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Photo-sharing app Tinybeans (ASX: TNY) is set to almost double its subscriber base following a US$2.7 million ($4.1 million) scrip-based acquisition of US-based Qeepsake Inc., a digital memory and family journaling platform.
Tinybeans, which is chaired by former CEO of Seven West Media James Warburton, says the merger of operations will grow its subscriber base to about 90,000 on day one – up 80 per cent on the 51,000 recorded at the end of FY25.
“This is a transformational step for Tinybeans,” says Warburton, who was appointed chair of the company in December last year.
“The acquisition of Qeepsake nearly doubles our scale, strengthens our US presence and accelerates our path to profitability - all in a highly capital-efficient way.
“The transaction delivers substantial growth without the need for cash outlay and reflects the disciplined execution of our strategy to build a larger, more efficient subscription business.”
Qeepsake was founded in 2015 by husband-and-wife team Jeff and Stephanie McNeil as a memory-keeping app to preserve moments in their children's lives.
The Sydney-based Tinybeans was established by Sarah-Jane Kurtini, Eddie Geller and Stephen O'Young in 2012, but the company has since expanded into the US which has become its fastest-growing market.
Tinybeans says the acquisition provides extensive synergies for its business which operates a social media platform used by parents as a journal, visual diary and time capsule for their families.
The US$2.7 million acquisition is priced at 0.66 times Qeepsake’s FY25 revenue and Tinybeans says the deal delivers a sharply higher subscriber base that is “materially below Tinybeans’ organic subscriber acquisition cost”.
“Qeepsake is a natural strategic fit for Tinybeans,” says Zsofi Paterson, the CEO of Tinybeans.
“Together, we’re creating the leading privacy-first family memory platform - combining Tinybeans’ photo-sharing experience with Qeepsake’s journaling know-how to deliver an even richer experience for families.
“While we expect some natural subscriber movement during integration, which will be disciplined and focused, the scale, product fit and cost efficiency of this transaction give us confidence in delivering sustainable growth for our shareholders.”
Tinybeans says the deal adds high-value recurring subscription and transactional revenue to its business, with the company targeting combined pro-forma FY26 revenue of US$8.9 million ($13.6 million) - up 85 per cent on the FY25 result.
The company experienced a turnaround in fortunes over the past year following a leadership transition announced in mid-2024.
Warburton joined as chair in December last year, replacing Chantale Millard. With the departure of Catherine Cohen as non-executive director, Paterson was elevated to managing director and CEO, joining Warburton and US-based non-executive directors Mike Rothman and Andrew Silverberg on a slimmed-down board.
While the company posted another underlying loss in its latest financial results, the FY25 adjusted EBITDA loss of US$1.44 million was a 60 per cent improvement on the previous year – a result boosted by cost reductions.
Tinybeans says the Qeepsake acquisition cements its position in the digital family memory market and strengthens its presence in North America's lifestyle technology sector.
Qeepsake’s journaling features are said to complement Tinybeans’ photo-sharing platform, broadening product appeal and enabling new monetisation opportunities across a larger and highly engaged subscriber base.
Tinybeans plans to integrate Qeepsake’s journaling features and migrate subscribers into its platform through FY26, targeting the retention of about 40,000 existing high-value users.
The acquisition is aimed at accelerating Tinybeans’ path to EBITDA profitability, which the company says will be aided by cost discipline, integration synergies and a scalable subscription model.
“We’re delighted to see Qeepsake joining forces with Tinybeans - a company that shares our vision for helping families capture and preserve their memories in a safe, private and meaningful way,” says Cliff Sirlin, the chair of Qeepsake.
“Tinybeans’ platform, scale and leadership make it the ideal home for the Qeepsake community and we’re confident the combined business will create even more value for families and shareholders alike.”
Tinybeans’ shares closed 16 per cent higher at 11.6c each on the ASX today.
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