A profitable Malaysian startup is taking on Adobe and Canva

In 2017, Tech in Asia profiled Inmagine Group, the bootstrapped and profitable Malaysian company behind popular stock content service 123RF. Three years later, the company has transformed itself into a software-as-a-service (SaaS) player with a suite of creative platforms and a proprietary AI engine.

Photo credit: Inmagine Group.

In 2018, Inmagine Group acquired online image editing suite Pixlr and launched Designs.ai – an AI-powered platform for creating videos, mock-ups, designs, and logos – in the following year.

Both are SaaS products that are powered by Inmagine Brain, the company’s AI engine that will soon be offered as a service to other companies.

Before that, the group also bought online graphics editor Vectr, design marketplace TheHungryJPEG, and filmmaker community platform Story and Heart in 2017. It is now building an alternative to Adobe Illustrator too.

Warren Leow of Inmagine Group / Photo credit: Warren Leow

With these tools, Inmagine Group hopes to capture a slice of the US$31 billion creative cloud market—a space dominated by Adobe.

Despite this acquisition spree, it remains profitable. But can it stay sustainable while chasing lofty goals?

From content library to SaaS play

Inmagine Group is gunning for massive growth, and expanding from stock content to creative tools is a large part of that plan. The stock content industry’s total addressable market (TAM) is around US$6 billion, says Inmagine Group co-founder and CEO Stephanie Sitt.

Meanwhile, the creative cloud industry’s TAM is 5x more, standing at over US$30 billion. Through its SaaS play, Inmagine aspires to capture 2% to 3% of this sprawling market.

“The thing about SaaS is this: It’s all about the product,” says Sitt. And when you get the product-market fit and value proposition of a SaaS product right, you can potentially grow into a multibillion-dollar business over time, she adds.

The success of the business model is also about vertical integration: “We already have the community, we have the traffic, we have the content,” explains Warren Leow, CEO of Designs.ai and vice president of strategic partnerships and revenue at Inmagine. The next step, he says, is to knit everything into one ecosystem. “Subsequently, once [customers] create using our tools, how do we sell the content within our marketplaces again so it becomes like a virtuous cycle?”

Inmagine won’t be the first to create this feedback loop. Canva, the popular US$6 billion Australian design platform, acquired stock content sites Pexels and Pixabay in 2019. Content from these sites can now be searched and used within Canva.

Carving out a niche in the market

Creative AI-as-a-service?

Time to take more risk