Palette Raises $150K Pre-Seed Investment from Startup Ignition Ventures

Palette has recently raised a $150K pre-seed investment from Startup Ignition Ventures.

Palette is a South Jordan, Utah-based B2B SaaS project management and workflow tool for artists and creative teams. The company was publicly launched in September, 2023 and has been applying lean startup techniques to validate its business model, product-market fit and demand from B2B customers, including Angel Studios which is one of its beta users.

TechBuzz sat down with Palette’s founders, Do Park and Hunter Tinney, both of whom have worked at major Hollywood film studios, where they saw the need for better project management software and recognized enormous inefficiencies in the creative processes that go into making animated feature films.

“Although Palette is very early—even for our fund, which is dedicated to pre-seed startups, Do and Hunter are two co-founders who we believe in,” said John Richards, managing partner of Startup Ignition Ventures, a Utah-based pre-seed venture fund. “They have hit on something the target market really likes. They also attended our intensive bootcamp for entrepreneurs (called the Startup Ignition entrepreneur bootcamp) and we are confident in their commitment to building a company correctly for optimum value creation by developing and selling products customers want.”

The origin of Palette stems from an experience early this year when Park was invited by a friend to create a production studio for an animation project that had just been greenlit by AppleTV. Once he got into the planning process he worked out the many steps of the process that would need to be supported by software. He quickly realized that no single software existed in the market for their creative purpose. Instead, he only saw a messy, incoherent mix of multiple softwares, all unrelated to each other and all doing a specific job, but making the lives of the creators unnecessarily complicated.

Park realized in that moment that he wanted to build the optimal software for independent content creators. Instead of joining the Apple TV project, he contacted another friend, Hunter Tinney, whom he knew from BYU's animation program where they had worked together on a senior film project. Tinney, who was working at Netflix at the time, and Park brainstormed ideas for a company that would eventually become Palette. Together, they founded and registered the company in October 2023. They launched a working prototype in the previous month and immediately started showing it to potential customers to validate the need for it and identify product-market fit.

Park interned at Pixar and worked on a student film using Pixar production techniques. He explained the context and the need for affordable and better project management software in the entertainment industry.

He continued, “Studios will use a variety of software for different aspects of production. For project management they might use Asana, Trello, and Google Sheets. For file management and cloud storage, they will typically use Google Drive and Dropbox. For review they will use Frame.io, Vimeo, or SyncSketch. For contracts/payments, they might use HoneyBook or HelloBonsai. Palette is blending the most important features from each of these different software into one that's specifically curated for the creative process.”

It is not a secret that major feature films, like those produced by Disney, Pixar, or DreamWorks, can take anywhere between three to five years to create and have massive production budgets of $100 to $200 million or more.

“If you can just take a year or even two years off of that timeline, that's saving half the production budget,” said Park.

Studios typically need to make about three times the production budget to break even on a project, taking into account marketing, distribution, and other costs, he said.

Park continued to explain, “One reason why studios are so inefficient is because communication is so slow. Studios have multiple software, in different unrelated silos, that slows everybody down.”

Park's co-founder, Hunter Tinney, is a software engineer specializing in tools for animators. He's built tools for animated films such as Spies In Disguise (2019) and The Bad Guys (2022) at DreamWorks, Netflix Animation and Blue Sky Studios.

Tinney said Palette plans a long-tail go-to-market approach, initially marketing to small to medium sized studios, rather than large ones.

“We are targeting start-up studios,” said Tinney.

He explained that large studios have experienced a difficult year or so with industry layoffs, strikes, and the rise of generative AI.

“A lot of people are going out on their own to create their own projects. And the thing that they're lacking is the sophistication of an enterprise scale studio. They don't have access to expensive project management software like those used by major studios.”

“Most startup studios are using Google Sheets as a project management tool. We're offering something much better. This is a ‘must-have’ for studios.”

Tinney explained the market need that Palette addresses, “Our clients come with certain specific visual creation needs. They need to manage many different clients. Project notes get lost in emails. And even delivering the content is really tricky. We hear stories of people having to hand over physical hard drives to transfer data.”

