We’ll begin with why the company is worth learning about in the first place. In May 2020, Shopify became the largest company in Canada. It claimed the spot from the Royal Bank of Canada, an institution that was founded in 1869 and employs 80k+ people. Shopify was founded in 2004 and currently employs 5k+.
Since its IPO in May 2015, Shopify’s shares appreciated 4,000%+ as of Aug. 2020. On top of a meteoric rise to its current market capitalization of ~$120b, Shopify’s Lütke is one of the few CEOs who have publicly tweeted about audacious goals like buying Amazon in 2029.
COVID-19 and Shopify:
Amid the pandemic, Shopify made headlines as it saw Q2 2020 gross merchandise volume (GMV) increase 119% YoY. It also established partnerships with Facebook to allow its 1m+ merchants to sell directly through Instagram and Facebook Shops. The company additionally partnered with Walmart to allow Shopify merchants to sell directly into Walmart.com.
The company's recent success despite the pandemic and investor interest in its potential emphasizes the importance of understanding the fundamentals behind the business – and, specifically, understanding how it makes money.
