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Key Developments at OpenStore

OpenStore, a company that buys Shopify brands, is branching out into software. They've created OpenDesk, an AI customer support tool for Shopify stores. This move shows how OpenStore is adapting to changes in e-commerce.

I've learned that OpenStore owns about 51 Shopify brands. They built OpenDesk to handle customer service for these brands. Now, they're offering it to other Shopify stores. OpenDesk uses AI to answer customer questions automatically. It can handle about 71% of inquiries without human help.

OpenStore thinks OpenDesk fills a gap in the market. It's made specifically for Shopify brands and has been trained on data from many different types of stores. This broad experience could give it an edge over other customer service tools.

The company is changing in other ways too. They've recently laid off about 20% of their staff. They're also being more selective about which brands they buy. They're looking for brands that could grow much bigger, rather than just slightly improving many small brands.

Here's a quick look at OpenStore's journey:

• Founded in 2021

• Raised about $150 million

• Initially bought multiple companies per week

• Targeted brands making $500,000 to $10 million yearly

• Now owns about 51 brands

OpenStore's shift comes as e-commerce growth has slowed. Many startups are cutting costs due to inflation and high interest rates. Some other companies that buy up e-commerce brands have struggled. For example, Thrasio filed for bankruptcy in March 2024.

OpenDesk has a pay-as-you-go pricing model. It's aimed at smaller brands that find other customer service tools too expensive. This makes sense given the Shopify market. OpenStore estimates that 85% of Shopify stores make less than $50,000 in revenue.

I think it's worth noting that selling software to Shopify stores isn't easy. There are already many apps available. Most Shopify stores are small, so any new tool needs to be affordable. With e-commerce growth slowing, stores might be less willing to try new tools.

OpenStore has seen big success with one of its brands, Jack Archer. It's a men's athleisure brand that's expected to make over $20 million this year. This success has influenced OpenStore's new strategy of focusing on brands with high growth potential.

The company sees the millions of small Shopify stores as a big opportunity. They're hoping OpenDesk will help these stores improve and grow. It's not clear yet how much of OpenStore's focus will shift to software in the long term. That will depend on how well OpenDesk does with customers.

OpenStore's move into software is an interesting development. It shows how companies in the e-commerce space are adapting to changing market conditions. By creating tools based on their own experience running multiple brands, they're trying to find new ways to grow in a challenging environment.

Adobe's Firefly AI in Premiere Pro: Revolutionizing How You Edit Videos

AI Video Creation Advances

Adobe has unveiled its new Firefly Video Model, bringing generative AI to video creation. This technology introduces exciting possibilities for content creators and editors.

I've learned about several new tools that are part of this release. One standout feature is Generative Extend in Premiere Pro. This tool lets editors stretch footage by up to two seconds at the start or end of a clip. It's great for small adjustments, like fixing eye-line issues or unexpected movements.

Here are some key points about Generative Extend:

• Extends clips by up to 2 seconds

• Works at 720p or 1080p resolution

• 24 frames per second output

• Can extend audio for sound effects and ambient noise (up to 10 seconds)

Adobe has also launched two web-based tools: Text-to-Video and Image-to-Video. These are now in public beta on the Firefly web app. Text-to-Video lets users create short clips from text descriptions. It can mimic various styles like real film, 3D animation, and stop motion.

Image-to-Video adds another layer of control. Users can upload a reference image along with their text prompt. This could be useful for creating b-roll or visualizing reshoots.

Some limitations of these tools include:

• Maximum clip length of 5 seconds

• 720p resolution

• 24 frames per second

Generation time for all these tools is about 90 seconds. Adobe says they're working on a "turbo mode" to speed this up.

A key selling point of Adobe's AI video tools is their commercial safety. The company claims they're trained on properly licensed content, which could be a big draw for professional users.

Another interesting feature is Content Credentials. Videos made or edited with Firefly can include embedded information about AI usage and ownership rights. This transparency could be valuable in an era of increasing AI-generated content.

I think it's worth noting that while these tools are impressive, they're still in early stages. The short clip lengths and resolution limits mean they're not ready to replace traditional filmmaking methods. But for quick edits, generating ideas, or creating short-form content, they could be very useful.

Adobe's approach seems to focus on integrating AI seamlessly into existing workflows. By adding these tools to Premiere Pro and their web apps, they're making it easy for creators to experiment with AI without completely changing their process.

The AI video market is heating up, with companies like OpenAI, Meta, and Google all working on similar technologies. Adobe's advantage might be its established presence in the creative software world and its focus on commercial viability.

Here's a quick comparison of some AI video tools:

It's clear that AI video generation is still in its early days. As these tools improve, we might see longer clips, higher resolutions, and more complex editing capabilities. For now, they're best suited for small tasks and experimentation.

I'm curious to see how creators will use these tools in real-world projects. Will they become a standard part of video workflows? Or will they remain niche tools for specific use cases? Only time will tell.

The release of these AI video tools is part of a larger push by Adobe to integrate AI across its creative apps. It's an exciting time for digital creators, with new possibilities opening up almost daily. As these technologies evolve, they could reshape how we think about video production and editing.

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Cheers,

Darius @ SumoGrowth