In our continuing series on Irish business success stories, Jerry Kennelly, a school drop-out who went on to sell his stock photo company for $130 million, tells CARL O'BRIENthat anyone can be an entrepreneur – you just need passion
JERRY KENNELLY doesn’t look like a trouble-maker. Dressed in a black pin-stripe suit with an open-necked shirt, he’s breezy and affable. But Kennelly, by his own admission, likes upsetting the status quo.
He thrives on causing confusion and disarray wherever possible. He is, as he says himself, a disruptor, developing technology which is cheaper and easier to use than anything else out there.
That was the key behind his phenomenal success with Stockbyte and Stockdisc – two firms he built from nothing – which went on to dominate the royalty-free stock photography market. He sold them five years ago to media giant Getty Images for around $130 million (€95 million), resulting in a massive windfall for Kennelly and his employees.
And it’s also the key behind his latest venture, Tweak.com, which aims to democratise high-quality design in print by making it affordable to small and medium-sized businesses over the internet. He’s hoping to muscle-in on the $130 billion print business in the US.
“We’re disruptors,” he says. “We’ve created a highly disruptive business in the design sector. Something that might have cost you about $1,000 a year ago will cost you about $100 [now]. What we’re doing will really empower small- and medium-sized businesses around the world.”
The irony of Kennelly’s global success is that it’s one of the most unlikely stories. He left school before completing the Leaving Cert and settled in his native Tralee. He never went on to do a third-level course and had little in the way of money to start out on his own.
Stockbyte’s phenomenal success showed doubters that anyone with the right mix of energy, skill and enthusiasm could develop a world-beating business in small-town Ireland.
Of vital importance were the lessons he learned as teenager in the family business, which taught him about getting the job done, never giving up and, above all, having a passion for your career. They are lessons he holds dear today.
“I’m forever learning and making mistakes,” he says. “Success is really a collection of failures. Over the years, we’ve constantly tried to do our best and redefine ourselves . . . You have to ask yourself: ‘Is this enterprise going to be really good? Might it change the world? Might it change people’s lives?’ That’s the core of what we do.”
ONE MORNING IN THE early 1970s, Jerry Kennelly’s father, Pádraig, came down the stairs and made an announcement that would change his son’s life.
“Lads,” he said to his teenage sons, “we’re going to set up a newspaper.” His father’s printing works had been flooded three times over the previous two years and there was no sign of the council tackling the problem.
Kerry's Eyewas founded in the basement of the Kennelly house to press home the campaign. The four sons were all assigned jobs, ranging from writing stories, taking photographs to delivering the paper to 7,000 homes across Tralee.
The then 14-year-old Jerry devised a community delivery scheme, reducing the number of drops from 7,000 to 400. He also took to the streets on his bike, taking pictures and writing stories, clocking up close to 100 miles a week. Schoolwork took a back seat as he sometimes worked with his parents until 4am to produce a paper.
“Failure wasn’t an option. My parents didn’t see obstacles, so we didn’t see them either. It had to get done. And you just did it, however long it took,” he recalls.
By the eighth issue of Kerry's Eye, Tralee's urban district council had set about building a new culvert. The town hasn't had any serious flooding since.
Kennelly was drawn to photo-journalism in particular. One day, when he heard Travellers had occupied a building site, he went to take some photos, and ended up drenched by a Traveller woman, who threw a bucket of water over him.
“I guess that was my baptism of fire – but it made for a great picture,” he grins.
He left school at the end of fifth year: he had caught the bug and reasoned he could learn more about the world through the paper than in secondary school. He moved on to set up his own photographic news and picture agency in 1981. Hard graft translated into a string of scoops.
Among his proudest is when he unearthed Carlos the Jackal in Kerry, at a time when law-enforcement authorities (and half the world’s media) were on his tail.
“I found him using my network of contacts, and having the trust and respect of people who knew I wouldn’t screw them over,” he says. “I had a pint with him, took his picture, and held off releasing the picture until late afternoon so the scoop wouldn’t be gone. It made the front of 45 newspapers around the world the next day.”
KENNELLY WAS ALSO keen on new technology – he had one of the first Apple Macintosh computers in Ireland – and increasingly began to focus on the relatively lucrative printing business.
The pre-press industry became big business in the early 1990s and Kennelly was designing material for customers on computer and printing it onto film to be used by the printing industry. When new technology began to bypass this process a few years later, he knew the writing was on the wall for the industry.
