Webydo co-founders Steinmetz and Grizim (Photo by Leon Grin) There are start-ups, and then, by Israeli standards, there are start-ups. It’s typical for website designers to charge their corporate clients $5,000 to $10,000 to create sites for them. But a unique outfit called Webydo (based in Tel Aviv, and with an office in New Jersey) is changing that terrain.
Richard Behar, Contributor Forbes
After enlisting a team of mathematicians to create new algorithms, Webydo has removed software code developers and programmers from the picture – enabling professional graphic designers to create sites on the fly for ten times cheaper, and far faster.
Not only that, but the team that is doing this is a case study of what Israel’s “Start-up Nation” may look like in the years to come. Webydo is a collection of individuals that few might imagine joining hands on a venture — even inside a country that already boasts the most NASDAQ-listed companies per citizen. But the multi-cultural Israel – there are Jews, Muslims, Christians, Druse, Bedouin nomads, Bahai, Samaritans and so many others — has begun to fuse many of these groups into their modern economy. At Intel INTC -0.76%, for example, ultra-orthodox Jews (mainly women) now comprise 10% of its Jerusalem workforce, as FORBES reported this week. And high-tech collaborations between Israelis and Palestinians are increasing, as we also discovered and revealed.
At Webydo, one finds a microcosm of this new alchemy.
CEO Shmulik Grizim, age 36, served in a super-elite special forces unit in the Israeli air force that only selects one out of every 1,000 applicants from soldiers. He grew up in an orthodox religious home, but now lives a secular life, which includes spending one month per year training with that military unit in case they are needed for missions.
Webydo’s first investor, by fortuity, is an Israeli-Arab named Hisham Adnan Raya, also 36. He made a small fortune building homes for anyone – Jews, Muslims, Christians, whomever — in Israel’s north. Israel’s Arabs, long viewed as a potential ‘fifth column’ that could rise against the Jews in a war, are not required to serve in the Israeli military. And most of them prefer not to. Moreover, Israeli tech society is largely segregated, so it’s not easy for Jews and Arabs to meet and do business together. But that’s changing, if slowly.
The company’s Jewish co-founder, Tzvika Steinmetz, is – like Grizim — a former Israeli combat soldier, but of a different ilk. He is a religious Zionist, which is symbolized by the wearing of a hand-knitted yarmulke (head-covering).
Finally, one of the first users of Webydo’s technology was Amichay Yuzan, an ultra-orthodox Jew from a sect called the haredim – a Hebrew word meaning “those who tremble before God” – who has built more than 1,000 websites in just one year by using Webydo’s product. Less than 1% of Israel’s 800,000 haredi serve in the country’s military, as they believe that sovereignty in the state of Israel is based on the Torah and not the national government. Moreover, they are so closed-off and segregated that their internet usage is low and highly restricted.
Yuzan’s business is booming, thanks in part to his team of 15 haredi women (most of whom don’t even own TVs) who he trained as web designers on Webydo’s system. They work from his office in the biblical city of Bnei Brak, the country’s largest community of haredi, who physically barricade themselves off from the rest of the country on Sabbath Saturdays.
Dizzy, yet? Welcome to Israel. And, more importantly, to future Israel.
The Webydo story began in 2010, when Grizim and Steinmetz, then running a leading web agency in Israel, identified a need that graphic designers had. There are believed to be about 38 million such designers in the world. However, the whole process of website creation is so dominated by techie geeks that, even today, an estimated 70% of website-creation budgets are spent on the manual production of web code. The vast majority of sites, moreover, are created by developers. Grizim and Steinmetz decided to flip that process on its head – in essence liberating designers from their dependency on those developers.
They hunted for the best mathematicians they could find to build a powerful ‘code generator’ that could convert any graphic design into a functioning website that’s also fairly easy to update and manage by the designers themselves — or their clients. In 2012, they released the first version of their new technology.
Ultra-orthodox (haredi) web designers utilize Webydo’s website-creation software (Photo by Leon Grin)
It was an instant hit. After Google GOOG -0.39% chose Webydo’s technology to provide web solutions for businesses in Israel, some 35,000 websites were rapidly created. Microsoft MSFT -1.55%-Israel also drove business to Webydo after selecting it in a competition as one of the 20 most innovative companies in 2012. Today, 10,000 designers from around the world (mainly the U.S.) have created more than 60,000 websites using this online software.
“Apple AAPL +1.54% products are a good example of putting designers as the leaders of development,” says Webydo CEO Grizim. “Webydo is doing the same, for web designers. We’re eliminating the technical barriers and giving designers a sense of ownership. You know, people initially thought of websites as like building a house. Build it once and renovate it after four years. But it’s actually a living creature with a dynamic dialogue between businesses and their clients. It needs to be updated and changed constantly.”
Echoes the company’s chairman, Itai Horstock, who spent years running venture capital companies in Israel and New York: ”Designers can do what they want [with Webydo software], without any template. They simply ‘drag and drop,’ while the code generator is writing the code behind the scenes. A $10,000 website that took a few months to create takes just a week or less, and it costs $10 a month, including hosting. That’s a revolution.” (Horstock hit it big in 2000, as the main investor in an Israeli firm called Exalink that was sold for $550 million.)
Webydo’s co-founders met Raya, their Arab angel, by happenstance. The homebuilder’s accountant suggested he diversify some of his profits and introduced him to the men behind Webydo. “Once he invested, we opened the company and started everything,” says Grizim. “Our first meeting was very special for us, because we’d never heard of an Arab-Israeli guy doing investments in the high-tech industry.” The three men have since become close friends, taking holidays together in the desert and hanging out in Raya’s lavish home in an Arab city called Sakhnin. “We have great chemistry,” says Grizim. “Actually there are no gaps between us on the personal level. We believe in the same things, we eat the same food, we are playing the same version of the PlayStation.”
But how does Raya feel about investing in a company owned by both an ex-Israeli special forces commando and a religious Zionist? It can’t be comfortable, can it? “In this case, I feel very comfortable,” he says. “Of course, there are so many differences in Israeli society, but in general, if people are intelligent and hardworking, they tend to get along. There’s always an exception in people who like to cause trouble.” He says that Israeli-Arab politics simply doesn’t interest him. Asked if any of his Arab friends think he shouldn’t be doing such investments with Jews, he says, “I make my decisions in the end. But at the end of the day, if you want to make money, you have to work with Jews, and with everybody.” [For a photo of Raya, see this story.]
At the other end of the spectrum sits Yuzan, the ultra-orthodox Jew [haredi] from Bnei Brak. He was given a license in 2011 to try out the technology before it was even publicly available. “He had never created a website in his life, so we didn’t expect much,” says Grizim. “A few months later, my partner said that Yuzan had built 461 websites. I said, ‘No way.’” Today Yuzan has more than 1,000 websites. His initial customers were haredi, but most are now secular.
Webydo’s online software in action
Building a multi-cultural team at the company was never part of the business plan. It just happened on its own. Nonetheless, “it’s in the DNA of Webydo,” says Grizim. “It’s about empowerment – of graphic designers, of women, of everyone. In the business world, there is often a separation between business and charity work, but we don’t see things that way. In Judaism, there’s a term called Tikkun olam, which means repairing the world, because the world is never finished. It’s our responsibility to bring peace and heal the world. In every decision we make at Webydo, we ask ourselves, ‘What does it do for the world?’”
Richard Behar is the Contributing Editor, Investigations, for Forbes magazine. He can be reached at [email protected]
