Pinterest is in talks to buy VSCO, a photography app that sparked a teen social media craze. The talks are still going on, according to the sources, who did not want to be named because they were not authorized to speak publicly. Pinterest has a market capitalization of about $49 billion, while VSCO has raised $90 million in funding and was last estimated at $550 million. The people warned that an acquisition could not happen.
Pinterest and VSCO representatives refused to comment on the negotiations.
VSCO’s spokesperson, Julie Inouye, said the company was focusing on growing its revenue. “At any given moment, we’re meeting with various companies around the creative room, and we don’t discuss gossip or speculation,” she explained.
Pinterest and VSCO (Video Supply Company) are part of a community of software companies that are focused on digital images and visual processing rather than social networking. Pinterest, a digital pinboard platform that went public in 2019, allows users to find and save photos to help them schedule important aspects of their lives such as home renovations, weddings, and meals.
VSCO is a 10-year-old company that creates an app for editing and uploading photos and videos. It was popularised in 2019 by a Gen Z group known as the “VSCO girls,” who were known for wearing Crocs and carrying Hydro Flasks. The VSCO girls’ definition went viral, inspiring parody, satire, memes, and Halloween costumes on social media.
According to the people, Pinterest could strengthen its core service by purchasing a once-famous startup that was popular with younger audiences and has expertise in a photo- and video-editing technology.
Pinterest’s revenue has risen since it went public, but analysts have estimated that it will not be profitable until 2022. It has also risen in popularity on a global scale.
When people were shut down and switched to more interactive practices during the pandemic, the business saw an increase in interest. Last year, Pinterest added 100 million monthly active users, taking the total number of monthly active users to 450 million.
Last year, the San Francisco-based firm experienced social unrest as well. It settled gender discrimination and retaliation complaint by its former chief executive officer for $22.5 million in December, one of the biggest publicly disclosed individual settlements for gender discrimination. Two black female workers who left the organization last year also spoke out about their encounters with racist and derogatory remarks, wage gaps, and retaliation.
VSCO, which was established in 2011, became popular among younger users as an anti-social network. Since the app lacks likes, feedback, or follower counts, users tend to be under less pressure to create a fan base. VSCO also avoids ads in favor of charging users for additional features. More than 2 million of its 100 million registered users are paid, subscribers.
Investor interest in the startup exploded after the VSCO girls became a cultural sensation in late 2019. However, the craze has passed. When the pandemic struck, VSCO laid off 30% of its workers. It bought Trash, a mobile video editing app, in December and said it intended to keep buying companies in 2021.