Scene7
Encyclopedia
Scene7 is an American on-demand rich media software company that provides document hosting
and interactive publishing
services such as online catalogs, targeted email
, video, and image management. Several companies, mostly retailers, use the company's services to showcase products on their websites and to allow customers to interact with the products. Scene7's technology allows users to manipulate product images by zooming in and rotating products, simulating the inspection of merchandise in retail stores.
The company, founded as a division of Autodesk
, created a room decoration computer software called Picture This Home in the mid-1990s. The division was sold to Broderbund in 1998, then spun off as a company called GoodHome.com in June 1999, receiving $30 million in venture capital
. After GoodHome.com failed to become profitable, it was reorganized and renamed Scene7. It formally launched on January 23, 2001 and focused on helping companies prepare interactive advertisements for consumers. Scene7 was acquired by Adobe Systems
on May 31, 2007 for an undisclosed sum.
, Scene7 provides document hosting and interactive publishing services, typically charging clients $30,000 to $50,000 a year to convert catalog print files to interactive web pages. The company does most of its business in North America. Its primary competitors for dynamic imaging services and technology are RichFX and LiquidPixels. Scene7 products rely on several Adobe products, including Adobe Photoshop
, Adobe InDesign
, Adobe Flash
, Adobe Illustrator
, and Adobe Flex
; this relationship existed before Adobe purchased the company. Scene7 does not maintain any servers to host its services; instead, it uses a "pay as you grow" program that only requires it to pay for the resources that it uses.
Scene7's clients include the companies Sears, Lands' End
, Harrods
, Macy's
, Office Depot
, Levi Strauss & Co.
, La-Z-Boy
, and QVC
. In 2001, Scene7 agreed to develop home design and landscaping software for Individual Software for $50 million. High-end casual clothing retailer Anthropologie
has used Scene7's services to create and deploy online catalogs for its e-commerce website since November 9, 2004. The retailer implemented Scene7's Dynamic Imaging service to let customers zoom in on products, similar to how merchandise is inspected in retail stores. The Harrods
department store signed an agreement with Scene7 on June 24, 2005 to use Scene7's imaging and catalog system on the store's website. This required Harrods to convert all its printed material to a digital format for Internet use.
On October 20, 2005, web agency Logan Tod announced that it had partnered with Scene7 to offer new features on its e-commerce websites. These include Scene7's Dynamic Imaging service, which allows visitors to zoom in on products to see details; this feature, Logan Tod claimed, helps to drive purchase decisions. Fathead
, a company that builds and sells wall graphics, uses Scene7's services on its website to generate images and to allow visitors dynamically layer images on top of each other. National Business Furniture, a furniture retailer based in Milwaukee
, Wisconsin
, implemented Scene7's technology on November 3, 2008, allowing visitors to dynamically change the colors of product images on the company's website.
The company began as a development team that created software called Picture This Home in the mid-1990s for Autodesk
in San Rafael
, California
. The program allowed people to virtually preview room decoration projects before any work began. Its users can create virtual rooms, change walls and arrange furniture, and create photo-realistic renderings of completed designs. Picture This Home was awarded the Good Housekeeping
Seal of Approval. In 1998, the software and its team of 40 developers were sold to Broderbund, which was owned by The Learning Company
, a subsidiary of Mattel Inc. Broderbund eventually spun Picture This Home off as a company called GoodHome.com in June 1999 with Doug Mack as its CEO. The company received $30 million in venture capital from Hearst Interactive Media
.
Mack noted that before Broderbund spun off GoodHome.com as a separate company, there was a "big culture clash" between the established company and the new media
division. He said that companies such as Broderbund were so concerned with established business that smaller, newer divisions found it hard to receive sufficient attention and bandwidth
. He praised Broderbund's decision to spin the company off as a separate entity: "We would have never been able to build our Web business if we were not in a separate building with separate funding." Mack observed that newer companies like GoodHome.com rarely had any problem in hiring new employees because of the opportunity for Internet companies to grow quickly into "the next Amazon.com
".
