled Matt's last name. ;-)

    Glad the text excerpts are helpful. I like them too. They take forever to
    do, so I want to make sure they're useful.

    Andrew Warner
    Founder, Mixergy.com

  • http://mixergy.com AndrewWarner

    Thanks. I made the piece clearer thanks to your point! And I linked to your
    site.

    I really appreciate this help Dean.

  • http://www.invitacia.com/ Patrick

    [• I paid Mechanical Turk twelve bucks to transcribe this interview and it came out full of errors. Do you think I should post it any way?]

    Sunk costs. Throw it out there with a warning. BTW Venture Hacks, another great site, will frequently post a interview AND a transcript. For example:

    http://venturehacks.com/articles/closing-quickly

    Why is this better, for me, at least? Cuz I read faster than than I hear, if that makes sense. For me, this is optimal.

    Last Question is: does posting a text transcript attract more visitors to your site via SEO etc etc? And if it does, can it help you monetize your current and future visitors?

  • tp

    Thank you Matt and Andrew!

  • Gary

    Thanks guys for doing this!

  • http://blog.pekpongpaet.com/ Pek Pongpaet

    I wonder how many other potential marketplaces are out there that can spring out of innovations like this.

    Also, as an aside, how much traffic is coming from the transcripts nowadays?

    Keep up the good work Andrew.

  • http://www.citrusbyte.com/ will jessup

    Back in college I used sitepoint forums as the place to go get designs done for cheap. They had the “marketplace” where you could post design competitions and for a few hundred dollars get lots of artwork. I built a site for a friend and he found that I subbed out his design on the site – but he was happy that I had a process for finding so many designers as well!

    99designs was a great idea to spin out a very popular part of an already working idea.

  • http://www.n4g.com/ Vegard Aure

    Great interview! We recently had a very successful logo contest at 99designs for our next project. It is often just as important to find out what doesn't work as much as finding out what does. Design contests can be very helpful with that.

  • http://99designs.com/ Matt Mickiewicz

    If anyone is interested, you can look through archive.org and see the Photoshop Tennis/Graphic Wars happening in the SitePoint Forums in 2003 & 2004:

    http://web.archive.org/web/20040608002044/www.sitepoint.com/forums/forumdisplay.php?f=93

    Around 2005 the idea of getting logo design for real projects began and we created a “Contests” subforum to contain that activity and tacked on a $9.95 listing fee a few
    months afterwards:
    http://web.archive.org/web/20051001055150/www.sitepoint.com/forums/
    http://www.sitepoint.com/forums/showthread.php?t=292992

    Once we saw revenue & listing growth momentum, in August 2006, we decided that vBulletin wasn’t good enough and that we wanted to launch some basic software around the idea of “Design Contests”: http://www.sitepoint.com/forums/showthread.php?t=412887

    Two months later, on October 29th 2006, we launched the new software & interface and increased the listing fee from $9.95 to $20:
    http://www.sitepoint.com/forums/showthread.php?t=433694
    http://www.sitepoint.com/forums/attachment.php?attachmentid=38379&d=1155536923

    that obviously led to the launch of 99designs in Feb of 2008. It’s lots of fun looking back at how everything came together.

  • http://tkstohlman.com/ TK Stohlman

    Andrew – keep you the great work! Love your interviews. You are doing a great job!

  • http://mixergy.com AndrewWarner

    Thanks to your suggestion Patrick, I added the full transcript. I'll
    probably do that more often. Here's the link:
    http://mixergy.com/99designs-interview-wit

    To answer your question, I don't monetize my site in any way.

  • http://mixergy.com AndrewWarner

    You bet. Let me know who else you think I should interview Gary!

  • http://mixergy.com AndrewWarner

    Thanks TP! Glad you enjoyed it.

  • http://mixergy.com AndrewWarner

    I don't seem to get a significant amount of traffic from Google.

    Search engines account for 6.55% of my traffic.

  • http://mixergy.com AndrewWarner

    I like browsing other people's designs to help me figure out how to describe
    what I'm looking for. It's a great service.

