Type Network's new CEO

MrEchs

Hi, all. I wanted to share the news that some of you have heard -- I've joined Type Network as CEO starting this week.

I'll have more to share on the direction of Type Network in 2024. For now, here's what is not changing:

TN is focused on the "high end" of the type industry -- helping the world's most talented type designers find opportunities to grow their business with sophisticated buyers who appreciate fine type.

Today we're most likely to find those customers among corporate or "enterprise" buyers. We're also building on the legacy of Webtype and Font Bureau, both of which had a large customer base of discerning individual purchasers. At the end of 2023 we've launched new enterprise licensing programs that are winning new customers for our partners. Our new consulting offering is delivering custom font projects from major corporate clients to trusted partners in our foundry network.  

Now more than ever, the type industry needs partners who are closely aligned with the interests of type designers. TN has always fit that description, and I'll be looking for ways to help it do even better. We'll continue to pay the highest royalty rates in the business. We will base our foundry partnerships on personal relationships with type designers. We will not offer type produced by generative AI, nor will we license our partners' type for use to train generative AI.

In my career, I've learned that marketplaces can find short-term success by choosing to focus either on buyers or sellers. This kind of short-term thinking is rewarded when vast private fortunes are deployed in an effort to win market share, undermine competition, and generate outsized investment returns. 

In the long run, we believe that the type industry will be defined by companies that fairly and thoughtfully balance the interests of buyers and sellers. Type Network was founded by and remains owned by type designers. The founders, shareholders, foundry partners, and employees all share the same belief: great design starts with great fonts, and great fonts come from the world's most talented type designers.

If you'd like to talk to us, drop me a line: matthew@typenetwork.com -- I'm always interested in hearing from you. You can also book a 1:1 call with me here:

https://calendly.com/tn-matthew

--Matthew
CEO, Type Network

John Hudson

Today we're most likely to find those customers among corporate or "enterprise" buyers.

I recall, when you were at Adobe, you were keen on the idea of selling fonts in volume to ‘normals’. You were surely not alone in that hope, but the resulting depreciation of retail licensing prices and incessant discounting, along with the gradual reduction of the share of income directed to foundries and designers, has eroded much of the value of the business that independent foundries developed in the 1990s and 2000s. Today we’re most likely to find sophisticated buyers who appreciate fine type among corporate customers because the customer base of smaller and mid-level professional design customers has been demolished by resellers chasing volume.

Kris Sowersby

We'll continue to pay the highest royalty rates in the business. 

What are your royalty rates?

Roger Black

For retail:
50:50 for non-exclusive partner foundries.
70:30 for exclusives, with the partner getting the 70.

MrEchs

Type Network partners earn royalties from 50% - 70% of revenue.

It's our intention to offer designers the most favorable terms, and to become the partner of choice for designers who would otherwise not use third party distribution. 

MrEchs

John Hudson said:

Today we're most likely to find those customers among corporate or "enterprise" buyers.

I recall, when you were at Adobe, you were keen on the idea of selling fonts in volume to ‘normals’. You were surely not alone in that hope, but the resulting depreciation of retail licensing prices and incessant discounting, along with the gradual reduction of the share of income directed to foundries and designers, has eroded much of the value of the business that independent foundries developed in the 1990s and 2000s. Today we’re most likely to find sophisticated buyers who appreciate fine type among corporate customers because the customer base of smaller and mid-level professional design customers has been demolished by resellers chasing volume.

I appreciate the feedback, John. I think we agree about a lot of this. Obviously I don't see our work at Adobe as the cause of the effects you describe, but I will reflect further on that. Thank you for sharing it with me. 

Kris Sowersby

Apart from an extra 20%, what does a foundry for going exclusive?

Roger Black

Kris : The greater rev share *is* the main benefit of TN exclusive partnerships. We are careful in retail promotions and enterprise or custom sales efforts not to favor one foundry over others. 

However, communications to clients about compliance issues (which we do carefully, and with the goal of keeping the client) are only undertaken on behalf of exclusive partners. Results from a web spider are checked with our license list. If not okay, we check with the exclusive foundry. But we can't easily check other distributors for a number of reasons. 

Foundries with exclusive agreements tend to be the most active partners at TN. They provide more information and data about their releases, and they communicate more frequently. As we expand TN's consulting agency, we've found the exclusives are a bit faster to join pitches.

In all businesses, communication is the key. Join us!

Ramiro Espinoza

.

Craig Eliason

MrEchs said:

We'll continue to pay the highest royalty rates in the business. 

What about 65% Now and Forever - Font Bros?

John Hudson

Matthew:

I appreciate the feedback, John. I think we agree about a lot of this. Obviously I don't see our work at Adobe as the cause of the effects you describe, but I will reflect further on that.

I think Adobe initially did things about as well as it could be done. The 60% royalty rate to foundries inherited from TypeKit was good, and the leveraging of the existing Adobe CS and CC user base and the font activation tracking meant that Adobe’s subscription model pretty quickly generated significant income for those foundries involved in the program. But I believe subscription services are inherently problematic for foundries and type designers in the long run, and will inevitably result in diminishing returns for most foundries. The royalty rates have already been cut.