In September 1999, GoodHome.com merged with Alexandria
, Virginia
-based nHabit.com, a rival company, for an undisclosed sum. After the merger, GoodHome.com was assured that it would grow quickly; the merger also added the Internet service provider
America Online to GoodHome.com's portfolio as a client. Ten weeks after forming a business plan, GoodHome.com officially launched on September 29, 1999 with offices in San Rafael and New York City, New York, and Roger Horchow
was assigned as its chairman. The company used the slogan "A beautiful home. It was never this easy," and focused on selling furniture and other home items, spending $20 million on advertisements in its first year. Mack decided that the company should target women, since "women make 80 percent of decorating decisions." The company built a home furnishings portal to compete with the websites Living.com and Furniture.com, which both went bankrupt in 2000. In April 2000, GoodHome.com's monthly sales topped $1 million; the company's goal was to be profitable within two to three years.
One of the website's biggest attractions was its virtual decorating service that let customers see how certain features such as the paint, upholstery fabric, rugs, and pillows would look before a purchase. When considering why this service was so popular, Mack noted that consumers usually feel more confident in a purchase when there are few unknowns. At the time, selling products over the Internet was not a popular concept outside the United States, but Mack was confident in expanding GoodHome.com's portfolio to include foreign companies: "We're already getting so many requests from companies about expanding our website abroad. [...] I see this happening quickly within the next few years."
GoodHome.com encountered difficulties in running its business in 2000, when several other companies that offered similar services launched. The increasing demand for online catalog services, considered a phenomenon, was dubbed the "hottest thing since sliced bread" by an analyst from technology research firm Forrester Research
, which estimated that roughly $500 million was invested in home furnishing websites from 1999 to 2000. It became difficult for consumers to decide which service provided better quality; a business owner commented, "You can't tell the difference in quality between something that's $3,000 and something that's $10,000." GoodHome.com, which had offered free shipping, phased out the feature on July 15, 2000, in favor of "heavily subsidized rates". To compete with new companies, GoodHome.com also introduced new features such as a "floor planning" feature to allow website visitors build an electronic version of their rooms, then drag in furnishings to see how they fit.
's Moore Capital Management and Xcelera of the Cayman Islands
, with cash investments from Cooley Godward and Perkins Coie
. After the latest round of financing, Mack planned for Scene7 to have 15 clients and a burn rate
, or negative cash flow
, of less than $700,000 a month, stating, "What we learned was to stick to your strategy, and don't get nervous when the competition is adopting a strategy to spend their way to victory." At the time, the company's revenues were well below its peak of $1 million a month, but Mack intended to increase revenues past that point in a few months.
Scene7 moved from San Rafael to Hamilton Landing in Novato, California in September 2002 to accommodate more employees. On July 9, 2003, the company acquired all of the assets of workflow
provider and advertising software company Engage for $1.2 million and assumed its $650,000 debt after Engage filed for Chapter 11 bankruptcy. Engage was the parent company of both Cascade and MidSystems, which were two of the first companies that tried to automate prepress
production for newspapers and large printers. On August 15, 2003, Scene7 acquired its top competitor, TrueSpectra of San Mateo
, for an undisclosed amount of cash and stock. On June 15, 2004, Scene7 raised $7.5 million in another round of financing, led by home shopping
company QVC
with some of Scene7's existing investors. At the same time, Jeffrey Branman, President of Interactive Technology Partners at QVC, and David Rubenstein
, co-founder of the private equity
firm The Carlyle Group
, joined Scene7's board of directors, which was composed of James Caccavo of Moore Capital, Andrew Wright of Real Networks, and Mack.
