To our customers,
I am delighted to announce that Phanfare has reached profitability. We had our first profitable month ever in June 2010 and will continue to be profitable going forward on both a cash and accrual basis. This is a significant accomplishment for the company and I am incredibly proud of our team for making it happen.
Mark Heinrich and I founded the company in June 2004, six years ago. Our goal was to enable you to preserve your photos in original quality for generations to come. Like all startups, we have had our ups and downs. But we have never wavered in our commitment to you and preserving your photographic assets.
We raised prices in June to $99/year for Premium and $199/year for Pro to fix the economic model of the company and make the company sustainable.
We bet the company on that price increase. If significant numbers of you had quit, we would have had very few alternatives.
It took me a long time to get to the point of being willing to raise prices. I knew that raising prices would slow customer growth (it has), but I also knew that we were quickly running out of cash. My logic went like this: I will raise prices to a level where we will be profitable at our current size and let you choose whether we get to exist or not.
You have chosen to pay more for Phanfare and enable us to continue to serve you. Profit is not the purpose of business, but it is certainly a requirement. Peter Drucker believed the purpose of business is to create a customer, and I agree with that.
We have wonderful plans for Phanfare and we plan to be around a long time. We have visions of connected cameras and ubiquitous access to your photos and videos, all backed by a ultra-reliable service that preserves the fidelity of your images.
Thank you for taking this journey with us. It has hardly begun.