Of concern in all the schemes dreamed up by large companies to generate volume sales of font licenses is a) those companies are not primarily in the business of designing typefaces and ultimately don’t care about the people who are, and b) their business models consistently undermine those developed by the people who design typefaces and sell fonts direct to customers.

In the 1990s, the old type companies were bust. Many had gone out of business or were on their way out. Monotype was bankrupt and only spared from receivership by a bail-out by Microsoft. Those that remained found themselves under-capitalised on a level playing field with a bunch of type designers who had started their own type foundries and were building a new business model around selling font licenses direct to clients. And a lot of those new foundries were successful at this, because they were led by creative and enthusiastic people and they knew how the customer industries of graphic design, branding, etc. worked. In a couple of respects, the independent type foundry model was a victim of its own early success: a) it inspired large numbers of young creative individuals to get into type design, saturating the market with so many new typefaces in recent years that it is no longer possible to keep track of them all, meaning that popularity, when it happens, tends to be at a niche level, and b) it made some people with money think that fonts looked like a good thing to invest in, and they gave that money to companies like Monotype because capitalists hate small businesses and companies headed by creatives.

The model of font licensing developed in the 1990s and 2000s by independent foundries relied on selling at relatively high prices to a customer base of design professionals. That model is undermined—frankly, almost completely demolished now—by a model that seeks to sell to a larger market at unsustainably decreasing prices and discounts. So here we are, ‘most likely to find sophisticated buyers who appreciate fine type among corporate or "enterprise" buyers’, because the successful and vital markets that my colleagues built* in the 1990s and 2000s have been wrecked by people who don’t make typefaces for a living.

____

*My own business was almost entirely focused on client-based custom font development, rather than retail licensing, during the same period. Ironically, I have always been working with corporate and enterprise buyers, but did so in what I saw as a healthy ecosystem of font creation and licensing, involving multiple levels and kinds of markets. Now the bottom end has collapsed the middle.

Simon Cozens

Congratulations!

MrEchs

Thanks, Simon!

Craig, I think the Font Bros arrangement is terrific. As Roger pointed out, there's more to what we offer than that number but I do appreciate their straightforward approach.

John, thanks for the kind words and for sharing your views on the business.

Type Network is owned by type designers. Ss you point out, this ensures our interests remain aligned with our partners.

I expect foundries will continue to evaluate us carefully and critically to ensure it stays that way. 

--Matthew

Enrico Sogari

Great way to start the new year. Well done.

Kris Sowersby

John Hudson said:

 In a couple of respects, the independent type foundry model was a victim of its own early success: a) it inspired large numbers of young creative individuals to get into type design, saturating the market with so many new typefaces in recent years that it is no longer possible to keep track of them all, meaning that popularity, when it happens, tends to be at a niche level, and b) it made some people with money think that fonts looked like a good thing to invest in, and they gave that money to companies like Monotype because capitalists hate small businesses and companies headed by creatives.

That’s like complaining it’s hard to keep track of all the games/movies/music/books etc etc that are released now that the barrier to entry is so low. There was the dreaded “indiepocalypse” a few years ago in the games industry which amounted to fear-mongering over nothing. It’s not the same thing as fonts, but there are parallels.

John Hudson

A key difference being that the games market is a genuinely mass market, in which a tiny market share can still translate into significant income. The market for retail font license purchasing is comparatively small and I don’t think it has grown proportional to supply.

Kris Sowersby

Roger Black said:

Kris : The greater rev share *is* the main benefit of TN exclusive partnerships. We are careful in retail promotions and enterprise or custom sales efforts not to favor one foundry over others.

@Mark Simonson’s “everything everywhere all at once” approach. No reseller has 100% market coverage. 20% extra on a sale is unlikely to offset the market coverage of being on several platforms at once.

Foundries with exclusive agreements tend to be the most active partners at TN. They provide more information and data about their releases, and they communicate more frequently. As we expand TN's consulting agency, we've found the exclusives are a bit faster to join pitches.

How exactly do you deal with foundry-generated marketing? Do you post their video/image assets across all of your channels? Do you re-make marketing assets to fit with TN’s house style? Do you run print ads? Buy google ads?

In all businesses, communication is the key. Join us!

No thanks.

MrEchs

Kris Sowersby said:

How exactly do you deal with foundry-generated marketing? Do you post their video/image assets across all of your channels? Do you re-make marketing assets to fit with TN’s house style? Do you run print ads? Buy google ads?

I'm not sure if this is the answer you're looking for, and with the caveat that I am still getting up to speed here: yes, we do or have done these things sometimes, but not always. Foundries do their own marketing, and we cooperate on some. I'd have to give more thought to a "house style" for advertising, but we certainly are not looking to restrict the style or messaging of our partners. 

Prior to joining TN, my experience with Google Ads is that it's very difficult to make them work effectively. Monotype shares a vastly smaller share of their revenue with foundries, and they buy ads at a vastly larger scale. This means they can pay a much higher rate for the same or similar terms, and that increases the rates for everybody else. 