Since the early 2000s, the company's growth has been fueled by an increase in broadband Internet access
, which loads virtual catalogs faster than dial-up Internet access. When catalogs first appeared online in the late 1990s, the graphics took too long to load. After high-speed Internet access became more popular, virtual catalogs quickly grew to become a popular feature of online stores. In addition to faster Internet connectivity, a study in 2000 noted that an online presence for brick and mortar businesses increased offline sales by an average of 27%. Mack also pointed out that having more product information disseminated helps play a role in increasing sales: "We have the ability to provide consistent information. [...] One of the advantages of selling furniture online is the hyperscript; you always have the original specifications on a product."
Scene7 was acquired by Adobe Systems on May 31, 2007 for an undisclosed sum. At that time, Scene7 had 80 employees, most of whom were transferred from Scene7's former headquarters in Novato
, California to Adobe's offices in San Francisco, California. Mack joined Adobe as its vice president of Creative Solutions Services. Scene7 was added to Adobe's product line as a hosted service to help boost Adobe's overall services strategy, especially its software as a service
efforts, and because Scene7 was a great fit due to its heavy usage of Adobe products.
Adobe plans to integrate Scene7's products into Adobe LiveCycle
, the company's suite of server software products, at an unspecified time. The Scene7 brand will continue to be used, but it will "eventually be replaced with the Adobe brand". Denmark-based YaWah, a dynamic imaging software company, was acquired by Adobe on September 26, 2008 to help expand Scene7 globally.
Web hosting service
A web hosting service is a type of Internet hosting service that allows individuals and organizations to make their own website accessible via the World Wide Web. Web hosts are companies that provide space on a server they own or lease for use by their clients as well as providing Internet...
and interactive publishing
Desktop publishing
Desktop publishing is the creation of documents using page layout software on a personal computer.The term has been used for publishing at all levels, from small-circulation documents such as local newsletters to books, magazines and newspapers...
services such as online catalogs, targeted email
Email
Electronic mail, commonly known as email or e-mail, is a method of exchanging digital messages from an author to one or more recipients. Modern email operates across the Internet or other computer networks. Some early email systems required that the author and the recipient both be online at the...
, video, and image management. Several companies, mostly retailers, use the company's services to showcase products on their websites and to allow customers to interact with the products. Scene7's technology allows users to manipulate product images by zooming in and rotating products, simulating the inspection of merchandise in retail stores.
The company, founded as a division of Autodesk
Autodesk
Autodesk, Inc. is an American multinational corporation that focuses on 3D design software for use in the architecture, engineering, construction, manufacturing, media and entertainment industries. The company was founded in 1982 by John Walker, a coauthor of the first versions of the company's...
, created a room decoration computer software called Picture This Home in the mid-1990s. The division was sold to Broderbund in 1998, then spun off as a company called GoodHome.com in June 1999, receiving $30 million in venture capital
Venture capital
Venture capital is financial capital provided to early-stage, high-potential, high risk, growth startup companies. The venture capital fund makes money by owning equity in the companies it invests in, which usually have a novel technology or business model in high technology industries, such as...
. After GoodHome.com failed to become profitable, it was reorganized and renamed Scene7. It formally launched on January 23, 2001 and focused on helping companies prepare interactive advertisements for consumers. Scene7 was acquired by Adobe Systems
Adobe Systems
Adobe Systems Incorporated is an American computer software company founded in 1982 and headquartered in San Jose, California, United States...
on May 31, 2007 for an undisclosed sum.
Company
A subsidiary of Adobe SystemsAdobe Systems
Adobe Systems Incorporated is an American computer software company founded in 1982 and headquartered in San Jose, California, United States...
, Scene7 provides document hosting and interactive publishing services, typically charging clients $30,000 to $50,000 a year to convert catalog print files to interactive web pages. The company does most of its business in North America. Its primary competitors for dynamic imaging services and technology are RichFX and LiquidPixels. Scene7 products rely on several Adobe products, including Adobe Photoshop
Adobe Photoshop
Adobe Photoshop is a graphics editing program developed and published by Adobe Systems Incorporated.Adobe's 2003 "Creative Suite" rebranding led to Adobe Photoshop 8's renaming to Adobe Photoshop CS. Thus, Adobe Photoshop CS5 is the 12th major release of Adobe Photoshop...
