This is the latest in Localogy’s Website Windup series. It examines the ongoing evolution and advancement of SMB-focused website builders, including acquisitions and feature expansion to enhance product bundles.
Late last week, we got word that Wix is launching an investing arm. Known as Wix Capital, it will invest in startups that innovate with web-based products. To best meet the moment, its investment thesis will include Covid-era demand signals such as eCommerce, payments and communications.
Like many corporate investment arms, the goals for each portfolio company will be both financial and strategic. The former follows best practices in venture investing in terms of maximizing financial returns, while the latter seeks potential synergies with Wix’s own evolving product road map.
Specifically, Wix names a few areas where the venture unit will focus. They include online design and development; commerce and business management; and AI and automation. The focus will mostly be on software-based companies but hardware and other technologies aren’t ruled out.
As for the stage of investment, Wix Capital will target seed and early-stage investment rounds. This makes sense for the corporate investment strategy referenced above, as corporate synergies can be discovered and cultivated in early stages. In terms of geography, the fund will have a global scope.
Before formally announcing Wix Capital, the company has already been actively investing. This includes $5.6 million that was recently put into play with companies like 3D-shopping visualization tool RestAR; Asia-focused fintech player Oriente; and dropshipping platform Modalyst.
The timing for this move seems right as Wix can build on some of the momentum it currently has. For example, Wix Capital follows closely behind the recent milestone of surpassing GoDaddy as the world’s largest web host. It also has more than 180 million users and 4,000 employees globally.
So the company is now applying a standard playbook for the strategic advantages of launching an investment arm. Exemplars in this area include GV (formerly Google Ventures) and Salesforce Ventures. Wix CFO Lior Shemesh will lead the fund’s investment operations and strategy.
“Given Wix’s success, the Wix team understands building a world-class team while keeping a strong startup culture,” Shemesh said in a release. “Launching Wix Capital will help us stay on top of emerging trends in our fields and be a targeted effort of allocating strategic support to companies that are looking at us as an example of a strong growth company,”
