This startup does $10 million in annual revenue with almost no investor money — now it's trying to reinvent how web design works (SHOP)

webflow vlad magdalin ceo

Webflow, a break-even company that took relatively little venture capital financing, expects to reach a $20 million annualized revenue run rate this year.
This week, Webflow unveiled a new tool to make it easier for web developers to set up online storefronts.
The whole idea, says Webflow's CEO, is that designers shouldn't have to know how to code in order to get a business off the ground. And he says that it's already helping one designer do the work of several.

Webflow is unusual among Silicon Valley startups. It's only taken in a meager $2.9 million of venture capital money and yet it's still managed to build a break-even company that's doing $10 million in annual revenue.

And Webflow CEO Vlad Magdalin says that the company is growing fast — so much so, that he anticipates that the company will finish out the year on a $20 million annualized run rate, twice what it is today. Webflow has grown to 750,000 users in the four years of its existence, including developers at NASA, Dell, and MTV.

The reason for the boom, says Magdalin: Webflow makes it easier for designers to meet today's demand for slick, shiny webpages. It has a simple visual interface, but under the hood, the websites that Webflow creates are fully compatible with universal web standards, including HTML5, CSS, and JavaScript.

"What we're trying to do is take this concept of code and bring it to as many people as possible," says Magdalin.

Now, Webflow's next move is, perhaps, non-intuitive: It's unveiling a forthcoming tool for developers to set up online storefronts on the sites they design.

With this tool, Webflow handles the technology to power shopping carts and taking credit card payments; the designer can just focus on getting the look and feel of the store exactly right. It also brings Webflow into competition with $14 billion Canadian software company Shopify, which makes easy storefronts the core of its own business.

From Magdalin's perspective, it's all part of the mission. As software continues to eat the world, Magdalin sees tools like Webflow as a way to even the scales. A small business may not have the resources to hire whole teams of developers and designers. A tool like Webflow, however, means that a single designer can punch above their weight.

It's all part of a movement that Silicon Valley insiders have taken to calling "no-code:" The idea that professional developers shouldn't be the only ones with the tools to create software. Other examples include Airtable, an increasingly-popular spreadsheet app that also makes it easy to make custom, bespoke apps.

There will always be a place for skilled pros who can solve really hard problems, says Magdalin. But there's no reason why a solo web developer should need to enlist the help of a web developer. And when you do, you make it possible for even more software to be created.

webflow

"When you give normal people access to technology, entire businesses can be created," says Magdalin. "I can imagine a high school student creating a new site like Airbnb or Twitter on a no-code platform."

In the meantime, Magdalin says that Webflow has been moving upmarket. Whereas it originally targeted individual developers, it's been pivoting toward pitching at small teams of designers at ad agencies and other companies.

He says that it's the kind of move that Webflow wouldn't have been able to make if they had gone the traditional route of taking lots of investor money — he feels that venture capitalists would have pushed Webflow after the largest customers, or bust.

With this strategy, he acknowledges that growth will be a little slower than it might have been if they went after those big enterprises. Still, he says that it'll be a much steadier and less risky pace of growth, while also giving the team latitude to develop the product exactly as it sees fit. And the company is breaking even, reinvesting its profits in more research and development.

This approach is already bearing fruit, as happy customers spread positive word-of-mouth. He boasts that at one Webflow customer, one designer was able to do the work of three engineers, saving the employer money.

"That value difference is worth it to many businesses," says Magdalin.

DON'T MISS: This founder explains how not taking investor money let his startup build a product that 750,000 users love

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