Web development has been rapidly evolving in the past few years. The two most prominent players are Wix.com (NASDAQ:WIX) and Squarespace. Their method towards a no-code-drag-n-drop approach has allowed many users to design and build their perfect website easier than ever. 

 

Squarespace has recently filed to go public through a direct listing in May (tentatively on the 19), which means that the two companies will be competing for that shareholder cash. 

 

Which is the better buy? Should investors ditch Wix and look towards Squarespace?

 

Let’s talk about that.

 

Similar approach, different appeal

 

Both companies operate similar business models. They both entice customers with a “design now, pay us later” dynamic that has proven to be highly effective, but they have slightly different platforms. 

 

Squarespace is the winner when it comes to emphasizing design when building a website, but Wix has the upper hand by being more flexible in the editing capabilities it offers to users.

 

They’re both great platforms, and each offers its own unique features and perks, which means they appeal to different users. Squarespace is considered the best platform for bloggers and online design-related portfolios, while Wix is more popular amongst merchants and sellers.

 

Both platforms also spend more than 40% of their revenue on sales and marketing to attract new subscribers, which is their highest operating cost. They are willing to pay more to attract customers and sell subscriptions, and most of them subscribe for a year or longer.

 

They also offer ‘Business Solutions’ in the form of payment & shipping services, ad campaigns, additional apps, and add-ons.

 

Who’s the winner?

 

With a no-code solution shift powering both companies, it’s hard to say which company is a better investment, especially since Squarespace hasn’t hit the public markets. It will list on the NYSE under SQSP.

Wix seems to be killing it as the category leader, but Squarespace might just snatch their title before they know it. Both of these companies have a great future ahead of them, so keep them on your radar for future investments.