, Adobe InDesign
Adobe InDesign
Adobe InDesign is a software application produced by Adobe Systems. It can be used to create works such as posters, flyers, brochures, magazines, newspapers and books. In conjunction with Adobe Digital Publishing Suite InDesign can publish content suitable for tablet devices...
, Adobe Flash
Adobe Flash
Adobe Flash is a multimedia platform used to add animation, video, and interactivity to web pages. Flash is frequently used for advertisements, games and flash animations for broadcast...
, Adobe Illustrator
Adobe Illustrator
Adobe Illustrator is a vector graphics editor developed and marketed by Adobe Systems. Illustrator is similar in scope, intended market, and functionality to its competitors, CorelDraw, Xara Designer Pro and Macromedia FreeHand....
, and Adobe Flex
Adobe Flex
Adobe Flex is a software development kit released by Adobe Systems for the development and deployment of cross-platform rich Internet applications based on the Adobe Flash platform...
; this relationship existed before Adobe purchased the company. Scene7 does not maintain any servers to host its services; instead, it uses a "pay as you grow" program that only requires it to pay for the resources that it uses.
Scene7's clients include the companies Sears, Lands' End
Lands' End
Lands' End is a clothing retailer based in Dodgeville, Wisconsin, that specializes in casual clothing, luggage, and home furnishings. The majority of Lands' End's business is conducted through mail order and Internet sales, but the company also runs more than a dozen retail operations, primarily in...
, Harrods
Harrods
Harrods is an upmarket department store located in Brompton Road in Brompton, in the Royal Borough of Kensington and Chelsea, London. The Harrods brand also applies to other enterprises undertaken by the Harrods group of companies including Harrods Bank, Harrods Estates, Harrods Aviation and Air...
, Macy's
Macy's
Macy's is a U.S. chain of mid-to-high range department stores. In addition to its flagship Herald Square location in New York City, the company operates over 800 stores in the United States...
, Office Depot
Office Depot
Office Depot is a supplier of office products and provides many services. The company's selection of brand name office supplies includes business machines, computers, computer software and office furniture, while its business services encompass copying, printing, document reproduction, shipping,...
, Levi Strauss & Co.
Levi Strauss & Co.
Levi Strauss & Co. is a privately held American clothing company known worldwide for its Levi's brand of denim jeans. It was founded in 1853 when Levi Strauss came from Buttenheim, Franconia, to San Francisco, California to open a west coast branch of his brothers' New York dry goods business...
, La-Z-Boy
La-Z-Boy
La-Z-Boy Incorporated is a furniture manufacturer based in Monroe, Michigan, USA which makes home furniture, including upholstered recliners, sofas, stationary chairs, and sleeper sofas...
, and QVC
QVC
QVC is a multinational corporation specializing in televised home shopping. Founded in 1986 by Joseph Segel in West Goshen Township, Pennsylvania, United States, QVC broadcasts in five countries as QVC US, QVC UK, QVC Germany, QVC Japan and – QVC Italy to 200 million households...
. In 2001, Scene7 agreed to develop home design and landscaping software for Individual Software for $50 million. High-end casual clothing retailer Anthropologie
Anthropologie
Anthropologie is a chain of retail stores that sells women's apparel and accessories, home furnishings, imitation found objects and an array of gifts and decorative items.Headquartered in Philadelphia, the company is owned by Urban Outfitters, Inc...
has used Scene7's services to create and deploy online catalogs for its e-commerce website since November 9, 2004. The retailer implemented Scene7's Dynamic Imaging service to let customers zoom in on products, similar to how merchandise is inspected in retail stores. The Harrods
Harrods
Harrods is an upmarket department store located in Brompton Road in Brompton, in the Royal Borough of Kensington and Chelsea, London. The Harrods brand also applies to other enterprises undertaken by the Harrods group of companies including Harrods Bank, Harrods Estates, Harrods Aviation and Air...
department store signed an agreement with Scene7 on June 24, 2005 to use Scene7's imaging and catalog system on the store's website. This required Harrods to convert all its printed material to a digital format for Internet use.
