Why Prisma is the Russian Pied Piper from Silicon Valley 

The Prisma application was released on June 11, and four days later, after the media paid attention to it, the images processed in it filled the social networks. On June 21, Mail.Ru Group announced an investment in Prisma Labs. Prisma Labs co-founder Alexei Moiseenkov gives one interview after another, and his startup more and more resembles an exemplary success story worthy of Silicon Valley. Such as Pied Piper – a fictional, but more than close to reality startup from the TV series “Silicon Valley” HBO channel.

Of course, seriously comparing the non-existent Pied Piper and the real “Prism” would be foolish, but for this there are at least two good reasons. Firstly, Silicon Valley is a comedy series , but very close to reality . He is advised by real insiders of IT companies (for example, the former Twitter CEO Dick Costolo), sometimes there are well-known entrepreneurs (up to Google founder Larry Page), and characters and companies from the series – Richard Hendricks, Gavin Belson, Pied Piper and Hooli – have very real prototypes.

Secondly, Pied Piper reflects everything that is called the American dream in transference to the realities of IT startups: no one known smart guys under the leadership of a modest developer and leader Richard Hendrix made a multi-million company from scratch, overcoming various difficulties that they themselves often created for myself. Prisma can also become such a startup, and many believe it: their seemingly uncomplicated photo application is the first Russian product in a long time, which so quickly achieved success and is capable of entering the international arena.

The substantial differences between Pied Piper and Prisma are obviously complete, but we will try to draw parallels and explain to them what the secret and main problems of the Russian application are.

Carefully, there are spoilers.

Free cloud service

According to the plot of Silicon Valley, Pied Piper is a cloud storage and compression service for any data: an analogue of Dropbox, but only very effectively using space due to complex algorithms. All data is stored on the Internet, or rather, scattered on user devices, so that they are also a peering information delivery network.

Image processing in Prisma has nothing to do with photo filters: it is not a superimposition of one image on another, not a modification of contrast or color balance. This is a complete redrawing using a complex algorithm, and this requires a lot of power, so all the processing takes place in the cloud too. Users just upload a photo, and in return they get a picture drawn in a given style.

Both Pied Piper and Prisma are free – and if the first has not yet just come up with a monetization model, then the photo application does not seem to be going to force users to pay at all: “For the end user who downloads the application, most likely nothing will ever be paid.”

Neural networks

Pied Piper has a complex data compression algorithm, due to which the download and download of information occur much faster than in conventional cloud services. Moreover, with each user, the quality of service increases: neural networks train the algorithm to understand when it is better to compress various types of data.

The main merit of the creators of Prisma is that they were the first to make a clear and simple, and most importantly demanded, mobile product based on neural networks. A year before them, only scientific papers were published on this topic, and all the algorithms for processing paintings of famous artists existed only on GitHub.

Nobody says exactly how it works.

For a long time, Pied Piper tried to keep secret the algorithms used for data compression. Largely due to their exclusivity, they won TechCrunch Disrupt and received the first investment, and then the competitors stole the formula and started making a clone of the service.

Prisma co-founder Alexey Moiseenkov tries not to spread about how the service works. In one of the first interviews on the “Rain”, he said that, unlike competitors, Prisma uses a kind of “mathematical trick” to process images faster. For example, it took from Ostagram that appeared in December from a minute to a day, from Mlvch – from two to 20 minutes. For Prisma, this happens in seconds, but for such a speed, huge capacities are needed – the company adds new servers every day.

A startup was born in the depths of a large company.

At that moment, when the hero of the series Richard Hendrix began working on Pied Piper (originally intended as a music application), he was an employee of Hooli – a fictional company, a mixture of Google and Facebook in one bottle. He developed his project in his spare time in a startup incubator, the programmers from whom became the Pied Piper team.

Alexey Moiseenkov worked at Yandex on mobile cards, and then for a year in (owned by Mail.Ru Group) on a mobile mail client. In the spring of 2016, he, together with a team of former colleagues from Yandex, started creating Prisma in his spare time. Moreover, the Mail.Ru Group holding is very similar to Hooli in terms of the scale and diversity of its activities.

As in the case of Pied Piper, the background of the other members of the Prisma team is unknown, and Moiseenkov himself speaks publicly on behalf of the company. He even looks like Hendrix, who modestly distributes the first interviews to television channels. The only thing that is not enough for completeness of the parallel is the self-confident and boorish partner of Erlich Backman.

Exciting investor relations

Pied Piper survived a difficult period of communication with investors before their relationship stabilized. In order to become an investor in Pied Piper, several players fought at once: in the end, Hendricks chose the option when he gave only 5% of the shares from the $ 4 million valuation, and did not sell the company for $ 10 million, as suggested by Hooli founder Gavin Belson . One of the founders of the startup went to the competitors in Hooli: those almost managed to use it to sue the technology from Pied Piper, and Richard Hendrix’s company almost spent the first money on lawyers.

Mail.Ru Group also had to compete a bit to enter the company of its now former employee with investments. Outwardly, all this was happening in the confusion: the application quickly fired, yesterday’s employee called herself a former employee, Mail.Ru defiantly tried to keep in touch, and in the end she succeeded. According to RBC , we are talking about buying a small share: one source says about 10%, another – “significantly less than 25%”. But the initial estimate is the same – about $ 10 million.

Quick start, but not without problems

In the third season, porridge in the head and the company of Richard Hendrix finally turned into a tangible product: Pied Piper launched a beta version and began to rapidly recruit new users. He was even allowed to go to the app store Hooli, and the download counter in a few days reached 500 thousand. However, the opposite side of the medal immediately manifested itself: due to Pied Piper’s “geekiness,” the people who used it quickly fell off, and the number of active users turned out to be insignificant — about 19 thousand people.

For five days (from June 16 to June 21) Prisma received over a million downloads and went to the top of the App Store in more than ten countries. Moiseenkov in his interviews does not give specific figures on the number of active users (he is not asked such a question), but in a conversation with he stated that their number is more than large: about 300 thousand people download the application per day, and 99% launch it downloaded.

Prisma has another problem: an exponentially growing number of active users makes it necessary to increase server capacity in the same way. In any case, the company even tries to artificially restrain growth, so that some Kim Kardashian would not make the service inaccessible for everyone at once by one post on Instagram. On the evening of June 21, Prisma even turned off the “filter” in the style of Marc Chagall: Moiseenkov explained this by saying that the “filter” created a particularly high load, but it would soon be returned when the service calculations were made more efficient.

Will Prisma go to Silicon Valley?

The main question that torments everyone who follows Prisma’s fate is whether the startup will sell to some western giant, as Belarusian MSQRD did . Moiseenkov does not exclude the possibility of such a sale, although he does not confirm the rumors that Western investment funds have already negotiated with Prisma.

[perfectpullquote align=”full” bordertop=”false” cite=”” link=”” color=”” class=”” size=””]I would not say that I’m going to go there: this is rather an opportunity and a question of necessity for the further progress of the service. If you need to go to the Valley to move on, I’ll go.[/perfectpullquote]
Alexey Moiseenkov, Prisma co-founder (quoted by RBC)
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