  • http://mixergy.com AndrewWarner

    Looks like a lot of their forum conversations can be spun off into their own
    sites.

    I hear they have plans to launch another site soon. Similar to 99designs in
    that it originated in the forums too.

    Thanks for the comment Will. And for the story!

  • http://mixergy.com AndrewWarner

    This is very interesting. Through these links I can see the business unfold.
    Thanks. I'll point to it up in the post.

    And thanks again for doing this interview.

  • http://mixergy.com AndrewWarner

    I love doing these interviews TK! Glad you enjoy hearing/watching/reading
    them.

  • momob

    Thanks Andrew.

    I just love this guy! Matt has compelling value proposition and he know how to always present is such logic way! 99Designs is such a great concept. I will definitely use it when I start my startup! Also, Matt is right, 99Designs is a great name. I can imagine 99Names (product naming site), 99YourNameIt… I really like the fact that the customer get to see multiple designs and choose the one he/she like instead of hiring ONE designer and pray that it would work out. That's what I call the future!

    Mo.

  • http://www.josemariagil.tv/english Jose Maria

    Great interview Andrew! Matt is a really smart guy, with a clear vision on how to grow his business, launching products for the huge audience he’s built with SitePoint. I have yet too much to learn…

  • http://99designs.com/ Matt Mickiewicz

    Thanks for the kind words Jose! Much appreciated.

  • JasonJennings

    I love 99designs. Besides having my start ups logos and business cards designed there:

    http://www.clevertools.com/temp/Clever_Technolo
    http://www.clevertools.com/temp/clevertools_BCf
    http://www.clevertools.com/temp/clever_tools.jpg

    I probably had one of the most memorable 99Design contests- a contest for a graphic that was converted to a blanket used in the proposal to marry my then girlfriend now wife;) This is what it turned out to look like: http://www.solvetechnology.com/temp/jillb.jpg. That was waiting for her on a beach in Kauai with a picnic… definitely a fond moment for me and made to happen thanks to 99designs!

  • Sean Lynch

    Andrew- any thoughts on writing the questions below the video box on “video excerpts”? I think that would be great. Also would be great to get a few standard questions and answers for all interviews and run video on those questions. (ie. words of advise for entrepenuers? Is there someone in the business world you would like to meet and why? etc. and then one segment from the interview. Just some thoughts. ATB

  • christi32

    I agree with Matt. Sometimes charging money does add value to a service or product. When you invest money into something (purchase a service online), you are less likely to treat it less than with your full attention. The people on 99 designs who would ask for a design from the competing designes, but leave their responsibility of awarding the prize money, after the designers worked hard to compete…were doing it because they had nothing to lose. When you have something to lose, like money, then you are less likely to do things willy-nilly. Plus, the whole psychology of it is, if there is a price attached to something, then sometimes the mind is turned on to it. For instance, If I give away free tickets to an event to everyone, I may get a lot of people, maybe a lot of people who do not really value the event but are just there to bum around. But, if I charge a price to it, maybe $15, then I will get people who are coming just for that event….they are on a mission to attend and enjoy that particular event most likely..so you may not get so many rif-rafs (those who are just there to bother the patrons and disrespect the event) who may cause trouble. Plus, sometimes attaching price/monetary value to something, like an event, is also a way to attach “status” to it.

    I remember paying $200 for a Cinco De Mayo gala in 2007, which took place in Arizona. I was not planning to go to Phoenix, but when I was reading about that event online, what the event offered, and seeing the $200 price, I thought……”Oohhhhhh this is where the 'in crowd” , the “movers and shakers” are going to be”. Plus this event would have such entertainment as fire dancers, belly dancers, flamenco dancers, brazilian and salsa music. It also had gourmet food. I was persuaded to make a full vacation trip out of it.

    The $200 spoke to the value that the event would give. Buying that ticket meant, or equaled to, breaking into a certain crowd of people that may lead to business relations that could benefit me. I did meet quite a few influential people, especially since the gala was using the ticket money to help support youth arts education. So, this raised the “movers and shakers” identity even more.