On October 20, 2005, web agency Logan Tod announced that it had partnered with Scene7 to offer new features on its e-commerce websites. These include Scene7's Dynamic Imaging service, which allows visitors to zoom in on products to see details; this feature, Logan Tod claimed, helps to drive purchase decisions. Fathead
Fathead (brand)
Fathead is a brand name of life-sized, precision cut vinyl wall graphics manufactured by Fathead LLC. Fathead LLC is a privately-held company based in Detroit, Michigan. The ownership group is led by Dan Gilbert, who is chairman and founder of Quicken Loans, and also Majority Owner of the...
, a company that builds and sells wall graphics, uses Scene7's services on its website to generate images and to allow visitors dynamically layer images on top of each other. National Business Furniture, a furniture retailer based in Milwaukee
Milwaukee, Wisconsin
Milwaukee is the largest city in the U.S. state of Wisconsin, the 28th most populous city in the United States and 39th most populous region in the United States. It is the county seat of Milwaukee County and is located on the southwestern shore of Lake Michigan. According to 2010 census data, the...
, Wisconsin
Wisconsin
Wisconsin is a U.S. state located in the north-central United States and is part of the Midwest. It is bordered by Minnesota to the west, Iowa to the southwest, Illinois to the south, Lake Michigan to the east, Michigan to the northeast, and Lake Superior to the north. Wisconsin's capital is...
, implemented Scene7's technology on November 3, 2008, allowing visitors to dynamically change the colors of product images on the company's website.
GoodHome.com
Autodesk
Autodesk, Inc. is an American multinational corporation that focuses on 3D design software for use in the architecture, engineering, construction, manufacturing, media and entertainment industries. The company was founded in 1982 by John Walker, a coauthor of the first versions of the company's...
in San Rafael
San Rafael, California
San Rafael is a city and the county seat of Marin County, California, United States. The city is located in the North Bay region of the San Francisco Bay Area...
, California
California
California is a state located on the West Coast of the United States. It is by far the most populous U.S. state, and the third-largest by land area...
. The program allowed people to virtually preview room decoration projects before any work began. Its users can create virtual rooms, change walls and arrange furniture, and create photo-realistic renderings of completed designs. Picture This Home was awarded the Good Housekeeping
Good Housekeeping
Good Housekeeping is a women's magazine owned by the Hearst Corporation, featuring articles about women's interests, product testing by The Good Housekeeping Institute, recipes, diet, health as well as literary articles. It is well known for the "Good Housekeeping Seal," popularly known as the...
Seal of Approval. In 1998, the software and its team of 40 developers were sold to Broderbund, which was owned by The Learning Company
The Learning Company
The Learning Company is an American educational software company, founded in 1980. It produced a grade-based system similar to Knowledge Adventure's JumpStart series. The products for preschoolers through second graders feature Reader Rabbit, and software for more advanced students features The...
, a subsidiary of Mattel Inc. Broderbund eventually spun Picture This Home off as a company called GoodHome.com in June 1999 with Doug Mack as its CEO. The company received $30 million in venture capital from Hearst Interactive Media
Hearst Corporation
The Hearst Corporation is an American media conglomerate based in the Hearst Tower, Manhattan in New York City, New York, United States. Founded by William Randolph Hearst as an owner of newspapers, the company's holdings now include a wide variety of media...
.
Mack noted that before Broderbund spun off GoodHome.com as a separate company, there was a "big culture clash" between the established company and the new media
New media
New media is a broad term in media studies that emerged in the latter part of the 20th century. For example, new media holds out a possibility of on-demand access to content any time, anywhere, on any digital device, as well as interactive user feedback, creative participation and community...
division. He said that companies such as Broderbund were so concerned with established business that smaller, newer divisions found it hard to receive sufficient attention and bandwidth
Bandwidth (computing)
In computer networking and computer science, bandwidth, network bandwidth, data bandwidth, or digital bandwidth is a measure of available or consumed data communication resources expressed in bits/second or multiples of it .Note that in textbooks on wireless communications, modem data transmission,...