“We had been a disruptive influence when we started in the early 1990s, and then we got disrupted by new technology by 1995. We could see the business was going to die. That sense of being fully informed about what’s happening, not just in Ireland but globally, was and is vital.”
He immediately started work on a new business plan. The idea behind Stockbyte was simple: create a database of royalty-free stock images based around themes and sell them to publications around the world.
Business began to go off the charts. Stockbyte expanded rapidly from its Tralee base to the point where it was working with partners taking photographs in 70 countries around the world.
“The organisation was running like a spinning top,” says Kennelly. “We went from making $1 million [€700,000] net a year to making $2 million [€1.4 million] net a month.” They made mistakes along the way, which they beat themselves up over, but tried to rectify them as soon as possible.
For instance, there weren’t enough pictures of Hispanics to cater to the rapidly expanding Latino market in the US. As soon as they realised the problem, they remedied it as quickly as possible.
In the midst of the good times, though, there were dark clouds on the horizon. The growth of the internet led to the development of crowd-sourced pictures and new companies were able to deliver stock pictures for a fraction of the cost.
“We had an average transaction of $200 an image. They were licencing them at $1 an image,” Kennelly says. “It put a bomb under the entire thesis of spending millions doing photo shoots . . . it was clear to me the game was over.”
KENNELLY REALISED what Wall Street analysts hadn’t cottoned onto yet – “they were smoking dope”, he says – and organised selling the business. Getty Images bought Stockbyte and Stockdisc for around $130 million dollars. A short time later, the value of Getty fell significantly as analysts belatedly saw that the ground was shifting.
The sale saw the closure of the operation in Tralee and the loss of 28 jobs. It was a bitter-sweet day, Kennelly says, though staff were given a total of €5 million after tax between them, in recognition of their role in the company’s success.
So, did he go and buy a yacht and a high-walled villa, or consider becoming a tax exile? Not a bit of it. He stayed in his home town of Tralee.
“I live in rural Ireland – if you don’t keep your feet on the ground, your feet will be kept on the ground for you,” he says. “I get pleasure and satisfaction out of doing good work, so sitting on the beach sipping cocktails was never going to be an option.”
He has used some of his wealth to implement his vision: making entrepreneurship more respectable and part of the education system. It’s still seen by many as a world of wide-boys and wheeler-dealers.
Kennelly insists it’s a noble calling, and that the mammies of Ireland have a lot to answer for. “They’ve decided that their children are going to be lawyers, architects or accountants, or whatever else. But that’s no guarantee for success anymore,” he says.
“They are great talents to have and I wouldn’t be at all disrespectful towards them. But the reality is working for yourself is a very valid career option.”
He says the Celtic Tiger was a terrible time for entrepreneurship. Ireland, he says, got fat and became obsessed with consumption and went for the quick buck, looking to make money off property investment rather than hard work and good business ideas.
Instead, Kennelly looks to the US as a model for developing and supporting entrepreneurship, especially at third level.
In an effort to foster the same culture here, he has helped to establish a young entrepreneurs programme – which encourages entrepreneurship at second- and third-level education – and the Endeavour programme at the Institute of Technology Tralee.
“What people don’t seem to get is that you don’t have to be incredibly well-educated; I don’t have my Leaving Cert. You don’t have to be part of an inner circle . . . anyone can do it, to a great extent, but that message isn’t being communicated by career guidance teachers.” It’s also a route out of our current circumstances. He says we can’t rely on the Government to create jobs – but it can create the conditions for growth.
“Success in the here-and-now is about people realising they can do it for themselves; forgetting about dependency on the State. Individuals can change an awful lot of things.”
At the end of the day, he says the most important attribute for people considering taking the plunge into working for themselves is passion for what they do.
“It’s primarily a psychological exercise with yourself: Who am I? What can I do? Why am I different? What makes me better than others? Why should other people recognise my talents? Maybe it’s part of our lack of maturity as a nation that sometimes we don’t get that.”
He points to himself as an example that anyone can do it: a school drop-out with no third-level qualifications.
“Listen, I’m the same gobshite I was when I started out,” he grins. “I don’t have any notions about myself. I still get a lot of things wrong and get some things right. If people think I’m a genius, then they’re very, very wrong.”