    Don't be afraid of adding financial value to your product. But, make your product something that will create a special benefit to your customer.

  • JasonJennings

    “Don't be afraid of adding financial value to your product. But, make your product something that will create a special benefit to your customer.”

    Very well said!

  • christi32

    Thank you Jason!

  • http://www.josemariagil.tv/english Jose Maria

    Thank you Matt for sharing this information with Andrew and teaching guys like me, who are just starting a business, very valuable lessons.

  • http://mixergy.com AndrewWarner

    I like your suggestions.

    - For the video excerpts, I'll see if I can put the questions in the
    YouTube titles.

    - I'm trying to come up with a consistent question to ask. I think
    something about an action that people should take might be good. I'm
    testing different questions to see what produces the most meaningful
    answer.

  • http://mixergy.com AndrewWarner

    It's encouraging to see that people pay online and that it's not all
    about free.

  • http://mixergy.com AndrewWarner

    It's encouraging to see that people pay online and that it's not all
    about free.

  • http://www.manyniches.com/ Brandon Watson

    I thought that this was a great episode. The audio was a little tough to follow at times, but I guess that's what you get with VoIP.

    One thing that I really, really liked about the interview was the frank discussion about the notion of building a community on the backs of contributors and then trying to profit from it. It's definitely a worry of anyone who is trying to build a community, and great to hear someone talk so openly about it.

    Another great takeaway was that 99Designs employs people whose job is to watch the contests, and the go back to the losers with concrete information about what they could have done better to win the contest. What a great take on customer service. By default, 99% of the participants in a contest are going to walk away unhappy (since they didn't win) and by giving them something of value, 99Designs is creating good will, and giving them actionable information for how to increase the likelihood that they walk away from a future contest happy.

  • Pingback: Flippa Launches Beta After Success of 99Designs

  • http://www.petermcclean.com/ Peter McClean

    WOW – you are all SO ignorant!! Without a proper judging panel, proper contest rules, nor proper “alternate means of entry”, which EVERY real contest must have in order to even be LEGAL in this country, these “contests” are not really contests at all, merely underhanded attempts to rip off naive artists.

    Although 99Designs is an Australian-based company, they are hosted right here in the US, and they are also conducting business right here in the US, therefore they MUST comply with US laws. Allow me to elaborate on this, and also to educate you in some basics of copyright law in the USA…

    What 99Designs is doing is not only illegal in the USA, it is highly unethical as well. First of all, they state that, “After the prize is paid in full, the ownership lies with the contest holder which is royalty-free and irrevocable.”, which is absolutely LUDICROUS!!! There are ONLY nine categories (as enumerated clearly in copyright law) by which works can even be considered eligible to be work-for-hire. These “contests” (and again, I say this loosely, since they do not have a proper judging panel, proper contest rules, nor proper “alternate means of entry”, which EVERY real contest must have in order to even be LEGAL in this country) fall into NONE of these nine categories, so what this company is REALLY doing here is ripping off young designers fresh out of school who are too green to know their rights. They are simply skirting both labor and copyright laws, and attempting to steal intellectual property from others.

    Slavery was outlawed in this country long ago. Let me elaborate… even IF these people were on-site employees of 99Designs, 99Designs would not get any rights to their works if they were not at least paying them the federally established minimum hourly wage, right? RIGHT. So why on earth, when these artists are NOT employees of 99Designs, and they are NOT being fairly paid, would 99Designs possibly think for a moment that they could own (or transfer the right to own) these artists' works?

    If someone is not your employee, and they perform work off-site, on their own equipment, on their own software, paying for their own electricity, receiving no benefits of any kind whatsoever from your company, and said work results in the creation of intellectual properties, then for those properties to even be ELIGIBLE to be considered work-for-hire they MUST fall into one of the following NINE (and ONLY nine) categories, as enumerated clearly in copyright law.
    ——————————————————————————–
    1) A contribution to a collective work (such as a magazine, newspaper, encyclopedia, or anthology).

    2) A contribution used as part of a motion picture or other audiovisual work.