. He praised Broderbund's decision to spin the company off as a separate entity: "We would have never been able to build our Web business if we were not in a separate building with separate funding." Mack observed that newer companies like GoodHome.com rarely had any problem in hiring new employees because of the opportunity for Internet companies to grow quickly into "the next Amazon.com
Amazon.com
Amazon.com, Inc. is a multinational electronic commerce company headquartered in Seattle, Washington, United States. It is the world's largest online retailer. Amazon has separate websites for the following countries: United States, Canada, United Kingdom, Germany, France, Italy, Spain, Japan, and...
".
In September 1999, GoodHome.com merged with Alexandria
Alexandria, Virginia
Alexandria is an independent city in the Commonwealth of Virginia. As of 2009, the city had a total population of 139,966. Located along the Western bank of the Potomac River, Alexandria is approximately six miles south of downtown Washington, D.C.Like the rest of northern Virginia, as well as...
, Virginia
Virginia
The Commonwealth of Virginia , is a U.S. state on the Atlantic Coast of the Southern United States. Virginia is nicknamed the "Old Dominion" and sometimes the "Mother of Presidents" after the eight U.S. presidents born there...
-based nHabit.com, a rival company, for an undisclosed sum. After the merger, GoodHome.com was assured that it would grow quickly; the merger also added the Internet service provider
Internet service provider
An Internet service provider is a company that provides access to the Internet. Access ISPs directly connect customers to the Internet using copper wires, wireless or fiber-optic connections. Hosting ISPs lease server space for smaller businesses and host other people servers...
America Online to GoodHome.com's portfolio as a client. Ten weeks after forming a business plan, GoodHome.com officially launched on September 29, 1999 with offices in San Rafael and New York City, New York, and Roger Horchow
Roger Horchow
Samuel Roger Horchow is a catalog entrepreneur and Broadway producer.In 1971, Horchow started , the first luxury mail-order catalog that was not preceded by a brick-and-mortar presence...
was assigned as its chairman. The company used the slogan "A beautiful home. It was never this easy," and focused on selling furniture and other home items, spending $20 million on advertisements in its first year. Mack decided that the company should target women, since "women make 80 percent of decorating decisions." The company built a home furnishings portal to compete with the websites Living.com and Furniture.com, which both went bankrupt in 2000. In April 2000, GoodHome.com's monthly sales topped $1 million; the company's goal was to be profitable within two to three years.
One of the website's biggest attractions was its virtual decorating service that let customers see how certain features such as the paint, upholstery fabric, rugs, and pillows would look before a purchase. When considering why this service was so popular, Mack noted that consumers usually feel more confident in a purchase when there are few unknowns. At the time, selling products over the Internet was not a popular concept outside the United States, but Mack was confident in expanding GoodHome.com's portfolio to include foreign companies: "We're already getting so many requests from companies about expanding our website abroad. [...] I see this happening quickly within the next few years."
GoodHome.com encountered difficulties in running its business in 2000, when several other companies that offered similar services launched. The increasing demand for online catalog services, considered a phenomenon, was dubbed the "hottest thing since sliced bread" by an analyst from technology research firm Forrester Research
Forrester Research
Forrester Research is an independent technology and market research company that provides its clients with advice about technology's impact on business and consumers. Forrester Research has five research centers in the US: Cambridge, Massachusetts; New York, New York; San Francisco, California;...
, which estimated that roughly $500 million was invested in home furnishing websites from 1999 to 2000. It became difficult for consumers to decide which service provided better quality; a business owner commented, "You can't tell the difference in quality between something that's $3,000 and something that's $10,000." GoodHome.com, which had offered free shipping, phased out the feature on July 15, 2000, in favor of "heavily subsidized rates". To compete with new companies, GoodHome.com also introduced new features such as a "floor planning" feature to allow website visitors build an electronic version of their rooms, then drag in furnishings to see how they fit.
