The Shopify IPO

Acquired

Ben Gilbert and David Rosenthal

Venturecapital, Ma, Investing, Acquisitions, Startups, Vc, Investment, Business, Technology

4.8 • 2.9K Ratings

🗓️ 6 August 2019

⏱️ 89 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

Ben and David head north of the border to Ottawa, Canada to cover perhaps one of the greatest IPO success stories of the past 5 years, Shopify. From humble beginnings as a “lifestyle business” hawking hipster snowboard gear online to now routinely mentioned in the same breath as Amazon, the tale of Shopify and its incredible CEO Tobi Lütke’s ascent is not one to miss!

Sponsors:
Vanta: https://bit.ly/acquiredvanta

Statsig: bit.ly/statsigacquired
Modern Treasury: https://bit.ly/acquiredmoderntreasury

Links:

https://www.snowdevil.ca
https://www.jadedpixel.com
Citron’s “research” report: https://citronresearch.com/citron-exposes-the-dark-side-of-shopify/

Carve Outs:

Ben: Moment smartphone camera lenses: https://www.shopmoment.com
David: Quoteapro engineering and head of product roles — DM @david in the Acquired Slack ; Bill Gurley on Invest like the Best: http://investorfieldguide.com/gurley/

Editor's note: Shopify actually powered $41b of sales, not $14b, in 2018, as discussed toward the end of the episode. $14b was the fourth-quarter number. While this changes the analysis of value captured at the end of the episode (Shopify only captures 2.5% of merchant sales as their own revenue, not 7%, which is admittedly very different), it doesn’t change overall sentiment on the company discussed in the episode.

Transcript

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0:00.0	Dan, you ready? She's always ready.
0:02.0	Always ready.
0:03.2	She's got her own chair here now.
0:06.0	She hopped out of my lap, she's just sitting in the chair.
0:08.0	All right, let's get started. Welcome to Season 5, episode 2 of Acquired, the podcast about great technology companies and the stories behind them.
0:30.0	I'm Ben Gilbert and I am the co-founder of Pioneer Square Labs, a startup studio and early stage venture fund in Seattle.
0:37.0	And I'm David Rosenthal and I am a general partner at Wave Capital, an early stage venture capital firm that focuses on marketplaces based in San Francisco.
0:47.0	And we are your hosts.
0:49.0	Today we are doing an episode that we have gotten a ton of requests for the Shopify IPO.
0:55.0	Now here's a few fun things to know about Shopify before we dive in today.
0:59.3	The company I p.
1:00.3	In May of 2015, with a market cap of $1.3 billion. In the ensuing four years it has
1:07.6	27xed that and today has a market cap of $35 billion.
1:13.7	Not bad for a pivot.
1:15.2	No, no, no.
1:17.1	Two hundred and eighteen million people have bought from a store powered by Shopify, the vast
1:21.8	vast majority of which do not have any awareness that they did that and that is equivalent to almost all adults in the United States
1:30.0	Also not bad the founder and CEO Toby Lutka is an absolutely fascinating character that I can't
1:36.7	wait to dive in on the history and facts here. To give you a quick sense before we dive in he
1:41.4	tweeted last year, I firmly believe that I learned
1:44.1	more about building businesses from playing Starcraft than I've learned from
1:48.0	business books. He might be right, he might be right having read a lot of business books and played a lot of Starcraft in my day.
	...

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