"Apple's entry into the space validates our market." That's what I usually hear from startup CEOs when whatever function their small, clever app does gets baked into an iOS or OS X update. I think I've heard it a hundred times, almost every time Apple, Google, Microsoft, Facebook, or Twitter has made a major move.
What the CEO really means: "Oh boy, we're toast." Or, "Maybe a big competitor to Apple (or whoever) will buy us, oh please oh please."
"We already validated the market!" Matt Brezina, Sincerely's CEO, said to me on this topic. "I really didn't want anyone else to know this was a good business." But, he says, Apple clearly already knew it; the company has had a photo book printing business for years. See his post on the topic.
While Cards took Brezina by surprise, the company was already planning to launch what it's announcing today: An API (and 12 launch partners) for its tool that lets any photo-based app vendor add the capability to send printed cards or postcards from within apps.
This is probably the best thing Sincerely can do given what Apple just did. And the business could work. Sincerely charges developers 99 cents per card sent, plus 30 percent of everything above that. There are a lot of photo apps. Sincerely makes two itself, Postagram (my story) and PopBooth. Photo app makers, including Sincerely, should be able to sell products that undercut Apple's prices.
Launch partners include Path, Lonely Planet, and Pic Collage. Brezina says he expects a hundred or more by year end. Instagram, notably, is not in today's list of partners. Postagram can already send photos that Instagram takes, but think Brezina would be happy to offer tighter integration and the help the company provide printing and mailing services to its users.
What's Sincerely going to do when Apple, too, offers up a printing API? After all, the model of skimming a service fee from developers for app sales, in-app purchases, or media subscriptions seems ingrained at Apple. Brezina says, "It's not their core business," which I think is wishful thinking. But, more realistically, he does say that were Apple to open a Card API, "it'd be another year or two," and that he's going to keep the company moving. "During that time, I'll have six innovations."