Reorganization
After spending several years operating at a loss, GoodHome.com reorganized as Scene7, which formally launched on January 23, 2001, with $15 million raised from investors that included Hearst Interactive Media. The new company focused on helping companies prepare interactive advertisements for consumers. Mack, the Broderbund executive who had decided to spin off the company, reflected on the decision to reorganize and relaunch: "We got a year into [the initial GoodHome scheme] and the whole B2C (business-to-consumer) market tanked, and we realized we could not build a successful business as a portal [...] But the whole time we kept having people approach us to license the technology [to create virtual catalogs], and finally a light bulb went off when we realized we were sitting on top of a great technology we could sell." Scene7 raised a round of financing on July 12, 2001 that totaled $11.3 million, which helped stabilize the company. The deal was led by venture capitalists from several firms, including Louis BaconLouis Bacon
Louis Moore Bacon is an American hedge fund manager, trader and founder of Moore Capital Management.-Family and education:Bacon was born in Raleigh, North Carolina; his father, Zachary Bacon Jr., founded Bacon & Co. and led Prudential Financial’s and Merrill Lynch’s real estate efforts in North...
's Moore Capital Management and Xcelera of the Cayman Islands
Cayman Islands
The Cayman Islands is a British Overseas Territory and overseas territory of the European Union located in the western Caribbean Sea. The territory comprises the three islands of Grand Cayman, Cayman Brac, and Little Cayman, located south of Cuba and northwest of Jamaica...
, with cash investments from Cooley Godward and Perkins Coie
Perkins Coie
Perkins Coie is an international law firm based in Seattle, Washington. It has been listed on the Fortune Magazine "100 Best Places to Work in America" for the past nine years. It is noted for its intellectual property, Labor and Employment, and Products Liability practice groups, and for its...
. After the latest round of financing, Mack planned for Scene7 to have 15 clients and a burn rate
Burn rate
Burn rate is a synonymous term for negative cash flow. It is a measure for how fast a company will use up its shareholder capital. If the shareholder capital is exhausted, the company will either have to start making a profit, find additional funding, or close down.The term came into common use...
, or negative cash flow
Cash flow
Cash flow is the movement of money into or out of a business, project, or financial product. It is usually measured during a specified, finite period of time. Measurement of cash flow can be used for calculating other parameters that give information on a company's value and situation.Cash flow...
, of less than $700,000 a month, stating, "What we learned was to stick to your strategy, and don't get nervous when the competition is adopting a strategy to spend their way to victory." At the time, the company's revenues were well below its peak of $1 million a month, but Mack intended to increase revenues past that point in a few months.
Scene7 moved from San Rafael to Hamilton Landing in Novato, California in September 2002 to accommodate more employees. On July 9, 2003, the company acquired all of the assets of workflow
Workflow
A workflow consists of a sequence of connected steps. It is a depiction of a sequence of operations, declared as work of a person, a group of persons, an organization of staff, or one or more simple or complex mechanisms. Workflow may be seen as any abstraction of real work...
provider and advertising software company Engage for $1.2 million and assumed its $650,000 debt after Engage filed for Chapter 11 bankruptcy. Engage was the parent company of both Cascade and MidSystems, which were two of the first companies that tried to automate prepress
Prepress
Prepress is the term used in the printing and publishing industries for the processes and procedures that occur between the creation of a print layout and the final printing...
production for newspapers and large printers. On August 15, 2003, Scene7 acquired its top competitor, TrueSpectra of San Mateo
San Mateo, California
San Mateo is a city in San Mateo County, California, United States, in the San Francisco Bay Area. With a population of approximately 100,000 , it is one of the larger suburbs on the San Francisco Peninsula, located between Burlingame to the north, Foster City to the east, Belmont to the south,...