    3) A supplementary work, which includes pictorial illustrations, maps, and charts, done to supplement a work done by another author.

    4) A compilation (new arrangement of pre-existing works).

    5) A translation.

    6) An atlas.

    7) A test.

    8) Answer material for a test.

    9) An instructional text (defined as a literary, pictorial, or graphic work prepared for publication and with the purpose of use in systematic instructional activities).
    ——————————————————————————–
    Works that fall outside of these nine categories (like LOGO DESIGNS!!) are CLEARLY ineligible to be work for hire, even with a signed contract. Just because 99Designs has tricked some artists into signing away their rights doesn't mean that it's legal to do so, or that their contracts are binding. 99Designs needs to realize that you can not bend and interpret the law to suit your needs. Law is law, and any wrongdoing WILL catch up with you eventually. (think Napster, The Pirate Bay, Jack Kevorkian, etc…)

    A contract by very definition MUST be inure to the benefit of BOTH parties. Otherwise, by law, it MUST be construed as a waiver.

    Also, if you will read through the blog postings for 99Designs, which can be accessed right from their website, many artists who have fallen for their scam never even receive the measly well-under-market-value pittance amounts that they were promised after the close of one of these “contests”. I have read postings from several artists who have already been waiting well over six months to be paid for their works. This is completely unacceptable, not to mention illegal.
    ——————————————————————————–
    ARTISTS!!! DO NOT EVER SIGN WORK FOR HIRE AGREEMENTS!! WE HAVE FOUGHT LONG AND HARD FOR THE RIGHTS THAT WE HAVE!! DO NOT LET THESE TRICKSTERS DECEIVE YOU!! YOUR WORK HAS WORTH!! IF YOU HAVE BEEN RIPPED OFF OR TRICKED, JOIN A UNION THAT WILL FIGHT FOR YOUR LEGAL RIGHTS, THEN FILE A GRIEVANCE!! SEEK BACK DAMAGES FOR THE USAGE OF WORK THAT IS RIGHTFULLY YOURS!!! JOIN THE GRAPHIC ARTISTS GUILD TODAY!! (http://WWW.GAG.ORG)

  • Matt

    Profitable from day one. Wow.

    And as with any good market where there is money, there is competition springing up. Which is good for clients and designers both.

    One good one that just opened and is trying some new things (although the name isn't that creative) is DesignersContest.com. They added something like a Designers Pool that they'll give away every month, and have said they have a few more things in the works.

  • Kapil

    99 Designs is completely unprofessional in their approach towards their customers. I registered for a contest on their site & wrote back later for some support question, its been 24 hours since that and I have got no response.

    I will suggest caution before doing any business with them.

  • http://99designs.com jaiken

    Hi Kapil,

    What is your username…I will look into it.

    Email me at Jason (at) 99designs (dot) com

    Jason Aiken
    99designs

  • http://mixergy.com AndrewWarner

    I know what you mean about the audio. Sometimes I wonder if I should just go
    back to phone interviews and forget the video. But there's something about
    seeing people that makes the interaction feel more real.

    I've also fantasized about sending out clean computers with nothing but
    Skype on them to everyone I interview. But I tested the idea a bit and it
    didn't make sense.

    I didn't realize he said that they contact people who didn't win to see what
    they could have done better. Great idea.

  • http://mixergy.com AndrewWarner

    Kapil, I've heard lots of great feedback on this company from people I
    interviewed on Mixergy. If you're having trouble, I'm sure its not typical.

  • http://mixergy.com AndrewWarner

    disqus lost my comments when I moved from blog.mixergy.com to just plain old Mixergy.com. They'll be back. There was a good discussion here and I don't want to lose it.

  • http://mixergy.com AndrewWarner

    Peter, I want to give you room here to offer a counterpoint to what's been
    said here, but this comment isn't the kind of tone I want for my site.

    If you post this comment on your site, I'll personally link to it from the
    comments, but I can't leave it on Mixergy.

    Does that sound fair?

