Generative AI has done an impressive job of improving productivity in a wide range of fields, including website building. There is no shortage of tools that now allow one to create web designs by simply describing what they want in the prompts, including the established Wix player and startups like Relume. 10 weba company based in Armenia, is entering the fray and believes it has an advantage.
10web allows users to quickly create websites built with WordPress, the widely used content management system known to be difficult for beginners to use, using text messages. Unlike Wix and Squarespace, WordPress is open source, which means many features don’t come out of the box and require more advanced web design skills. It doesn’t come with hosting services either, so users have to manage more support tasks.
WordPress still powers about 40% of all websites on the internet thanks to its customization options, according to estimates w3techs. Shopify followed in second place amid a boom in direct-to-consumer e-commerce as sellers look to build their online stores with the Canadian company’s help instead of relying on Amazon.
To make WordPress more intuitive to use, 10web’s engineering team based in Yerevan has integrated artificial intelligence models such as Llama 2, GPT-4 and Stable Diffusion into its website building platform. Such a tool requires a lot of development effort because “architecturally, building a platform for WordPress is not easy,” said 10web co-founder Arto Minasyan, who also runs Krisp, a startup that removes background noise from audio. using machine learning.
“You have to have a very good hosting infrastructure. You must have a managed service to support WordPress security, backups, and uptime. All these things are very, very difficult, because each of the sites is basically an example,” he added. “In contrast, if you’re building on a closed-source solution, say Wix or Squarespace, you’re just building a backend, and then for each site, you’re just building a few pages.”
Minasyan is convinced that the focus on solving WordPress usability will eventually pay off because of the sheer size of the open source community: two million developers. Founded in 2017, 10web is currently operating with positive cash flow. About 20,000 of its users are paying customers (some SMB customers may have several hundred sites, Minasyan noted). In total, 1.5 million websites have been built with 10web.
10web has two ways of monetizing — charging fees per site or by traffic. It plans to add a payment system, which will allow users to bill their customers and 10web receive a cut of the fee as commissions.
The company is generating $5 million in annual recurring revenue right now and is expected to reach $25 million in ARR by the end of next year, Minasyan said. The founder attributed the company’s growth in part to its favorable location in Armenia. Like other former members of the Soviet Union, Armenia has an abundance of affordable engineering talent.
“We have AI talent, which is probably four times cheaper in Armenia than in the US, and here, we can access the best possible AI talent,” suggested the founder. “But if you’re a California-based web developer, you have to compete with Google, Amazon and OpenAI, so it’s not easy to get the best talent.”
Armenia’s budding tech hub in its capital has spawned the country’s first unicorn, Picsart, providing a playbook for other startups to follow. Given Armenia’s relatively small economy, its entrepreneurs have historically ventured abroad, targeting the US in particular. They are hiring engineers in Armenia to take advantage of tech talent at home, while hiring marketing and business development executives in the US, a strategy also shared by 70-10web’s person-strong staff. And of course, having a US footprint can be beneficial for fundraising.
“99% of Armenian startups target the US market,” the founder said. “If you want to raise less than $1 million, you can raise from Armenian VCs, but if you want to raise a couple million for seed or tens of millions for Series A, you have to go to the US.”