One of Palette’s beta clients is Angel Studios.

About the relationship with Angel, Park described, “I was a character designer for one of their shows, Tuttle Twins. The production process we used was challenging, but it's not even their fault. It was very similar to all my other experiences.”

“After we had built the Palette prototype. I called them up and said, ‘Hey, we're working on this thing, and we think it will really help the production process.’ They used it and liked it enough to become beta testers. They are going back and forth with us, iterating. We love their feedback.”

Angel is testing Palette for front-end work, character development, etc.

Tinney shared that he was motivated to build a platform for creative artists based on a meeting he experienced at DreamWorks, “In a DreamWorks town hall, the president of DreamWorks declared, ‘it's never been a better time to be a content creator.’ I thought that's such an interesting way to put it…because I bet everyone in the meeting was thinking the same thing…’I could become a content creator. I don't need to be here. I can just go and make my own content because everything's so accessible now, right?’”

The idea of the unleashed content creator stuck with Tinney and motivated him to join forces with Park to create a startup dedicated to building professional tools needed for independent content creators.

Tinney said Palette will grow to meet the demand for that market of content creators. “That's our big bet. We think that it's going to be a growing market and they're going to have an insatiable need for project management software.”

Palette is an all-in-one project management solution for content creators, combining in one software the best and most useful features that creative teams actually use.

Park described it this way:

“Artists and creative teams use three or four different softwares to manage their projects, but we know that they really only use one or two features from each software package.”

“We are combining the most important features of these different software solutions in one place, and we are building it using modern tools. Current enterprise software solutions are outdated, very complicated and overly expensive. We’re stripping away the features people don’t need which makes it simpler, intuitive, and user-friendly.”

Palette also integrates AI project management tools to make collaboration much easier for creative teams. “It is almost like having an AI production assistant. Think about entering a TV script into the platform. It will then give you a report on exactly what you will need: five environments, 10 characters, etc.”

Palette also offers administrative tools that competing software solutions lack that smaller studios have a need for such as tools to handle payments and contracts with multiple vendors and contractors.

Further, Palette is deploying a pricing model that makes sense for the industry it is serving. Palette pricing is based on the duration of the project, rather than on an annual basis. This is how film projects work in the real world. They are calibrated in terms of months, and they don’t necessarily conform to a standard 12 month subscription calendar. As an option, Palette still offers pricing on an annual basis for studios with constant projects.

“It's hard to justify a yearlong subscription for ten people when they’re working on a project for three months,” said Park. “Our pricing model adapts to the project, not the other way around, as it is the case with most other SaaS software products.”

Park said their pricing can start at a quarter of what their competitors charge. And it is based on a freemium model whereby users can access for free the basic project management tools and upgrade to the more advanced features, like the AI tools and additional storage.

Park and Tinney are seeing a lot of interest in their platform. In late October the co-founders attended a trade show in Pasadena for artists working in the entertainment industry—Lightbox Expo, or LBX. A last minute booth had come available and they didn’t want to miss it even though they really didn’t have a full booth set up.

As it turns out, Palette’s booth was located right next to Disney, Pixar and Blizzard Entertainment.

“We only had a black tablecloth, a single laptop, an old TV and a sign that read, ‘Are you tired of Google Sheets?’ ‘Are you tired of ShotGrid?’ 'Talk to us!'"

“We were really surprised because just purely off of those three sentences, we met so many people who were interested in the idea….It's a problem for them, and they want to sign up.
Park and Tinney got hundreds of qualified leads from the show. One of them, a Disney producer, told them, “The moment you guys have something available. I want to be the first to use this.”

Park and Tinney expressed the reason for founding Palette, "The truth is, we're kind of selfish. We just love storytelling in all its forms and want more of it. We hope we can help creative teams bring more high quality content into the world.”

Park and Tinney want to work with creative teams who have dared to go out on their own. They call out to artists and creative teams, “If you're struggling with managing your work, wherever your audience is—film, game, advertising, education, wherever they may be—reach out to us.”