  • http://mixergy.com AndrewWarner

    Hi Andrew,

    Yea I do understand it could be a one off thing. I have been frustrated with them for the past day, trying to get some UI done for a very exciting weekend project. But I think posting on mixergy helped, I got a response from them…finally & they have been good.

    Thanks for the note below, I will touch base with Jason.

    BTW, love your start-up, regular visitor on your site. Hopefully someday you can do a writeup on the project I am working on, once it gains some mass :)

    - Kapil

    ________________________________

  • Brian

    Andrew, you just interviewed a guy who's been the #1 most successful entrepreneur to build a money making machine out of spec work – the most controversial topic in the web dev community right now. You should expect comments like Peter's. It would be unfair of you to remove it. He's clearly passionate about the topic and A LOT of people (including myself) feel the same way he does about it.

  • http://www.petermcclean.com/ Peter McClean

    No, it quite honestly sounds like you have been bought and paid for. Look, I know the truth hurts, but a journalist such as yourself should really know better than to peddle this kind of garbage to the masses. I have said nothing wrong. This company is violating the law, and you are promoting them. It is truly a sad state of affairs. Also, you must be aware that this is a completely unrealistic and unsustainable business model/platform, destined to fail sooner or later.

    Yes, I am clearly upset, but please realize that I have every right to be, and I really have said nothing wrong. No cursing. No nothing. Whatever happened to the notion of free speech? I only expressed my personal opinions, which just happen to be firmly rooted in law and fact.

  • http://www.petermcclean.com/ Peter McClean

    Thx, Brian!

  • http://www.stephenbaugh.com Stephen Baugh

    Wow … great interview. Pleased to have found your site. Well done

    Thank you

  • Pingback: Business News » Blog Archive » How 99designs Built A $5+ Million Marketplace In 16 Months. – With …

  • http://www.businesstribes.com/ Joseph Joel Sherman

    Thank you. I appreciate seeing the business grew by charging a small fee for each contest. It does not seem like rocket science, but he did it well and had a good team. I looked at the 99design website, it seems very simple to use.

  • Pingback: Anyone Who Watched Matt On Mixergy Shouldn’t Be Surprised That He Launched Flippa. — Mixergy.com

  • http://www.jermainelovepoems.com/ Love Poems & Love Quotes

    That's a nice overview on the video Andrew. This only proves that providing a service for designers pays off big time, especially if in its in demand. The designing business is BIG!

    Regards,
    Jermaine

  • angrydesigner

    I don't know why no one realizes how harmful this is to the graphic design community. We designers have gone to school to learn how to be the best that we can be and learn all the skills needed to design great work. Graphic design has been reduced in the public eye to be no more than simple use of photoshop filters and bad line drawings. If I remember correctly one of the founders of this 99designs was an architect. How would he like to start a company that rips off architects? He should know how much work goes into designs! Graphic designers come on to this site, put in hard work and LOTS of time and only one person gets paid in the end. How is that right?

    In an above comment someone said: “I really like the fact that the customer get to see multiple designs and choose the one he/she like instead of hiring ONE designer and pray that it would work out. That's what I call the future!”

    NO! We cannot let that future happen! Dont you see how unfair that is? You are essentially hiring each of those graphic designers (because they are creating work for you and putting in hours for your company) but only ONE of them gets paid!!! Any designer who participates in 99designs: you are only hurting the design community and yourself! Do not create precious designs you don't get paid for! It is unethical! And for companies and businesses participating: you are only fueling this new future of design, which yes, is cheaper, but is also highly unfair to the designers! Think about what you are doing! It is illegal! You are hiring multiple people but only paying ONE!

  • http://ChuckBrown.com/ Chuck

    Probably the best interview I've seen here yet! I'm sending the link to a friend now…

  • http://www.accidentsdirect.com/medical-negligence.aspx negligence claims

    Medical negligence claims (also known as clinical negligence claims) can vary from wrong prescriptions, a delay in diagnosis which resulted in an injury, misdiagnosis of an illness or disease, surgical errors during an operation, or neglect and injuries during childbirth, for a mother or baby.

