Shopify - Making Easier To Start, Run, And Grow a Business

Company Profile is an initiative by ListMystartUp to publish verified information on different startups and organizations. The content in this post has been approved by the organization it is based on.

E-commerce has become mainstream in people's daily lives with profound benefits. Shopify Inc. is a Canadian multinational e-commerce company headquartered in Ottawa, Ontario. It is also the name of its proprietary e-commerce platform for online stores and retail point-of-sale systems.

Shopify offers online retailers a suite of services including payments, marketing, shipping and customer engagement tools.

Shopify - Company Highlights

  • Startup Name-Shopify Inc.
  • Headquarters-Ottawa, Ontario, Canada
  • Industry-Software, E-Commerce
  • Founded-2006
  • Founders-Tobias Lütke(CEO), Daniel Weinand, and Scott Lake
  • Total Valuation-$122.3M  (As of 2019)
  • Area Served-Worldwide

Shopify - About and How it Works?

Shopify Inc. is a Canadian multinational e-commerce company headquartered in Ottawa, Ontario. Shopify is a company that develops a cloud-based, multichannel commerce platform for small and medium-sized businesses. It is used to design, set up, and manage stores across multiple sales channels, including web, mobile, social media, brick-and-mortar locations, and pop-up shops. The platform also provides a back-office and a single view of the clients' business.

Shopify operates a cloud-based commerce platform designed for small and medium-sized businesses. Its software is used by merchants to run business across all sales channels, including web, tablet and mobile storefronts, social media storefronts, and brick-and-mortar and pop-up shops.

Shopify - Recent News

As of December 2020, Shopify Merchants Break Records with $5.1+ Billion in Worldwide Sales over Black Friday/Cyber Monday Weekend.

"We're excited to share our Black Friday/Cyber Monday weekend results, with sales of $5.1+ billion from the more than one million Shopify-powered brands around the world. From November 27 through November 30, total sales grew by 76% from the $2.9+ billion reported for Black Friday/Cyber Monday weekend in 2019, a record that was surpassed this year on Saturday, November 28, at 5:00pm ET."

Shopify - Logo and its Meaning

The calm green color of the Shopify emblem symbolizes comfort and growth, it also evokes a sense of safety and reliability. The logo, designed in 2006, wasn't changed until today, as it is a perfect reflection of the company's values and principles.

Shopify - Founder and History

Shopify was founded in 2004 in Ottawa by Tobias Lütke, Daniel Weinand, and Scott Lake after attempting to open Snowdevil, an online store for snowboarding equipment. Dissatisfied with the existing e-commerce products on the market, Lütke, a computer programmer by trade, instead built his own.

Founders of Shopify

The first iteration of Shopify (before it was called such) was an online store that sold snowboards. When Shopify was a store selling snowboards, it was called Snowdevil. When Shopify was first an e-commerce platform, it was called Jaded Pixel.

It only took two years for the company to turn a profit, and now the company boasts $29 billion in sales and over 377,000 active shops on its platform. It’s also grown by leaps and bounds internally. When Lutke started Shopify it was him and a few friends. Now, they have nearly 2,000 employees and five office locations.

Shopify has garnered recognition for its growth and success; in 2012 the company was named “Canada’s Smartest Company” by Profit Magazine and was also a finalist for Startup of the Year. The same year Lutke was a finalist for Entrepreneur of the year, and three years later Shopify was named Employer of the Year in the Canadian Startup Awards.

Shopify - Mission

Shopify's mission statement says, "We help people achieve independence by making it easier to start, run, and grow a business. We believe the future of commerce has more voices, not fewer, so we're reducing the barriers to business ownership to make commerce better for everyone."

Shopify - Business Model

Shopify has a platform business model approach – Shopify acts as a platform that enables users to create an online store in order to sell their goods online. Shopify helps businesses connect with consumers by providing the businesses with the tools necessary to build an ecommerce site.

Shopify Plus is a service thought for enterprise customers, with larger volumes, which is several times more expensive than the advanced plan.

Shopify Plus is for merchants with higher-volume sales and it offers additional functionality, scalability, and support requirements, including a dedicated Merchant Success Manager.

That comprises brands like Unilever, Kylie Cosmetics, Allbirds, and MVMT. Shopify has around 5,300 enterprise accounts as of 2018, which are a key driver of both the company’s subscription and merchant revenues.

Shopify - Revenue and Growth

Shopify revenue for the twelve months ending September 30, 2020 was $2.457B, a 73.4% increase year-over-year.

Today, their platform Shopify hosts over 325,000 shops for individual sellers and internet giants like Google and Tesla. The more money customers made, the more money Shopify made. This drove Shopify to help their users become better merchants, and that's the biggest reason they've grown to where they are today.

Shopify - Funding and Investors

Shopify has raised a total of $122.3M in funding over 4 rounds. Their latest funding was raised on Dec 11, 2013 from a Series C round. Shopify is funded by 8 investors. Felicis Ventures and Insight Partners are the most recent investors.

