How to Pinpoint What Powers Your Growth with Avishai Abrahami of Wix

The basic concept came from my co-founder and my brother came and said, well, you know, it's very hard to build websites. And they actually sent me to try because I didn't believe them. And it was very clearly in the beginning obvious that you had tools like FrontPage and Dreamweaver, but it was so technical, you needed to know how to program in HTML. And on the other hand, you had tools like Yahoo and stuff, they were building terrible websites, like ugly websites. And there was nothing that allowed you to draw a website, to design. And then we said, well, it's 2006, you know, the internet exists for 10 years now, it doesn't make sense. There is a place for us to make this massive disruption and that will actually change how people interact with the web, so everybody can build amazing content the way they would use a design software for that instead of programming. And then that was the moment when we realized that there's a massive thing that is missing and that so many people around us would actually use it.

Yes.

And I've seen it twice, right? I've been involved in the founding of two companies, Wix and Matomy.com. And I think it's very hard to push a market. You need to create a pull for the market, for the product, right? It's very hard to take a product and to market it and to create a product. You need people to like the product and want to use it, and then they have the ability to show and share with their friends what they did, right? And I think in Wix we got it very well because fundamentally we were a design software, right? You could come in, drag and drop things and make them. But the fact that you are proud of what you did and it was so easy to start, right? It created a place where people were just talking about it and sharing with their friends. And the number one referral for the first couple of years was mail.com, right? Meaning people would just send it to each other over the email. And we would get that as a number one referral for weeks. And all of it only happened because people are very proud of what they built. And in Monday it's very similar, the fact that people could create these amazing boards and share it with friends and show how quickly to do something amazing, right? It generates that viral effect. If you look at viral effects, right? Then the number one viral effect, of course, is social networks where to use the product you need to invite your friends to come. And so that's like the top. And there is a level below that which are products like ours, which would be something people are proud of to talk to friends about it, to present it and explain it. And then that's where the viral effect, right? So there are two different levels of magnitudes. And I think below that you have everything that you need to actively sell.

One of the things that we really try to do is always have conversations with our users. And slowly, right, kind of like slowly over time, we've seen that people were, you know, building their website, they were like, okay, can I get contacts? Or I want to sell this product? Or I want to run an event? And so we started, like, we actually did a pilot with hotels and we started to build this additional functionality into Wix that enabled us to allow them to run what they wanted on Wix. And the demand for that, it kept growing and growing and growing. And so by doing that, right, and this is something I think is a very interesting thing, is that we actually increased the addressable market. Right? Now we became available in terms of functionality and offering to more kinds and more types of users. And that created this chain effect where every time we add something, we get more requests around it, more requests around it. And at some point you just become a fully management SaaS for your business. Again, we're now focused. You're not going to do the accounting on Wix, right? I hope not at least, because we're not really any value in that. And for a lot of things we just need basic offerings. If you want, starting from running like email campaigns, we need the basic offerings so you can do it in Wix. And for a lot of people that's enough, but upgrade from that to a professional product. But I think that kind of path where we always have those conversations with our customers to what more they want to do has allowed us to create a business with.

