Invest Alpha

Shopify (SHOP)

The Company

Shopify Inc. is a Canadian multinational e-commerce company headquartered in Ottawa, Ontario. It provides a cloud-based, multi-channel commerce platform designed for small and medium-sized businesses. The platform enables merchants to design, manage, and sell their products across various sales channels, including online storefronts, mobile apps, social media, physical retail locations, and marketplaces. Shopify offers a suite of services such as payments, marketing, shipping, and customer engagement tools to simplify the process of running an online store for merchants.

Financials

Total Addressable Market (TAM) and Compound Annual Growth Rate (CAGR)

The global e-commerce market was valued at approximately $25.93 trillion in 2023 and is projected to grow at a CAGR of 18.9% from 2024 to 2030.

Customers

As of 2024, Shopify hosts 5.6 million active stores across more than 175 countries, serving a diverse range of businesses from small startups to large enterprises.

Competitors

Shopify operates in a competitive e-commerce landscape. Its top three competitors include:

  1. WooCommerce: An open-source e-commerce plugin for WordPress, allowing users to build and customize online stores with various extensions and themes.
  2. BigCommerce: A NASDAQ-listed e-commerce platform providing software as a service (SaaS) to retailers, offering a range of customizable templates and advanced features for online stores.
  3. Magento: An open-source e-commerce platform owned by Adobe, known for its flexibility and scalability, catering to businesses of various sizes with a wide range of extensions and integrations.

Founding History

Shopify was founded in 2006 by Tobias Lütke and Scott Lake after launching Snowdevil, an online store for snowboarding equipment, in 2004. Dissatisfied with the existing e-commerce products on the market, Lütke, a computer programmer by trade, built his own platform using the open-source web application framework Ruby on Rails. The Snowdevil founders launched the platform as Shopify in June 2006.