Adobe who? Sequoia-backed PicsArt turns photo editing social

From the drawing pencils of babes.

Seven years ago Hovhannes Avoyan was engaged in selling his company, Monitis, a provider of cloud-based network monitoring solutions, when his then 10-year-old daughter, Zara, came to him in tears.

She was upset because she was sharing her art and online bullies were critical of her work. “She always liked to draw, but people on the internet weren’t kind to her,” recalls the Armenia-born Avoyan.

He started toying around with editing tools and uploading photos, and he wanted to make something that was collaborative, too, such as the GitHub community for developers.

Thus was born PicsArt, the San Francisco provider of photo-editing tools and operator of a social community for users.

The company, operating in a sharply competitive field, now has more than 350 employees and more than 100 million monthly active users.

Avoyan says he started growing PicsArt organically, initially in Armenia and the rest of Europe and on Android phones everywhere. Users on the site were creating a lot of content that others in the PicsArt community used and built on.

“We became a platform for creative people to share their capabilities using our tools,” Avoyan says. “It just grew from that.”

Avoyan had not yet raised money for his startup idea, and he had no inkling to do so, much in the same way his previous startups were not VC-backed.

But in 2012, Facebook paid $1 billion to acquire the VC-backed photo-sharing startup Instagram.

And Avoyan recalls that he was drawing interest, and term sheets, from VCs, even though he at the time was based in Armenia, far from the Silicon Valley tech community.

Via his network, about five years ago, he was introduced to Omar Hamoui, a partner at Sequoia Capital and a veteran staffer with and founder of photo startups.

A former senior program manager at Sony Pictures Digital, Hamoui also had worked with the slideshow creator GoPix and founded mobile-to-mobile image-sharing network Fotochatter.

“The photo-app sector is not an easy space to be in,” says Hamoui, who notes that the business model of consumer subscriptions is hard to grow.

Many of PicsArt’s features are available free, and it offers an $8 monthly premium-service package.

But Hamoui says he liked the way PicsArt was leveraging the community and had made the app meaningful by combining social sharing with editing tools on the level of Adobe Photoshop.

Sequoia led PicsArt’s $10 million Series A round in 2015 and the company has since raised $45 million in total funding from Sequoia, DCM Ventures, Insight Venture Partners and others.

PicsArt has expanded to San Francisco and opened an AI lab in Moscow, with an initial five employees, to help generate ideas for the company.

To be clear, PicsArt is far from the only mobile or online editing site.

  • SelfMade provides photo- and video-editing services to help users grow brands online. The New York company has raised $21 million from FirstMark Capital, SV Angel, CrunchFund and others;
  • iMemories of Scottsdale, Arizona, has raised $20 million to help people upload old photos and videos and share them across devices;
  • Chatbooks, Provo, Utah, has raised $21 million to sell photo-book-publishing services, and,
  • Waldo Photos of Austin has developed an AI-powered photo-sharing app and raised $9 million in capital.

In addition, angel-backed Prisma enables phone users to transform their social photos into works of art in such painting styles as impressionism and pop art.

A plethora of other free apps are also available, including Enlight Quickshot, Lens Distortions, and Snapseed, that easily make professional-looking edits on phones.

And the tech-product-discovery service Product Hunt recently lauded the website for how quickly it removes the backgrounds of images, something PicsArt also can do.

Hamoui says PicsArt stands out for its combination of editing with community sharing.

He likens PicsArt to WhatsApp, the Sequoia-backed messaging app that was known worldwide but became a household name in the U.S. only when Facebook in 2014 paid about $19 billion to acquire it.

“PicsArt fills a growing need of editing photos on your phone, and I see 100 million monthly users as only a start,” he says. 

As for Avoyan’s daughter Zara, who helped inspire the app’s creation, she’s now a student at California College of the Arts. And yes, she’s still a PicsArt user.