We do have a specialized agency that helps us optimize our spending on advertising, and we're always looking for ways to help our partners stand out in the very crowded space.

If you take a look at
https://typenetwork.com/articles

you can see some of the excellent work my colleagues have put into helping our partners tell their stories, which also attracts some search engine traffic.

Our partnership with Adobe supplies a lot of inbound traffic, and we are considering other distribution partnerships that would multiply that effect.

--Matthew

cornel windlin

congratulations on your new job, matthew. interesting thread. you state: "type network is owned by type designers." i'm interested to understand: who are they, who owns type network, exactly?

MrEchs

Hi Cornel. You can get a sense of who is behind Type Network at:
https://typenetwork.com/about

I'm super interested to talk with you or anybody else from the type community, if you want to learn more about Type Network or if you have feedback to share.

You can book a meeting with me here:
https://calendly.com/tn-matthew

My email is matthew at typenetwork dot com.

Kris Sowersby

I too would like to know who exactly the owners are! The about page isn’t clear. Who are the type designers that own Type Network?

cornel windlin

hi matthew, i’m glad you’re super interested to talk. so am i! already did have a sense of who's operating type network, but now i’m super interested to understand who owns it. i’m sure the type community is, too, especially after you made a point that it is 'designer owned’. so, who owns type network?

MrEchs

Happy to fill you on the ownership. We'll update the web site to clarify this.

The board members are all owners of the Type Network limited liability corp (Massachusetts), which is organized as a partnership. Roger Black is the majority owner.

All of the other board members are owners and TN founders: David Berlow, Jill Pichotta, David Jonathan Ross, and Petr van Blokland. Two other founders also have stakes in the firm: Sam Berlow and Paley Dreier. Roger, Sam, and Paley aren't type designers, but have long track records of interests aligned with the type industry. 

Kris Sowersby

Ok, so TN is partially owned by typeface designers. And that part is a minority stake. One owner (Sam Berlow) started a competing outfit (TTF), another (David Berlow) sold the rights to his fonts to Monotype, which TN still resells. It’s curious that D Berlow entrusted neither TN nor TTF with his fonts, both of which are perfectly capable of performing legacy custodianship. 

I’m loathe to be pedantic, but stating that, “Type Network was founded by and remains owned by type designers” sounds a bit disingenuous when the actual ownership and stakes are laid out. I understand that saying some owners have “long track records of interests aligned with the type industry” sounds reassuring, but it’s not a guarantee of best interests. We’ve seen many people/companies with interests aligned with the type industry collapse, fail & succumb to the crushing weight of modern capitalism… ie sell to Monotype. And the people who always suffer the most are the typeface designers, the ones making the fonts that provide the lifeblood of these ventures. 

MrEchs

I can understand your skepticism, and I agree that my choice of words was imprecise. I appreciate being held to a high standard. That is what the industry needs, and I intend to live up to it. 

JoyceKetterer

@Kris Sowersby the one founder who started a competing company is Paley.  So far as I know Sam is just an employee of The Type Founders. If I'm wrong about that then it's two founders who started a competing company.  That said, the implication of Mathew's post is that they aren't voting members.  

As an aside, I'm a business side long time font person and I find that people tend to colloquially refer to me as a "typeface designer" because "font person" sounds weird.  Rodger is definitely in the same category as me.  

John Hudson

Are Type Network and The Type Founders competing? Or complementary and synergistic? I’d assumed the latter. They have different business models.

Nick Shinn

It doesn’t matter whether the distribution platform is owned by type designers, because they may sell it anyway. If you don’t want your font business to end up in a distribution channel owned by Monotype or whoever, you have to be the primary (if not only) distributor of your own fonts.

The process of enshittification: first, attract the “content” creator with a nice offer to distribute their wares, then when the majority of their business is through your channel, they are powerless. Sorry if this sounds cynical MrEchs, but that’s how the system works, irrespective of the people involved and their intentions. Or is there a “The distributor will never sell its business to Monotype” clause? 

Personally, I see the way forward for independent foundries as social media marketing linking directly to one’s own ecommerce site, in which case one’s third party is not a bona fide licence reseller, but an ecommerce marketing agency, working for fee not royalty, perhaps specializing in the fonts niche.

MrEchs

I'll just add that foundry partners can terminate their agreement and withdraw from Type Network any time they like. It's a different situation if the IP becomes owned by the distributor, but that's not our model. 

John Hudson

I see the way forward for independent foundries as social media marketing linking directly to one’s own ecommerce site

That’s what I assumed would be the way forward a few years ago, but now I am very uncertain of the social media marketing basket into which basically everyone has put all their eggs.

Ray Larabie

@John Hudson I'm with you on this. It seems the traditional pathway from social media exposure to font sales, or even free font downloads, isn't nearly as effective as it once was. The landscape appears to have almost fully shifted towards collective storefronts that offer a broader range of options. Customers seem more drawn to these comprehensive platforms, whether they're traditional font vendors or fonts-as-a-service models, rather than focusing on individual typefaces or smaller foundries as they did a few years ago.