Wix is a speculative bet with low long-term survival probability due to AI disruption risks, despite short-term financial strength and buybacks.

next company. Um, let's go with Wix. I just I I find it interesting. I think we covered it about 10 weeks ago and I texted you earlier today.

Um, because obviously, you know, Wix is one of those where probably the 10-year time horizon compared to value today is, you know, has the biggest difference. I would say there's the most uh or the biggest discrepancy between those 10ear horizon.

So bas basically for everyone who doesn't know Wix is a website builder, right? Um so basically what you do, you can use drag and drop to then create your own website.

Um that worked out phenomenally for a very long time. I think I have some some of the numbers here. If you just look through Wix financials, um you don't see any any big impact from AI.

So you don't you're going double digits basically mid-teens. Um in terms of revenue, it also looks the same in a um expansion. So um recurring revenue basically um bookings are going up double digits. um partner revenue growth partner is basically um the more professional side.

So you're a partner if you use Wix. Um basically for example I build Wix websites for like 10 people, right? Then I'm a partner and I basically do that as my job. Um and and that's more sticky.

So it's more important that you have a lot of partners. Um that's going well. Um transaction growth is going well.

And then I like to start I also used it in the um in the podcast. It basically shows how much more profitable each cohort gets over time. And as you can see like the younger cohort, so the the most recent ones are getting more and more profitable.

And that still holds even after Chad GPT, even after AI.

But by far the biggest or the the most important thing I would say is base 44, which is their AI tool to start building websites and it's growing very fast um very rapidly. But the question is sort of what are the margins on that um and we don't yet know.

Um I think I talked to um to one of our members in the community just recently and he said that management said um just in the second half of 2026 they expect 60% margins um for base 44 which would be huge because right now it's just losing money.

Um but it very much comes down to can they do it on the I don't think we need to spend too much time. Um I'll give you a recommendation and then you can just say if you disagree 10ear time horizon I think there's a chance it survives um just because it completely changes the business model primarily through base 44 but the chances are low.

Um if Adobe is C well if Adobe is C you actually get well if Adobe is C you got to put it into probably F but I can't do F. So I would put it E to F where it's pretty likely that it doesn't exist in Monteneius at least not in the way that it currently is.

Yeah I think that's I think that's fair. It's sort of like the epitome of when people talk about uh you know like there's multiple tiers to the software debate. It's sort of like okay you know Adobe is an application that's entrenched with you know software professionals and uh uh has sophisticated design tools and therefore uh you know might have more staying power with Wix.

So, um I I don't I don't have an issue with having them in the E to F tier. And then for value today, I mean, you'd be able to speak better to it, uh Daniel, but I think you said it's up 90% since we looked at it.

So, uh, it it's it's probably not as attractive as it was when we first looked at it.

>> 100%. I think the funny thing is we posted the episode, the day after we got a lot of comments on how bad the timing is because it dropped 10%. Um, and then just 7 weeks later, it's up I think 90% by now.

Um, so it did do quite well and as this comment is basically pointing out and what I basically also said to you is like the buyback power is just insane. You know, at this valuation they can buy back nearly 10% of the market cap in the next 12 months.

I think it's way more than that even. I think technically they could buy back a lot more than just 10%.

Maybe now I got to say, okay, well, if the valuation went up 90%, maybe that's more accurate today. I think when I looked at it, they had even more buying power on that end.

So, I think value today, um, when we did the pitch, I actually bought a bit of, you know, from my personal portfolio, sold it too early, though. Um, but I think at that point, I would have put it definitely into A.

Um, by now, I think you're you're more likely to be in C again.

Again, I think SAS generally moves in tandem right now. So, you know, WIX went up 90% and that's great. If the entire sector goes down, let's say 10%, Wix is down 60. Like, it feels like there's so much more volatility. It's a leverage for bet.

>> Yeah, it's I think C is fine, but expect volatility. Um I think there's a lot more um more to come both to the upside and the downside. And if I mean, that's the interesting thing.

If we say it's Ctier value today, right? um and that it's volatile and then we think it's E to F tier 10 year time horizon. You basically can't give a buy recommendation at that rate because you think even now it's volatile and then in 10 years time it is likely not to exist anymore.

Um also a good comment. I mean SBC is quite high in that name. Um 13% revenue growth per year just needs to turn profit. That's it. Like if you know base 44 it can actually make a profit.

I think that's very attractive but it's a huge if.

um you know they're changing to those cheaper models now as pretty much every company is doing. Um but I think even token cost in like the American companies halfed in like the last gosh I would now give a wrong time frame but like I think we're talking about two or three months.

Um still I think it's pretty much a bet um that you would take at take at this point.

Um, okay, we we got to be quicker. Let's say Dualingo D2E value today it's it's worse than Wix like it can be.

So um you know especially relative uh to Adobe and Duolingo and Wix u may maybe we should just put it in the S tier because uh you know it in 10 years

if you just think about quality um you should look out you know longer term and that's 10 year time horizon here if you see Wix EF Airbnb

Um, so probably you have to summarize it value today probably can only be I mean we have Wix and and C tier probably similar to Airbnb I would say.

>> it's basically a Wix competitor to some extent just like 10 levels above what Wix is doing because the ecosystem is much wider