Jerry Kennelly of Tralee, County Kerry, and his wife Johanna were the founders and driving force behind Stockbyte, a company that specializes in the selling of photographic images. The Kennellys started the firm with an initial investment of around $150,000 in 1997.
The sale of the company – and an associated venture called Stockdisc founded two years ago – therefore realizes a profit of almost 1000 percent for the couple.
Despite his newfound wealth, Kennelly has told Irish newspapers that he has no intention of becoming a tax exile, and will remain in Kerry for the foreseeable future.
Stockbyte has been bought by Getty Images, the huge company founded by Mark Getty, a grandson of the first John Paul Getty, the famous oil magnate who was once the world’s richest man.
Getty Images was one of only a handful of companies that remained larger than Stockbyte after the Irish firm’s dizzying rise. By most estimates, Stockbyte was the third biggest company of its type in the world after Getty and Corbis, which is owned by Microsoft’s Bill Gates.
Getty Images spokeswoman Alison Crombie told the Echo that Getty would preserve the Stockbyte brand name despite its absorption into the bigger company. She added that the acquisition was part of “our strategy to grow wholly-owned content.”
The core of Stockbyte’s business was supplying stock images for use on billboards, in brochures, in company reports and the like. It also sold to publications large and small – it received a prestigious boost in 2003 when its images twice adorned the cover of Time magazine.
Crombie noted that recent technological developments, ranging from the increased use of broadband internet to the introduction of more sophisticated cellphones, are having the effect of expanding the market for images. The acquisition of Stockbyte will better position Getty to supply this growing demand, she asserted. Stockbyte has a library of around 85,000 images.
Kennelly himself told Irish media that in one way the sale of the company was “bittersweet”. Stockbyte’s 28 staff will either have to relocate to work for Getty Images or will find themselves without jobs. However, Kennelly and his wife have made one substantial move to ease that pain. They have earmarked around $6m of their own post-tax funds from the sale as compensation for the workers. The employees will therefore get an average of $210,000 after-tax from the sale. Kennelly said he expected that many of them would use the money to help set up their own businesses.
The Tralee native last week told the Irish Times:
“We have proved location is not an issue when staff are smart, intelligent and tenacious. They are a very talented group of people. All of their stock has risen today.”
“It was the right time to exit. There are a lot of dynamics that are changing this business. For example, there’s a growing demand for color images that can be downloaded to mobile phones.”
Despite the relative youth of Stockbyte, Kennelly has a long history in the media business. His parents founded the Kerry’s Eye newspaper in 1974, and he and his brothers worked on the paper from their teen years on. Kennelly is the only one of four children not to still be involved in the paper.
“I was reared in a darkroom,” Kennelly told an Irish newspaper, The Sunday Business Post, last year. “School was a part-time gig for us all. While I was in school, I was writing and developing pictures all the time. It was part of the effort that was needed to keep the boat floating. Failure was never an option.”
The success of Stockbyte was underlined by its latest figures. It claimed sales of approximately $60m last year, which amounted to 10 percent of the worldwide market for images. Getty Images, however, is much bigger, with 1500 employees and a market capitalization of $4.6bn.
Kennelly has agreed that he will not compete with Getty Images in the future. But he has said that he expects to pursue other new ventures shortly.
In the meantime, it seems that he and his wife are going to enjoy some of their new wealth. Ireland’s Sunday Times reported in its latest edition that the Kennellys had spent approximately $3.6m on a listed country house hotel in Kerry. The couple intends to convert the 14-bed property into a new home.