  • http://www.accidentsdirect.com/professional-negligence-claims.aspx professional negligence

    Have you been the victim of a professional advisors mistake, mishandling or mismanagement? Do you feel your case should have been handled better? Are you now paying the cost for this poor service? If your answer to any of these questions is yes, then you may well have a professional negligence claim!

  • groupsource

    medical negligence is the all the more common misdiagnoses which for litigation purposes can be subcategorised into non-diagnosis and incorrect diagnoses. If a person suffers as a result of misdiagnoses then this is very much categorised as medical negligence.

    http://oopslaw.changjy.com/2009/10/07/an-overvi

  • willbo

    Great interview. Matt is obviously a very smart guy – I love the approach of going straight for the revenue. Introducing paid services AFTER your user base is established and has been using a free product for years is waaay harder than charging from the very beginning. Good on you Matt :)

  • willbo

    Does this also mean that RentACoder, eLance et al are all breaking the law too? If so, why haven't they been shut down yet?

  • http://www.shopfordesigns.com/ Steven Lee

    Would like to tell you that i

    have profile on another website. shopfordesigns.com

    There I have a nice profile with many wins. You can

    consider that site.

    ShopForDesigns does NOT charge any listing fees and

    has lots of talented designers too. You can get good

    designs at half the cost you are spending here.

    shopfordesigns.com has the same operational model as

    this.

    Since the site is new it has less number of projects

    so all designers will concentrate on your project.
    So you can try it…

  • jonchui

    Does this also mean that companies like AdHack (http://www.adhack.com) are also illegal? Basically, they do the same thing 99designs does, but connects ad creators with ad buyers. Cause honestly, when I first heard their idea I was quite excited and thought “what a great idea!” – I also met the founder, James Sherret, who has a track record of great startups. I don't think he would have done this if he had known it was illegal. Then again, the company is based in Canada… interesting.

  • marhamat

    I love it when the market speaks and people who are already doing what they love listen to the market. With the internet these stories are occurring more and more. It's a great to see creative thinking. Some may call it opportunism, but that's okay because it gets the job done.

  • http://medicalbillingbooks.tripod.com/medical-billing-training-courses.html Medical BIlling Mastermind

    Matt, I want to thank you for going the extra mile by giving us the links so even a newbie to this community can clearly understand the in's and out's of the business.

    Paul

  • 99hates

    99 designs is the worst site ive seen, Why? It promotes eliminating designers and spec work is not right, you are destroying hundreds of businesses by doing this and if businesses fail, then people lose jobs, if people lose jobs then the economy suffers, if the economy suffers then you could end up going out of business your self 99designs!

    This is not smart, sure you may think it is cool now but look back 10 years from now, will you be proud or disapointed of the move you made?

    This website needs to get off the web and in the trash. I dont recommend any ethical or wise person to do this, only idiotic people who rather get more for less which is not the best thing as you can see with what is happening now.

    Think smart, buy smart, smart is not always about what you save but how it impacts you in the future!

  • 99hates

    99 designs sucks

  • 99hates

    99designs is full of shotty designers

  • davidbaer

    Affiliate Marketing is a performance based sales technique used by companies to expand their reach into the internet at low costs. This commission based program allows affiliate marketers to place ads on their websites or other advertising efforts such as email distribution in exchange for payment of a small commission when a sale results.

    http://www.onlineuniversalwork.com

  • http://www.aaronwulf.com/ Aaron Wulf

    Reading the comments below, I can understand why some people feel as strongly as they do about this. As Matt said in the interview, 99 Designs was/is destructive to the normal design process. But as someone who has been ripped off by designers in the past, I'm extremely pleased that the consumer now has some protection with sites such as his and Elance.com. Errors and bad work are bound to happen, but the cost-ratio is one-tenth the price when mistakes are made with overseas designers/programmers.

    I've often wondered how some of these companies hit the ground running from day one. Matt confirmed that they tested it on SitePoint before for quite a while, and only when it was ready and had enough momentum behind it did they move it to its own site. Makes sense. I'd think anyone else who doesn't take this approach would be bound to fail. Momentum is everything. Good tip to learn.