In 2016 we launched ADI, which is Artificial Design Intelligence, which was an AI that actually built a complete website for you. And so it was, you kind of see those finals a lot. A lot of people now are building those website builders like us and they're very similar to that initial product. And it was a big success because it really allowed somebody to come to Wix, describe what they want to do, answer the prompts, you choose the menus, you choose this kind of business, you write a bit, we search the internet, find content, and we created a website that is still made for you. And you could do that in, I don't know, a span of 10 minutes instead of work of three days. And then you would go into the Wix editor and continue to customize it from that point. I think that was really a good product and as you said, a bit ahead of its time. In fact, most of the team was always concerned about the fact that we used AI, the meaning the wording of AI in this product. And by the time they managed to completely eliminate it, okay, ChatGPT freaked them out and everybody wanted AI. So they were slowly removing it, oh, that's going to scare our users. But I think that in terms of how the product itself behaved, it was just a way for you to go in, answer questions, and write a bit of text, and we would just build a website for you in there. Where text AI will take us, of course, but I just want to say that of course the first thing we did when new technology came is upgraded our algorithms with better algorithms, right? So I think about two years ago we replaced the text generation, which was very naive, to ChatGPT version three, if I remember correctly. Beginning, it was even before 3.5 that everybody knows. And we of course now working on image generation, we continue to upgrade that. The thing is that for self-creators, reducing the friction and effort of when they try to build content is a tremendous value, right? Because all of the self-creators, they come in Wix and they want to take their story and put it on the internet. But it has to be around them, right? You cannot just generate it with like, oh, make me a website for... because you want the photos to be yours, you want the content to be yours, you want the style to be yours, you want your message, your story to come out of it. And AI allows us to simplify that, right? To find better ways for you to tell your story and share your vision with the world. And every time we manage to reduce that friction, we improve conversion, we get more happy customers, they tell their friends, right? So this is for us always been a key success factor and will continue to be.

Oh my God, it's a lot of things and probably a lot of them will not be true. But I think the number one thing that I do believe is that a lot of how we communicate with computers will change and dramatically change. If you look at AI and search engines and the ability to talk to a computer today and ask it to give a summary of things or to do something, I think that will dramatically accelerate. So all the interfaces that we have, I think will change, and all the UI that we have today, I think will change. And I think that's a great thing because we kind of learned how to use this computer UI which takes a lot of effort to do small things. And I think now we're going to have it being replaced by the ability to ask for something. I want to see a list of hotels, I want to book this one, I want to do this, I want to do that, and get this massive information and help from the computer. And be very interesting to see the ChatGPT integration to iOS, think that how much they actually manage to create a place where you can actually ask it, please do this for me, right? And it actually works, right? The current beta is not as impressive as we would have imagined, but there's no doubt in my mind that it goes this way. I do also believe that when it comes to computers, we're about to hit this place where more investment into the current algorithms of AI will not justify the investment. Meaning that we're going to see that LLMs become a commodity. Absolutely. I don't think anybody can actually point out what is the difference for themselves, unless it's your profession, between GPT-4, whatever generation it is now. It might give you some better answer in some way, but nobody can actually notice that. And we're almost at image generation, we're almost at the point where it's meaningless to be better. Yeah, they still do some, but it's like this is like the last 3%, the 97% of the effort is behind us. And videos will come soon. I think it would be a very interesting world where it's impossible to distinguish between what was real to what is not. And my wife did a presentation for a colleague of hers, and in that presentation it's all about him in different situations. There's one image that is actually his, everything else was AI-generated. And I tested it on my parents, asked me which image do you think is real or not, and they thought that about half of the pictures were AI-generated and half were not. So we are getting to that place. It'll be very interesting to see how we as humans behave in a world where it's impossible to know if something is real or just fake.

There are so many people working on quantum technology. I think that's a radical change for humanity, essentially. If you think about every time new physics became something that moved to the realm of engineering, the human race was transformed. That is probably true from a kinetic force with a wheel and pots, and then before that, fire, steam engines, right? Electricity. The time it took to create the first computer, I think from the, if I remember correctly, from the time there was a light bulb, what, 50 years? If I think so. If you go back in time and the moment where they turn on the first light bulb and they said, well, you know what, this can be cool, we're going to need a lot of engineering to understand electricity because everybody's going to want to have one of those at home, right? And a lot of engineers start electricity, the speed of transformation was incredible. But also there is no way to predict what this new physics that's becoming now a tool for engineering is going to achieve. And we are in the middle of this thing, right? Which is engineers learning quantum. And we're already seeing something coming out of it, which means more engineers will learn quantum. And this is a completely new physics, like every other physics. I think it's impossible to predict what's going to come out of it. And I believe that we're going to see the next decade and the decade after that an incredible amount of invention that will come out of it. And I think it will completely transform the physical world as we know it.

