Please be aware that the valuation of Shopify can fluctuate greatly, and as such, you should be very careful when considering investing in this company. While it may be worth a great deal today, it could be worth much less tomorrow.
Shopify is a Canadian 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 to simplify the process of running an online store for small merchants.”
Shopify was founded in 2004 by Tobias Lütke, Daniel Weinand, and Scott Lake, three entrepreneurs who wanted to start their own online business but were frustrated by the lack of easy-to-use ecommerce tools. Shopify was launched as a way to provide those tools to small businesses.
Shopify has been growing rapidly. In 2010, it was named one of Canada’s Top 100 Employers by Mediacorp Canada Inc., and in 2012 it was named one of Deloitte’s Fastest Growing Technology Companies in North America. In 2013, Shopify raised $100 million in venture capital, and in 2015 it raised $131 million.
In 2016, Shopify partnered with Amazon to launch Shopify Shipping, a service that gives Shopify merchants access to discounted shipping rates from major carriers. And in 2017, Shopify announced that it would be opening a new office in Toronto.
Shopify is now a publicly traded company on the Toronto Stock Exchange (TSX:SHOP)(NYSE:SHOP). As of June 2018, the company had a market capitalization of $9.5 billion Canadian dollars (about US $7.4 billion).
Shopify has been successful in part because it has been able to tap into two major trends: the growth of ecommerce and the rise of mobile commerce. More and more people are shopping online, and more and more people are using their mobile phones to do so.
According to Statista, global retail ecommerce sales reached $2.304 trillion in 2017, up from $1.935 trillion in 2016. And according to comScore, mobile commerce accounted for 45% of all ecommerce traffic in the United States in the second quarter of 2017, up from 36% in the second quarter of 2016.
Shopify has benefited from these trends by offering merchants an easy way to set up an online store and sell their products both on their website and on major marketplaces like Amazon and eBay. The company has also invested heavily in making its platform mobile-friendly; according to Shopify, 60% of its traffic comes from mobile devices.
What is the valuation of Shopify?
The valuation of Shopify is based on its market capitalization as a publicly traded company on the Toronto Stock Exchange (TSX:SHOP)(NYSE:SHOP).