    I'm surprised though that they launched the site “ugly”, as he said, and then improved it based on feedback; this goes along with – yet contradicts – what I've heard from many people. So often you only have one chance to make a first impression, and with a product business, in general, if things are a mess to start with, you may very well have lost that customer for good. I suppose with a service industry it's the work that matters, but I am still curious about this.

    Great interview!

  • Mark Emst

    First time I saw 99designs around I felt inspired and thought what a good idea (I am an designer)
    Now the world can compete and even in far away poor countries designers can get a chance to get in contact with real businesses of the stronger economic side of town.

    Phase one:
    I gave it a couple of shots in my spare time for fun – did not win anything… no problem there…still smiling…

    Phase two:
    During the lookout for more competitions, I ran through a whole lot and suddenly it struck me (I might be slow) – this IS competition but it is in a sense like the old Roman way; there will be a prize but only for the survivor. smile stiffening…

    Phase three:
    99designs is seriously harming designers; and I can take it – but what about a designer on the poor side? can he afford loosing his valuable time again and again on rejections / corrections / suggestions from contest holders on 99designs that in many case do not even understand about design but merely goes for prettiness. Especially when the designer risk getting dumped in the final round. Loosing his time; what you know? that might be the day he did not bring food home to the family and did not do that other low paid local job but he bought into the seller of hope.

    Phase four:
    They might not know it (see it) but 99designs is seriously using the designers hope of fame/work/food to get rich and their own business running – That is clever, that is capitalistic, that is in my world unethical.

    I myself are in the area of outsourcing and could have been using 99designs, but never did we get people to do free work for us and then asked them to leave without pay. The day I would use 99designs is the day they change their business method (and it will cost them – yep! hard to be ethical)
    - they need to re-think their setup. (what about designers with portfolio, get invited by contest holders (based on their portfolio quality) who then have to paid 2-4 hours on each designer they invite per round and a final bonus for the winner). A pay of a minimum of that originate country was the least 99designs could do. But I guess the customers of 99designs are not willing to pay more now they got used to 295$ for a million earning size company logo eg. 99designs.com/contests/37129

    Exploit is a fast way to get rich but I guess it do not taste so good in the end – and someone did not get any food today because he was “stupid” enough to waste his time in the arena.

  • Bobby

    Andrew,

    I just joined mixergy today, and a huge reason was to watch this video. One bit of information that I was hoping to find was how much it cost to develop the site 99 Designs. Matt talked about how he raised the money, but did not mention how much it was. I would love to know what the investment was to build the initial site.

    Thanks so much! Great video :)

    Bobby

  • 99designer

    99designs- the best website, idea, project,business , profession , job EVER!

    i m really happy that it exists!

    one of the 99 designs designers.

  • http://mixergy.com Andrew Warner

    Thanks!

  • Johnny

    99designs is a beautiful concept. Creates a new market for designers that otherwise would have never been paid AND/OR rewarded.

    There's no gun forcing a designer to “work-for-free”. They do it out of their own free will. The reward isn't just money. They get fun practice taking on projects and designs that inspire them as they develop their skills alongside other establishing designers.

    There are people WILLING to pay a small amount and people WILLING to accept that small amount. In the end, clients will learn more about design and appreciate good design and designers will have gotten great experience in the real world. The relationship is relaxed-commitment, fun, and challenging. 99designs is only another new-age medium of bringing sellers & buyers together based on a compromise on price.

  • http://mixergy.com Andrew Warner

    You should see the appreciative email I got from the new designer who I
    hired through 99designs.

    I would keep working with him.

  • http://mixergy.com Andrew Warner

    You should see the appreciative email I got from the new designer who I
    hired through 99designs.

    I would keep working with him.

  • Pingback: Few questions - DesignersTalk

  • Pingback: How to Get the Best Logo Design

  • Pingback: Send favorite bootstrapper | jesus4us WordPress

  • Pingback: The best interviews with bootstrappers, Uber’s hurricane difficulties and more | 21times