Why would anyone make a website in 2023? Squarespace CEO Anthony Casalena has some ideas
We celebrated our 20th anniversary in April. So we’re used to a web, pre-social network phase, almost pre-YouTube, pre-iPhone. The predominant browser was Internet Explorer. So we’ve seen a lot. Blogging was a word I used to have to explain to people what it meant when Squarespace launched. So we’re no stranger to change on the web. It’s with that that I’m actually super excited about what it means for the future.
So a lot of what we’re focused on is, one, fundamentals, just being the best place to go for a website in terms of ease of use and expressibility, but also really helping our customers make businesses, helping them transact and really being part of the future of entrepreneurship. That’s a split for me that is particularly interesting, that the growth and the activity is happening. You’re running your business, and people are going to sign up, or they’re going to book calendar slots, or they’re going to buy something from you. You’re launching a payments business in the fall. All that is away from you’re going to start a website. There’s a break there that I think is just utterly fascinating.
So if you’re really locked into an audience there, if you’re serious about what you’re doing at all, that becomes dangerous. That being said, they’re great for distribution. We encourage all of our customers to be on whichever social networks are relevant to them, including incredibly niched ones depending on where people start power washer businesses and how they all interact and collaborate.Yeah. It just feels like that is such a creation of TikTok.No, but that’s so wild to me.
As you might imagine, it’s in transition. It’s always in transition in some ways, but really, this move from just the brand Squarespace to these other brands within a portfolio — and it’s not that many of them, and they’re hung together in a number of ways. They’re all in service of entrepreneurs, and they’re shared services like our payments platform, which you mentioned that they’ll all use together. We just started buying these brands and launching them probably only four years ago.
One of these days, I’m going to have a CEO tell me that they’ve decentralized HR, legal, and finance, and I think that might be the end ofNo one does it. It’s the one thing that everyone definitely centralized, but the difference is where do you put design? Where do you put product? Where do you put marketing? And everyone seems to have very different opinions about this stuff.
When I look at the chart of other big website companies, Automattic / WordPress, I guess Automattic is a holding company.. WordPress obviously dominates the internet. 64 percent of websites are on WordPress. Then there’s Shopify, Wix. Squarespace around 3 percent.
So by transaction volume, you mean you’ve got, I don’t know, all the dentists in New York, and you just want them to do more dentistry? You wanted to help them market to more customers? First off — once in a lifetime opportunity for us. Incredibly grateful that we were selected as the stewards of that business. We weren’t asking them, like, “Hey, planning on shutting down domains or anything?” It wasn’t exactly outbound. I think they made the decision that it’s not a business that they were going to be in.
Then the other thing in my mind is, and this is funny: I’m a Google Domains customer. I use Google Domains, and I’ve had a number of domains there for over a decade. Why is that? Because Squarespace started very website first and then added domain second. It’s very valid to get multiple domains on Squarespace now, but just due to inertia and Google Domains being a good product, I had left a couple of domains there.
I think to answer your question more broadly, depending on what the thing is, it generally starts with a much smaller group of people, and then I widen the concentric circles to either stress test the idea or get more people aligned with what we’re doing. Google Domains was no exception to this — had to start with a small group of people because it was so confidential. Then we did that, widening concentric circles. I get more buy-in.
I think after getting into the cadence with the quarterly earnings — I think it brings a discipline to the company that I wouldn’t say we didn’t have before because we certainly prepped for two or three years before going public, including having mock earnings calls and everything else. This wasn’t a giant surprise, but I actually think it’s been a really good thing. The employees can get liquidity. Investors can get liquidity.
How has it changed your decision-making now? It’s been about two years. Have you perceived, “Okay, I’m making decisions more slowly or more guarded”? Has there been effect that you can call out?People always seem to want to get into this, “Oh, well, they’re going to do all these short-term things to meet the quarter,” or something like that. There aren’t that many short-term things I can do to meet the quarter. We’re not like a Salesforce basis. There’s not any tricks.
We’ve had some form of AI-powered support for four or five years now that we’ve been training on our own data sets and getting better with. This will be an evolution on top of that. That’s super exciting. I talked about this extensively in my last earnings call because it was such an overnight interest in all of this. I’m actually not as worried about the impact of the LLMs and Squarespace’s core business for, frankly, a number of reasons.
That’s a pretty interesting compare and contrast, given your history. I remember when the first WYSIWYG web design tool showed up, and they basically output bad code. It was just bad, HTML was sloppy all the way around, and the old-school web community was like, “This is garbage,” but eventually, the WYSIWYG editors won, the visual web design systems all won, Squarespace won, and yes, some people still hand code their websites and I love them. They’re my people, but—...
So to be clear, we currently have in production the ability for you to auto-generate text using, in the background, is called OpenAI, and there are LLMs, and we make that accessible to all of our customers right now. Now, if you were trying to, as you put it, flood the web with text, using Squarespace would probably be a pretty bad way of doing that.
I think it’s really interesting to think about how the web and private data even will flow into these models and for which examples the LLMs will be a better alternative to search and one that’ll be a worse alternative to search.
Not to make a joke about it, but what if the AI-generated stuff is better than some of the human-generated stuff?I asked this because this seems like where you would impose a regulation. It’s on a vendor like Squarespace that’s making the webpages.
There comes a point where the car dealer is going to say, “Look, I am tired of paying for anyone to write this copy. Just have the intern write me five paragraphs for installing a booster seat and put that on the Squarespace page,” and that will be easier and cheaper at scale for more businesses to do for more things. Eventually, that stuff will get indexed into Google, and that will be a recursive loop that leads to bad outcomes.
So when you talk about copy, or you talk about image generation, first off, there’s a lot of things in that realm that are totally unique and a unique story. You might start with somebody helping you with the paragraph, but you need to write more. Secondarily to your car dealership example, how do you know which one’s good? Well, probably you have some human filter for, like, “No, that’s actually a picture of the real car dealership, I think.
Actually, I wish I had a better answer for you on that because it would probably depend on the segment. For some segments, it might be Google and Google rankings. As you know, for certain keywords, there are very few sites that rank for those. Obviously, Squarespace sites is too great at Google. We’ve been around for two decades. We know about SEO, but depending on the personality, a lot of your traffic might come from your Instagram page. It might come from where you have a following.
Well, I’m just curious because you can have a website. Your website’s not worth a lot without traffic. So a lot of my silly car dealer examples or whatever, they’re just trying to get traffic. They’re looking at what people are searching for, and they’re firing out content to just try to get one click onto their website in the search result. Google is the last big funnel of traffic from what I can see. Maybe some people have links on their Instagram page or links on their ...
There are some examples where that might be the case, but a lot of the complex things need to occur. It’s still happening at a URL somewhere at some point because there’s a lot of backend logistics, and a lot of things need to happen. A lot of delivery needs to happen, and it has to hit an end point somewhere.
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