Shopify rings up US$15-million funding round
Matt Hartley Oct 17, 2011 – 8:21 AM ET | Last Updated: Oct 18, 2011 1:15 PM ET
On Monday, Jaded Pixel Technologies Inc. — better known by its online name, Shopify — will announce it has closed a $15-million round of super angel and venture capital financing from a group of Canadian and American investors.
The series B round, which comes on the heels of a $7-million series A round last year, includes investments from a trio of United States-based firms — Bessemer Venture Partners, FirstMark Capital and Felicis Ventures — as well as Toronto-based Georgian Partners.
“We closed our series A less than a year ago, and while the capital provided by those investors has been a very helpful in terms of our growth, its been their incredible mentorship and guidance that’s been the real value add,” Shopify’s chief platform officer Harley Finkelstein said.
“When we closed the last round of financing, we outlined a road map for the coming 18 months – and we’ve been able to execute on those ambitions far sooner than expected – which is what gave those investors the confidence and the appetite to further invest.”
Founded in 2006 by Scott Lake and Tobias Lutke, Shopify provides business owners with all the software needed to open their own online store, from shopping cart technology and accounting platforms to integration with shipping companies such as FedEx, starting at about $29 a month.
Currently, more than 16,000 companies in more than 80 countries use Shopify’s technology to power their Websites. The site is used by groups such as Amnesty International, the alternative rock band the Foo Fighters and Tesla Motors.
Shopify plans to use the funds for talent acquisitions and to give the company the flexibility to make strategic investments and acquisitions. As well, the company plans to create a new $1-million Shopify Fund, to bankroll promising developers creating apps on the company’s platform.
Already, more than 100 applications have been created for the Shopify platform, which include apps from major brands such as QuickBooks, Mail Chimp and HubSpot. Shopify clients can use third party applications to build out their online business and add extra services.
Earlier this year on May 1, Shopify launched an initiative known as Build-A-Business to help entrepreneurs establish their own e-commerce operations. The company is offering $500,000 in prize money to companies that create an online business using the Shopify platform and generate the most revenue from their new online ventures.