Shopify - Acquisitions

Shopify has acquired 11 organizations. Their most recent acquisition was 6 River Systems on Sep 10, 2019. They acquired 6 River Systems for $450M.

6 River Systems Sep 10, 2019 $450M 6 River Systems mission is to redefine fulfillment automation for e-commerce and retail operations.

Helpful May 23, 2019 - Helpful is a human way to build relationships at work. Create short mobile videos to energize your distributed team.

Handshake May 23, 2019 - Handshake is a B2B eCommerce platform that helps manufacturers and distributors grow their business by powering in-person and online trade.

Tictail Nov 21, 2018 - Tictail is an online marketplace that enables users to discover independent brands.

Return Magic Jun 20, 2018 - Return Magic is allows merchants to build loyalty while making shopping more convenient for consumers.

Oberlo May 11, 2017 $15M Oberlo connects Shopify merchants with suppliers who ship products directly to consumers.

Tiny Hearts Dec 5, 2016 - Tiny Hearts is an app studio that develops mobile apps and games.

Boltmade Oct 3, 2016 - Boltmade is a software development company that focuses on cloud development, user experience research, and mobile design.

Kit Apr 13, 2016 - Kit is a virtual employee that helps store owners sell more using digital advertising and marketing.

Jet Cooper Aug 2013 - Jet Cooper is a user experience agency based in Toronto, Canada. They provide strategy, design, and development services to leading

Shopify - Competitors

The top 10 competitors in Shopify's competitive set are Magento, BigCommerce, WooCommerce, Squarespace, Wix, Weebly, Volusion, PrestaShop, 3dcart and Ecwid.

Shopify - Challenges Faced

One of the main concerns for most online store owners is the lack of face-to-face customer interaction. This is one of the best and worst things about e-Commerce. These days, customers do a lot of research to avoid brick and mortar stores and shop online. So, store owners need a mechanism where, without having face-to-face interaction with their prospective customers, they can convince them to buy online.

This is the point when analytics comes into the picture. There are lots of analytics options available to the Shopify stores but still, there are some gaps which need to be filled.

In 2017, the #DeleteShopify hashtag campaign called for a boycott of Shopify for allowing Breitbart News to host a shop on its platform. Shopify's CEO, Tobias Lütke, responded to the criticism, saying "refusing to do business with the site would constitute a violation of free speech".

In October 2017, Citron Research founder, short-seller Andrew Left released a detailed report which described the e-commerce platform as a "get-rich-quick" scheme in contravention of Federal Trade Commission regulations. The day the report was released, the stock plunged more than 11%. The main question he posed was "Outside the roughly 50,000 verifiable merchants working with Shopify, who are the other 450,000 the company says it has?" Third-party marketing tactics were expected to be improved. Left was quoted in 2019 by The Street as saying about Shopify "I still think they are best in class".

Shopify - Future Plans

In the last couple of weeks, the company has been making waves and announcing some major product updates and new features. Shopify is now offering not only an easy-to-use e-commerce platform but also a range of products from emailing and shipping to financial services. The company has also reacted to the COVID-19 pandemic by launching its Shopify Capital program in Canada, that offers cash advances between $200 CAD and $500,000 CAD to small and medium-size merchants. All this in the hopes of capturing an accelerating e-commerce penetration and as the founder, Tobi Lütke, emphasizes, to help struggling companies.

The unfolding economic crisis has hit especially small and medium-size businesses hard. With lockdowns in effect all over the world, many companies were forced to turn to online, hoping to restore revenues and keep their business afloat. E-commerce penetration in the U.S. took a steep increase from 16% at the end of 2019 to 27% at the end of April. This change is likely here to stay – even after the lockdowns are lifted, many shoppers will continue shopping online from the safety and comfort of their homes.

Shopify has come to the rescue of small businesses and offered a different kind of partnership. Even before the pandemic arrived, the company was known for its easy to set up and use e-commerce platform. During the crisis Shopify doubled down on the mission to help struggling businesses and capitalized on the increasing e-commerce penetration.

Companies are drawn to Shopify not just because of the platform’s simplicity and accessibility, but also because it allows them to create a unique touch point and relationship with their customers.

There is no “Powered by Shopify” branding on a merchant’s website. One can choose design of their online-shop and decide how to interact with customers. In a recent interview, the CEO and founder of Shopify, Tobi Lütke explained that his desire is to empower brands to create quality products that people love, and use customer feedback to continuously perfect them. This passion shows in the way Shopify builds its platform. It is centered around their merchants – “focus on your products and let us take care of everything else”.

Shopify - FAQs

What does Shopify Inc do?

Shopify is a commerce platform that allows anyone to set up an online store and sell their products.

Where is Shopify headquartered?

The company is headquartered in Ottawa, Canada.

Who is the CEO of Shopify?

Tobias Lütke is the current CEO of Shopify.

How does Shopify make money?

Shopify merchant solutions primarily make money from payment processing fees from Shopify Payments, transaction fees, Shopify Shipping, Shopify Capital, referral fees from partners, and sales of point-of-sale (“POS”) hardware.

Type above and press Enter to search.