Squarespace’s mission is to help anyone build a beautiful home online.
In 2003, Anthony Casalena was a student at the University of Maryland, College Park. He wanted to build his own website, but was dissatisfied with services available for doing so at the time. None of them offered an all-encompassing solution that would enable customers to do everything from using a site template to adding an image gallery. As a result, Casalena began writing code for software that would act as a one-stop solution. This was simple, as he had taught himself to write code as a teen.
One of Casalena’s friends found out about his program, and offered to pay a few hundred dollars to use it. From this he realized that there might be a market for his creation. So he obtained a $30,000 investment from his father and set about building a business. He used $20,000 to buy servers that he installed himself, and $2,000 to design a logo. Casalena officially launched the company in January 2004, calling it Squarespace. He advertised it through Google AdWords and began selling access.
Strong word-of-mouth helped draw attention for the product and boosted sales. By the end of 2004, it had generated $50,000 in revenues. The next year, that figure climbed to $250,000. Casalena did most behind-the-scenes work (including answering thousands of customer tickets) himself. However, Squarespace’s profitability encouraged him to expand. He began hiring engineers and customer service staff, and by 2010 its size had grown to 30 employees. Investors began to take notice.
Casalena decided to accept help. In July 2010 he raised $38.5 million from venture capital firms Accel and Index Ventures. The funds enabled him to address some rising challenges, such as buying new servers, obtaining credit from banks, and rebuilding his technology platform so it could offer new capabilities – such as support for online retail sites. Casalena was able to raise an additional $40 million in 2014. As of 2015, Squarespace had over 500 employees and $100 million in sales.
Squarespace has a mass market business model, with no significant differentiation between customers. The company targets its offering at anyone who wants to build a website, from regular consumers to artists to entrepreneurs and beyond.
Squarespace offers four primary value propositions: cost reduction, convenience, customization, and brand/status.
The company reduces costs through various features. First-time users are allowed a free trial. Annual subscription accounts receive a free custom domain for a year. Students receive a 50% discount on their first year of use. Lastly, customers can stop their service at any time with no fee charged.
The company creates convenience in multiple ways:
Its reliable cloud infrastructure means users do not have to install, patch, or upgrade
Creating websites is simple and intuitive, only requiring the click of a mouse to arrange content
Retailers can design a quality online storefront without a single plug-in
Site owners can see visitor traffic and behavior in real-time
The company offers customization by providing hundreds of customizable style settings, including colors, fonts, and page layouts. Further, each design has personalizable content areas utilizing Squarespace’s LayoutEngine and Content Block System. Pages, footers, sidebars, and blog posts can utilize all Content Block types (e.g., audio, video, text, markdown). Users can apply Custom CSS to any template through the firm’s built-in custom CSS editor.
The company has established a strong brand as a result of its success. It has more than one million paying customers, including companies in hundreds of industries. These include prominent brands such as Rodate, Tokyobike, V Magazine, Freemans, Lyft, and Fast Company. Moreover, Squarespace has won many honors, including four Webby Awards (2014), the Critics’ Choice CMS Award for Best Website Builder (2013), and recognition as one of Time’s “50 Best Websites” (2012).
Squarespace’s main channel is its website, through which it acquires most customers. The company promotes its offering through its social media pages and online/TV advertising.
Squarespace’s customer relationship is primarily of a self-service, automated nature. Customers utilize the service through its website while having limited interaction with employees. The site features a number of self-help resources, including articles, guides, videos, consumer and developer documentation, and answers to frequently asked questions.
Despite this orientation, there is a personal assistance component provided by the following features:
24/7 phone customer service from individuals with extensive Squarespace experience
Workshops offering in-person guidance on building an online brand (offered at New York headquarters)
Squarespace Circle, a group consisting of significant Squarespace users (those with three or more active websites); they receive perks such as exclusive content (product release notes, advanced guides) and six-month trial periods for new projects
There is also a community element in the form of a peer forum called “Squarespace Answers.”
Squarespace’s business model entails maintaining a robust platform for its customers (it is cloud-based).
Squarespace maintains partnerships with companies that offer services to its customers. They operate in the following areas:
Setup – Partners include Heidi Lakin, Knapsack, Eva Goicochea Studio, PB&J, and Outlaw Creative
Design – Partners include Raygun Design, Vuela Design Studio, and Jenni Schwartz Design
Coding –Partners include 320NY, DCODE, Squeakworks, Square Studio, Sarah Moon, and THEORY
Photography – Partners include Candy Black, The Beauty Shop, Seth Daggett, and SquareFlair
Squarespace’s main resource is its proprietary software platform, which serves more than one million customers. It also depends on human resources in the form of developers for product enhancement and customer service staff for support. Lastly, as a startup it has relied on funding from outside parties, raising $78.5 million from three investors as of April 2014.
Squarespace has a cost-driven structure, aiming to minimize expenses through significant automation and low-price value propositions. Its biggest cost driver is likely marketing, a fixed expense. Other major drivers are in the areas of customer support/operations and administration, also fixed costs.
Squarespace has two revenue streams - subscription fees and transaction fees, as discussed below:
Subscription Fees - Subscription fees charged for access to its website-building platform. Specific options and their pricing are as follows:
Cover Page – Offers a single-page website. Specific features include unlimited bandwidth and storage, a mobile-optimized site, powerful site metrics, a free custom domain with annual purchase, and 24/7 customer support. Pricing is $5/month billed annually or $7 billed month-to-month.
Website – Offers a website with multiple pages. Options are:
Personal – For consumers. Same features as the Cover Page option, as well as 20 pages, galleries, blogs, fully-integrated eCommerce, and the ability to sell unlimited products and accept donations). Pricing is $12/month billed annually or $16 billed month-to-month.
Business – For companies. Same features as the “Personal” option, as well as unlimited pages, professional e-mail from Google, and a $100 Google AdWords credit. Pricing is $18/month billed annually or $26 billed month-to-month.
Commerce – Offers enhanced eCommerce options for businesses. Options are:
Basic – For new businesses. Same features as the “Business” option, as well as a Squarespace website with integrated blogs and galleries, powerful commerce analytics, label printing through Shipstation, and integrated accounting through Xero. Pricing is $26/month billed annually or $30 billed month-to-month.
Advanced – For experienced businesses. Same features as the “Basic” option, as well as abandoned checkout autorecovery and real-time carrier shipping. Pricing is $40/month billed annually or $46 billed month-to-month.
Transaction Fees – Transaction fees charged to businesses for sales occurring through their websites. Those utilizing the “Personal” option are charged 3% per sale, while those using the “Business” option are charged 2% per sale. Those using the Commerce plan are not charged.
Founder and CEO
info: Anthony earned a B.S. in Computer Science from the University of Maryland. He maintains active roles on the design, engineering, and product teams at Squarespace. In 2013 he was named one of “America's Most Promising CEOs“ Under 35 by Forbes.
Chief Financial Officer
info: Nicole earned a Bachelor’s degree from New York University and an MBA from The Wharton School of the University of Pennsylvania. She previously served as CFO of Infor, an enterprise application provider, and held leadership roles at IBM.
Vice President, Strategy
info: Andrew earned a B.A. in Psychology at Yale University. He previously served as Director of Strategy Operations and Business Intelligence Team Lead at Squarespace, and as a Policy Analyst at the New York County District Attorney's Office.
Chief Creative Officer
info: David earned a BFA in Graphic Design from the Rhode Island School of Design. He previously served as Worldwide Digital Executive Creative Director of TBWA Worldwide, President and CCO of Pilot.is, and as a Creative Director at Wieden+Kennedy and AKQA.