No Snap Decision

Steve Testone founded SnapPages LLC with a goal of making website development easier for small businesses and average users.

Image: Nick Simonite

Two years and 65,000 users after launching, website-making tool developer SnapPages LLC is at a crossroads.

The Austin-based company, which offers free and subscription-based versions of its application, is facing a decision on how to differentiate itself from competitors and accelerate growth without massive amounts of venture capital.

Founder and CEO Steve Testone said the company has converted 3 to 4 percent of its users to paying customers of a more sophisticated “pro” model. But the website-development market is still fragmented with smaller players, and he wants to capitalize on an existing user base to become a more established—if not dominant—player in the market.

“Our big problem is just exposure,” Testone said. “We need more people to know about us. It’s one of those solutions that people don’t even know exists.”

SnapPages, which Testone founded in 2007 and publicly launched at a TechCrunch50 event in 2008, employs two workers.

Testone was previously president of Austin-based Web development firm Test 1 LLC. That experience impressed on him how much of a problem website development was for small businesses and average users. Enlisting developers doesn’t always suit users because such arrangements leave them at the mercy of developers for future changes and upgrades after their initial websites are completed.

SnapPages is designed to enable developers to build and manage their websites using simple language and plenty of graphics, coupled with drag-and-drop tools. Besides a free version, SnapPages sells its pro version for $8 per month. It also offers a version for developers for $30 per month.

Competitors include New York-based Squarespace Inc., California-based Weebly Inc., California-based Yola Inc., and Wix.com Inc., which operates from New York and Israel.

In July, Squarespace reported receiving a $38.5 million investment led by Index Ventures and Accel Partners. It was the first outside capital the company raised since its founding in 2003.

At SnapPages, Testone is funding operations with an undisclosed amount of capital from angel investor Reid Funderburk, president of Austin-based BGI Inc., who said a moderate amount of marketing would raise SnapPages’ profile after establishing a reputation with years of word-of-mouth growth. Its monthly growth of 9 to 12 percent has proven that SnapPages is in a position to reach an expansion inflexion point. The company could also team with Internet service providers to offer the product to customers, Funderburk said.

“Now is the time to let the world know,” he said. “I don’t think it will take much fuel on the fire to get it rocking.”

But time is becoming a factor since the industry is maturing, and one dominant player is likely to emerge with the help of venture capital.

Technology veteran Bob Barker, president of 20/20 Outlook LLC, an Austin-based consulting firm, said SnapPages needs to either team with a channel partner with a large customer base that could be targeted for potential sales or collect a round of venture capital to fund a marketing campaign.

“The presence of a well-funded competitor—and other competitors—indicates that [SnapPages] needs to move quickly,” he said.

About 50 percent of SnapPages’ users are in the U.S. It has also attracted clusters of customers in Brazil and Norway.

“The goal from the beginning was: There is a need out there, and I have a passion for building something that could help people,” Testone said. “Plus, there was an opportunity to build a business out of it. I think we’ve executed on everything we set out to do.”