I don't like when people simplify too much, right? I come to the company and they'll show it, they have only 10 things to measure. And I'm like, okay, they don't know what they're doing. That's my opinion. They have to have cost of advertisement, right? And then they have to have conversion, then they have to, which ad is working, which is not. And this is before we even enter the product, right? We have like 10. So it's impossible that you only measure 10. And so yes, I have about, I think, 130-something pages that they review on a monthly basis and about 30 that they review weekly. And I think look at everything else and will tell me when something is changing. But we want to know about conversions, customer satisfaction, what a customer is looking for, what are you trying to do, where do you get stuck. You want to know if the products are working well, you want to know the performance of the product, you want to have all of those things in a way that you can actually look at it and make sense out of it, even if it's only to be sure that you didn't screw up or didn't go back on one of the KPIs. And even that they do watch all of those, a lot of time I actually miss things and it's always a disaster. I think that most young founders that I meet don't feel that way is because they didn't even know that the disaster happened, right? Because they never measured. They don't know that, oh my God, customer support is missing all those deals or a lot of other things that are happening and they don't see. So I think the more you measure, the more visible your issues and opportunities are. And the opportunities are what you're really trying to find. We would never be able to build the business application if we didn't watch and measured what our customers are trying to do and why they're asking for it. And this is just one example.

If I enter a room with Wix and I feel that I'm the smartest person in that room, I think that I failed terribly in hiring. I mean, my number one goal is that every time I go to a room, I always think, oh my God, those people are so much better than me, or like, there are brilliant people here, okay? And not the other way around. And this is for me the number one most important criteria when you hire. And brilliant doesn't necessarily mean intelligence, right? Some people are amazing designers, but I want to come and say, well, they're incredible at what they do, I have no chance to compete with them on what we want them to do. And the way we've learned that the best way to qualify that is by testing people. So we test everybody, everybody. If you work at the C-level in Wix, we'll test you. Because we kind of identified that the number one thing we wanted from most people in the C-level was the ability to identify the talent of others. So we actually came up with a test where you will let candidates for a job interview people that already work at Wix, and then we know the answer. And then we say, well, they were right, they were wrong. And this is how we're able to detect talent.

If you can do that, you can do anything, right? Everything. And there's nothing you cannot do because if you bring a lot of talented people together and you give them a clear goal, amazing things will happen without you as a manager needing to do too much. But if you bring a lot of average people and put them together in a room, and even if you put inside a few smart people, you'll never get anything brilliant coming out of that room because you don't have the brilliance in that room. It's in a different place. That is the number one, that's the most important thing to focus on when you're hiring, especially in the early days. And then as you go on, you need to ingrain in the company the culture of doing that.

When I started programming, I was 11, so that was '82 or '83. And I had to learn the internals of the computer and how computers really work. And there was nobody here in my country that I could learn how to run a project or to think about programming. I had to invent all those things. And of course, a lot of them I did really badly. But the fact that I kind of learned very early exactly how a computer works and the ability to sit and think by myself about a problem for a while, right? And then when I finally met people that actually have the skills, I was so amazed by that and had so much desire to learn. And I think that shaped me. I think that one of the first things is learning how a computer works. The other one is the ability to sit and think about a problem by myself for a few hours and not rush to it, not use my intuition, actually go for a logical process and think about it and understand what I imagine to be true and what is true. And the other thing is that I love getting feedback. And by the way, there's one quality that I've seen that is true for almost every successful founder, is that they are the fastest people I ever met in getting feedback or the most hoping to get feedback. They don't always agree with it, right? But they will always love to get that interaction. And that interaction is what enables us, I think, to become better. And that betterment makes you able to make your company better.

