Back in 2003, Anthony Casalena wanted to create a website with a blog, a photo gallery and a bunch of other projects he had coded. He was a computer science major at the University of Maryland and started working on his website between classes and homework assignments. After writing maybe one or two blog posts, Casalena founded Squarespace instead. He chose that name because computer monitors used to be square and this was the available space within the screen, plus the domain name was available, and he thought the name warranted a simple logo. The blog hosting service he started as a one-man show in his dorm room has since grown to a company that provides an all-in-one platform for websites. In 2017, it was valued at $1.7 billion.
On Monday, October 22, 2018, Bloomberg Television’s Scarlet Fu discussed Squarespace, entrepreneurship and the importance of website design with Casalena as part of the Cornell Tech @ Bloomberg Speaker Series at Bloomberg’s Global Headquarters in New York City.
Casalena admits that blogging isn’t his forte and, while he gravitated towards the more technical aspects of his website and its design, he found the development process cumbersome. At the time, no one offered an all-in-one solution – he had to assemble different pieces of software on a hosted system, maintain the servers and run his own analytics. Second, he cared deeply about what his site looked like and how it represented his thoughts, because that would be how people perceived him and his ideas.
“I started Squarespace for myself because I wanted those two things, and then quickly realized that perhaps more people cared about those same two things,” said Casalena.
An Innovative Solution to the Problem of Self-Expression
When Casalena started Squarespace, creating a website and putting something online was difficult to do, but blogging, or typing into a box, was something that anyone could do. “We really anchored the company around blogging in the early days and very quickly realized that people were creating blogs [and] websites for all kinds of reasons, and it became an interesting problem,” he said.
Squarespace differentiated itself by providing a technical solution that also took design into consideration. During the platform’s relaunch in 2012, the company intentionally sought to attract a more creative customer base. Back then, the Web was changing and the visual presentation of a portfolio was a challenge, but that style of design could be used for a variety of purposes. “We said, if we can solve for the websites that are hardest to make and the most visually difficult, we can solve that for other people and apply those techniques elsewhere,” said Casalena.
Transitioning from a One-Man Show to a Company
While still a student, Casalena set up the servers, ran the infrastructure, wrote the marketing material, ran the Google AdWords campaigns and coded between homework assignments. He was an engineer, and for him, engineering his way out of problems was easier than learning how to hire people. “I kept falling back on that weakness – or that strength,” said Casalena.
He couldn’t innovate anything though as he was increasingly focused on running Squarespace and didn’t have the time. “I realized I wasn’t making progress,” he said. “So, I decided to change that, and I joined up with some people. We started that journey towards, I guess you can say, I had to learn to become a manager.”
He first hired part-time employees to help with customer support, and then he hired people to work on designing website template. What helped Casalena recruit was that Squarespace had traction from the start and it had received investments about seven years in from Index Ventures and Accel Partners, two well-respected venture capital firms.
“A lot of people who might have been a little bit more skeptical about joining my solo little entrepreneurial show were at least comforted by the fact that these two world-renowned firms with good reputations were willing to go under the hood and [provide validation],” said Casalena.
He’s still very much involved in the company’s mission and vision and ensuring that teams deliver results. “I don’t think you can delegate the DNA and the building of the DNA,” he said. “I think that that’s up to you to figure out who’s in and who’s out and what configuration people are in. I don’t think there’s anyone on your team that can just figure that out for you; you’ve got to pick that.”
Financial Models Aren’t One-Size-Fits-All
Squarespace is a late-stage private company and Casalena often thinks about operating within limitations, especially from a financial perspective. He disagrees with venture capitalists that encourage founders to raise as much money as possible because they have a great service or product – or when financing is cheap.
Some businesses are very capital intensive upfront – they have a burn rate and need runway – but no one wants to operate in a situation where there’s financial uncertainty three months down the road. Squarespace has essentially operated as cash flow break-even from the very beginning. “I didn’t really need to raise, in my view, outside capital,” said Casalena. “For a while, it was just me running it, so it was a build, a reach to a level where you’re always generating a good amount of money.”
The financial discipline to keep the company at break-even stopped Casalena from raising money that he probably would then have felt compelled to spend. “Also, if you don’t know what you’re going to do with the money, why would you suffer the dilution?” he said. “It doesn’t add up to me. When we have raised money, it’s been for very specific reasons.”
In the meantime, Squarespace continues to innovate and move forward. “While a lot of our values are the same as when we started as a blogging platform, we’re much more than a blogging platform right now. At various junctures, it’s got to be okay to say, ‘We’re going to do more,’” said Casalena. “Our ambition can evolve.”
You can watch the entire discussion below: