Magic Memories quadruples revenue in three years

Magic Memories quadruples revenue in three years

14 May 2018

Queenstown-based Magic Memories has quadrupled revenue to $US120 million in 2017 from $US30m three years ago due to global expansion and its acquisition of a major US competitor.

The company, which featured in NBR’s Radar series on smart Kiwi companies last year, was co-founded in 1995 by John Wikstrom and Stuart Norris. It captures photos and videos of people’s experiences at 180 key tourist attractions in 10 countries including the likes of London Zoo, Legoland in California and the Barcelona Football Club.

Its revenue has been boosted by the 2016 acquisition for an undisclosed sum of US-based SharpShooter Imaging – the largest purchase it has made to date. It turned Magic Memories into the industry leader for content and photography solutions for the attractions industry.

Kiwi companies tend to be shy of foreign direct investments although it’s a tried and true strategy for Silicon Valley companies to speed their growth, and one that has been pushed by Magic Memories board. Previous acquisitions included Centryc Solutions, the Sydney-based developer of MeTag which lets park operators interact with visitors even before they come through the gates, and American tech company Jackson Digital Imaging.

Simon Robinson, acting chief financial officer for Magic Memories, says it has set out to grow aggressively in North America, which now accounts for between 60-70% of revenue, and Europe.

He says North America continues to be the main focus for future growth.

“The tourism attraction industry is large and we’re only just touching the surface of it. There is a lot of potential there and that’s where we see more immediate growth coming from. Longer term there will be more opportunities in Europe and the Asian market, which we have not really tapped into yet.”

The other major push by the company is developing its e-commerce offering online in the next 12 months, beyond just incorporating the cost of its offering in the entry ticket price of one of its partner’s attraction.

Mr Robinson says the company is trying to build its direct relationship with attraction customers rather than the traditional approach of simply selling them a physical product and the relationship ending at the gate.

“We’re moving toward increasing the number of digital offerings and growing the relationships. What that means is registering a large number of guests’ details and that allows us to provide them with digital images but communicate more to sell further products.”

In March the company hired four executives with experience in scaling global brands, including a head of development to accelerate creating a range of advanced products that can be offered to attraction guests in the next year.

Another two members were also added to its board – Sanjay Dholokia, ex chief marketing officer of Marketo, to help in its ambition to expand into an omni-channel business plus Jeff Ryan chief people officer for Zynga.

Growth equity investor Pioneer Capital bought into the private firm in late 2016 when co-founder Stuart Norris sold down his stake. The growth investor is now the largest shareholder with a 19.15% stake and holds one of the seven board seats. Co-founder John Wikstrom has retained a 13.48% stake.

Chairman Mark Bowman says there are no immediate plans to consider a public listing of the company, though he wouldn't rule it out altogether. The focus now is on doing "what we need to do" to become a truly global business, he says.