VentureBeat

Update: Imagekind has confirmed the purchase.

Imagekind, an online marketplace for original and reprinted artwork, has been bought by online t-shirt and gift seller CafePress, a reliable source tells us, with rival Zazzle losing out on the deal. We hear the acquisition price may have been between $15 million and $20 million, although we’re still looking for confirmation on the amount.

While these days there are seemingly countless sites that let you design and sell your own t-shirts online, CafePress and Zazzle both raised venture rounds years ago and seem to have gained market leadership. Both have also gone beyond t-shirts, looking to get their respective users doing things like buying and selling gifts. Meanwhile, other companies, specifically handmade-goods site Etsy, have also been growing and raising venture funding.

So, the purchase of art-focused Imagekind (sample photo, above) is a classy way for San Mateo, Calif.-based CafePress to further distance itself from just being a t-shirts site (sample t-shirt, below) — and put itself more directly in competition for artists who want to sell their works and buyers who like nice stuff.

The purchase also suggests that it may be too late in the game for new startups to try to create their own t-shirt, art, and gift-selling online marketplaces.

Seattle-based Imagekind, which raised $2.6 million in February of 2007 from German publisher Holtzbrinck, venture firm Crosslink Capital, the Samwer brothers (who now invest via their own firm, European Founders Fund), and a number of angel investors, has in the past rejected a purchase offer from Amazon.com. It competes directly with Art.com, another art marketplace that has also been rumored to be trying to buy the company. During Imagekind’s last funding round, its rumored valuation was up to $7 million — so maybe the company is seeing solid growth and revenue, and maybe also the bidding war got particularly fierce.

[Photo by Imagekind artist James Howe, T-shirt by Flippin' Sweet]

Here’s the latest action:

Google’s fireworks — This has been an impressive week for Google, and it shows in the 4 percent-plus jump in Google’s stock price earlier this morning (though it has tapered in the past hour). The main driver was its stellar earnings report. But here are the side-shows:

Video: It announced a video-conferencing product acquisition this morning (see our story).

StumbleUpon lookalike: Google also released a tool that looks a lot of like StumbleUpon, the site that delivers Web sites for you based on what you’ve told it you find interesting. Google’s tool centers on a recommendation button on its Toolbar that looks like a pair of dice:

Google explains: “Click on the dice, and we’ll take you to a site that may be interesting to you based on your past searches. If you want another, just click the dice again and we’ll show you a new one. We’ll give you up to 50 new sites per day that might be of interest. If you prefer to get your information at a glance, we’ve added a recommendations tab that you can add to your personalized homepage….We’ll give you a page of recommendations that are updated daily.”

Froogle tossed — Google has relaunched its shopping engine, changing its name to the bland Google Product Search. (We think Froogle is a cool name, and should be kept for a discount version of Product Search.) Google didn’t do much marketing of Froogle. With the relaunch, they’ve changed that: In your main search results, Google will sometimes feature an item from its Product Search if it matches your search query exactly (contained atop the regular results in a so-called “onebox” area). Notably, however, there’s no change from the prior policy of using only products submitted to Googlebase. So Google is forcing merchants to play in its system — unfortunately, not trawling the Web for items objectively, the way that made Google so popular in the first place. (See our story here on this). Google is also prioritizing merchants using Google Checkout, thereby penalizing those relying on PayPal. This is another Big Company move that undercuts its image of impartiality. Too bad. (See more thorough analysis at CNET and SearchEngineLand), which obviously got previews before it was released.

Google phones will be out by the end of this year — Apparently, they’re launching with Orange and HTC, featuring Google search and email built in. They’ll sport the Texas Instruments 3G platform and EDGE, but not GPS. (Details here)

There is, however, some non-Google news:

Twitter spun out — Evan Williams, who runs Obvious, the parent of Twitter, they messaging company that is all the rage lately, says Twitter is being spun out into its own company, Twitter Inc, with a CEO in Jack Dorsey.

Mitt Romney gets private equity support — The former Bain Capital chief, Mitt Romney has raised about $257,525 from buyout professionals in the first quarter, way more than anyone else, according to PEHub.

Web 2.0 Pyramid Watch — Cambrian House, a Canadian company creating a place for people to sell their business online, is moving to Mountain View, Calif., and its latest scheme is to give a share of stock in the company to anyone who signs up for his service, according to the SF Chron. He plans to ultimately sell the company or have a public stock offering. “We really are built to flip,” he said. “I’m the only guy who says that out loud. I don’t know why everyone lies.”

Digg releases API, an answer to MySpace News — News-ranking site Digg has released its API, which gives developers tools to build other products around Digg’s data, and also to integrate it into existing sites. You can use the API to request very specific information about news stories and videos submitted to Digg, digging activity, comments, and users. This comes just as MySpace has unveiled its own Digg-like news service (see our previous coverage), built after acquiring Newroo.

Flickr has integrated Imagekind — This gives Flickr users a way to create prints of their photos, or sell them to others online. Techcrunch has story.
(Our coverage of Imagekind.)

Imagekind is a Web site that lets artists upload their artwork for sale, and gives them the freedom to sell it at whatever price they want.

The six-month-old Seattle start-up has just raised $2.6 million in venture capital, which gives it ammunition to go after the industry’s leading site, Art.com. It will announce the funding tomorrow.

Art.com dictates prices more rigidly — it doesn’t let artists set their own price, and apparently only pays them a 10 percent royalty. Imagekind is more new-school, taking only a charge to cover the cost of printing, framing and shipping and small profit ($8.99 is the base price), but letting artists charge however much they want. Some artists are marking up to $300.

VentureBeat heard rumors that Art.com, of Emeryville, Calif., had expressed interest in buying Imagekind. Amazon.com actually made an offer. However, Imagekind decided to go it alone. Art.com, a 12-year-old company backed by Benchmark Capital and Polaris, has more than 500 employees worldwide and reportedly has $150 million in revenue. Imagekind is tiny in comparison. It struggled to get its first 100 artists last year, but now 6,000 artists have uploaded art. Sales have hit 1,000 pieces a month.

We spoke to President Kevin Saliba, who wouldn’t elaborate on the purchase offers, but said the intent is to carve out a No. 2 position behind Art.com, while focusing on higher quality printing paper than Art.com. To that end, it also does its own printing, and has a partnership with a large frame retail chain, Northwest Framing. The site is built with AJAX and Flash.

Imagekind’s funding comes from some high-profile investors. The round was led by Holtzbrinck, the German publisher that recently bought the German version of Facebook, Studivz, and which has become more active in the U.S. recently. Also participating were Crosslink Capital, the Samwer brothers (early investors in eBay Germany), Erik Blachford (former Expedia chief exec), Nick Hanauer (first investor in Amazon.com) and Bill Trimarco (of Larsen-Juhl, a framing company). Saliba said the 15-person Imagekind raised the money in order to do more marketing and expand to places like Europe.

Rumor is the valuation is in the $5- to $7 million range.