Shopify: The Path to IPO

Russell Lange
May 21st, 2015
Shopify, an online payments and commerce platform, concluded their IPO this morning and began trading on the New York Stock Exchange at a $1.26 billion valuation. From three founders operating out of Ottawa to 632 employees providing services on a global scale, Shopify has achieved extraordinary growth.

Some notes on their development:
  • Shopify was founded in 2006, and raised $5.5 million in their Series A fundraising round in 2010. Prior to the IPO, the company had raised over $87.5 million over three rounds of fundraising.
  • The company is now utilized by approximately 100,000 online retailers, including General Electric, CrossFit, Tesla Motors, and Amnesty International -- contributing to 2014 revenues in excess of $105 million.
  • The pricing range for the IPO was initially set between $12 - $14, however the range was raised to $14 - $16 citing higher than expected interest in the offering. Continued high investor demand drove the IPO price to the top of the range, resulting in initial pricing at $17 per share.

Early Investors Reap Rewards
Bessemer Venture Partners, the lead firm on the Series A fundraise, notched the highest gains on the public offering with a 3,926% gain on their initial investment, made in 2010. The firm owns approximately 30% of the company post-IPO.

Newly Minted
The CEO and founder of the company, Tobias Lutke, completed the IPO with approximately 14% ownership in the company, worth just under $166,000,000 at the $17 IPO price. CTO Cody Fauser and co-founder Daniel Weinand each retain approximately 2% of the company.

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