I think the first thing is the thing that you said, is that quality of lean into pain, right? And the ability to get feedback all the time and desire to prove yourself and learn more all the time. That's by far the number one, right? Great companies are not great companies unless they are better every day, right? A great company has to improve every day to be a better company. That's what makes a better company, a better company. It's not the static state. I think that's number one. The other thing is that moving from 0 to 60 immediately, meaning that speed of acceleration into a new project. And that is another thing that I've seen that founders, they don't have this like, oh, you know, I have this idea, let's sit on the sofa, talk about it to friends, let's watch a movie, let's go do that. No, it's like they have something to do, want to do it now, and they start doing it. Okay, obviously a lot of stubbornness, resistance toward outside influence. I mean, that's another one. I think those are the bigger qualities. I think the other one is actually this ability to actually, you remember the story that is about the king's new clothes? Yes. Where the kid that screams the kid is naked. I think most great founders are that kid. They don't listen so much to the crowd, they mostly focus a lot about their experience. You cannot generate new things if you always let the voices around you influence your thinking. And every big mistake I made, and it's my mistake always, right, was listening too much to what people around me were saying.

I think that all of us have to find our ways of doing that. You know, when we started, I used to work 18 hours a day. And the other thing that I learned is that now I learned how to pace myself, right? So I sleep about six hours a day, I have about six hours to be with my family and to play a bit of computer games or do something that I want, train, and then I only work for 12 hours, right? So I actually feel that I have a lot of free time. And I think learning that was number one for me to be able to survive for this. And I try not to do so much work on the weekend anymore. I throw in a few hours if you want every day, but not more than that. And I'm a strong follower of Stoicism, if you're familiar with that. Epictetus. So like, stress is an emotion, it's not more than that. It doesn't really affect you if you don't fight it back. It's okay to stress. Life is stressful. There are a lot of times stressful things happen around you. But I think number one thing is to understand and to accept it, and then to come up with a plan of what you want to do about it, right? And a lot of times it's very hard. I don't think it should be easy. I think that's part of the greatness of this journey, that a lot of time is hard. So my, again, for anybody who wants to fight stress, is make sure to set some time for you to do things that are not related to what you normally would. And the other one is learn how to deal with those emotions, because there's nothing else. It's not supposed to be easy. It's fun because it's not easy.

I think I mentioned the most important ones, but I'll say another one, right? Which is like, every big problem is a set of solvable small problems.

It's going to be funny. I think it was somewhere in 2008, and we got to the average of 12 new subscriptions a day, right? For $99.90. And with some money, of course, in the bank. And I did this calculation in my mind where I was like, okay, so if we take this, and those are subscriptions, I didn't think about churn, so it was kind of, now I look at it, it was a big mistake, but we keep adding that every day, okay? And we have money in the bank, and I know how to, I think, get that to be five times more, we'll never have to close the company. We built a company that can last forever, right? Or till the market changed. And I was so happy about it. I was like, guys, we are profitable! And what, like, what are you talking about? Lunch was more than what we did today. And then I started to show them the mathematics.

This is kind of hindsight wisdom, but a lot of what we missed was about how strong to build some of the infrastructure of the technology. And at some point you pay so much for that that it's incredible. But I would say that the most important thing that I learned from experience is that you can't allow small mistakes to enter into the product. And I'll explain, because it was not my first company, I built other companies before it, I knew about conversion and building retention and A/B testing and a lot of the things I already knew. But one thing that I didn't realize, when a company keeps growing, right, for 18 years, we feel that every product is allowed to make a mistake that affects 2% of the users, which is nothing, who cares, 2% of the users, right? But then you have 10 product groups, so now you have 20% of users being affected by dramatic things. Well, at some point the switch, right? You have a new product group and the switch, so now you have 80%, right? And that doesn't take long, five years. This is something that I had to be a lot more brutal with. So that's one. And the other thing is that maintaining the things that work for us in a very firm way, because people come from outside and most of the time they come from companies that are less successful than yours. And that's why they left it. It's not always true, but most of the time. And they bring habits that they learned in those less successful companies, right? And at some point, if you're not super firm about, don't bring this here, this is how we do it, then your company becomes a mix of habits that didn't work in other places and now starting to be the habits that you have in your company. So I think actually that would be the number one advice I would give myself.