, for an undisclosed amount of cash and stock. On June 15, 2004, Scene7 raised $7.5 million in another round of financing, led by home shopping
Home shopping
Home shopping commonly refers to the electronic retailing/home shopping channels industry, which includes such billion dollar television-based and e-commerce companies as HSN, QVC, eBay, ShopNBC, Buy.com, and Amazon.com, as well as traditional mail order and brick and mortar retailers as Hammacher...
company QVC
QVC
QVC is a multinational corporation specializing in televised home shopping. Founded in 1986 by Joseph Segel in West Goshen Township, Pennsylvania, United States, QVC broadcasts in five countries as QVC US, QVC UK, QVC Germany, QVC Japan and – QVC Italy to 200 million households...
with some of Scene7's existing investors. At the same time, Jeffrey Branman, President of Interactive Technology Partners at QVC, and David Rubenstein
David Rubenstein
David M. Rubenstein is the co-founder of The Carlyle Group, a global private equity firm. In the 2011 Forbes ranking of the wealthiest Americans, Rubenstein was ranked 148th with a net worth of $2.6 billion.-Early life and career:...
, co-founder of the private equity
Private equity
Private equity, in finance, is an asset class consisting of equity securities in operating companies that are not publicly traded on a stock exchange....
firm The Carlyle Group
Carlyle Group
The Carlyle Group is an American-based global asset management firm, specializing in private equity, based in Washington, D.C. The Carlyle Group operates in four business areas: corporate private equity, real assets, market strategies and fund-of-funds, through its AlpInvest subsidiary...
, joined Scene7's board of directors, which was composed of James Caccavo of Moore Capital, Andrew Wright of Real Networks, and Mack.
Since the early 2000s, the company's growth has been fueled by an increase in broadband Internet access
Broadband Internet access
Broadband Internet access, often shortened to just "broadband", is a high data rate, low-latency connection to the Internet— typically contrasted with dial-up access using a 56 kbit/s modem or satellite Internet with inherently high latency....
, which loads virtual catalogs faster than dial-up Internet access. When catalogs first appeared online in the late 1990s, the graphics took too long to load. After high-speed Internet access became more popular, virtual catalogs quickly grew to become a popular feature of online stores. In addition to faster Internet connectivity, a study in 2000 noted that an online presence for brick and mortar businesses increased offline sales by an average of 27%. Mack also pointed out that having more product information disseminated helps play a role in increasing sales: "We have the ability to provide consistent information. [...] One of the advantages of selling furniture online is the hyperscript; you always have the original specifications on a product."
Acquisition
Novato, California
Novato is a city located in the North Bay region of the San Francisco Bay Area, in northern Marin County. Novato is located about north-northwest of San Rafael, at an elevation of 30 feet above sea level . The 2010 U.S. Census estimated the city population to be about 51,904. Novato is about ...
, California to Adobe's offices in San Francisco, California. Mack joined Adobe as its vice president of Creative Solutions Services. Scene7 was added to Adobe's product line as a hosted service to help boost Adobe's overall services strategy, especially its software as a service
Software as a Service
Software as a service , sometimes referred to as "on-demand software," is a software delivery model in which software and its associated data are hosted centrally and are typically accessed by users using a thin client, normally using a web browser over the Internet.SaaS has become a common...
efforts, and because Scene7 was a great fit due to its heavy usage of Adobe products.
Adobe plans to integrate Scene7's products into Adobe LiveCycle
Adobe LiveCycle
Adobe LiveCycle Enterprise Suite is a SOA Java EE-based server software product from Adobe Systems Incorporated used to build applications that automate a broad range of business processes for enterprises and government agencies...
, the company's suite of server software products, at an unspecified time. The Scene7 brand will continue to be used, but it will "eventually be replaced with the Adobe brand". Denmark-based YaWah, a dynamic imaging software company, was acquired by Adobe on September 26, 2008 to help expand Scene7 globally.