# Shopify - what do they do?



## jargey3000 (Jan 25, 2011)

can someone explain to me (like i'm a 5-year old) exactly what this company does?
i.e. please don't use words like cloud, platforms, e-commerce etc.


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## tygrus (Mar 13, 2012)

They grabbed a cool internet nickname and logo and are now valued at 40 billion even though nobody uses them.


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## Spudd (Oct 11, 2011)

They make it easy for companies to set up web-based stores. They have the code required to make the shopping carts work, the browsing for products, etc. Then the company just has to put up their logo and they're ready to go.


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## My Own Advisor (Sep 24, 2012)

How's this....

This is a company headquarted in Ottawa, that develops and provides software for companies (big and small) to use and manage their online commercial transactions.


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## Beaver101 (Nov 14, 2011)

tygrus said:


> They grabbed a cool internet nickname and logo and are *now valued at 40 billion *even though nobody uses them.


 ... $40B value? Now that's really stupefying.


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## Parkuser (Mar 12, 2014)

They seem to be growing very fast.

http://ottawacitizen.com/business/local-business/shopify-to-triple-size-of-ottawa-headquarters

They've been in the news recently for hosting Trump's people.

http://ottawacitizen.com/news/local...le-use-policy-for-vendors-after-public-outcry

added: And guns, weed and escorts.

http://ottawacitizen.com/news/natio...opify-sites-offering-much-more-than-breitbart


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## nobleea (Oct 11, 2013)

They allow a lot of smaller merchants to get on to Amazon's website very easily.
They're revenue is growing at something like 70%/yr. Still not profitable, but that's pretty common for these new tech companies.
It's probably not worth 40B, but certainly several billion.


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## doctrine (Sep 30, 2011)

They're closing in on a revenue run rate of $500 million a year - this isn't a startup. It's valued at > $10B, or twenty times revenue. It still can't turn an operating profit. Growth seems like it was >100%/yr but now is closer to 70-80%/yr. It seems crazy expensive but keeps going up, so I wouldn't listen to me.


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## jargey3000 (Jan 25, 2011)

...where's that "why i hate the stock market " thread?
I buy WEED when I see there sales are up like, a gazillion % - the stock tanks!
I dont buy SHOP and i see all they've done is managed to shave a few $$ off millions of LOSSES - stock's up 8% !
oh....and i see HCG is up 11% today !


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## jerryhung (Mar 28, 2011)

jargey3000 said:


> ...where's that "why i hate the stock market " thread?
> I buy WEED when I see there sales are up like, a gazillion % - the stock tanks!
> I dont buy SHOP and i see all they've done is managed to shave a few $$ off millions of LOSSES - stock's up 8% !
> oh....and i see HCG is up 11% today !


Yep
It's always the ones we own that go DOWN (I own WEED and AMD and HCG)
but the ones we sold kept going up (SHOP, FB, BABA, NVDA)


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## james4beach (Nov 15, 2012)

This is by far one of the craziest performing large cap stocks in Canada, boosted by the current tech bubble:
SHOP 3 year chart

SHOP is up 98% year to date, and up 104% (doubled) since a year ago. I've considered it for my individual stock portfolio but rejected it a few times as it did not fit my criteria.

You should never feel bad about these things as it's very rare for a stock to perform this well. Most listed stocks perform terribly during their existence. It's very rare for a stock to "take off" and become a great performer. There will always be some that perform great, but it's only obvious in hindsight.

Part of the allure of the stock market is the belief, and hope, that you will choose that next great performing stock. In reality, the probability of finding that stock is very low, especially among smaller caps. And if you load your portfolio with large caps, you end up being a closet indexer and get returns like the index (which isn't a bad thing).


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## kelaa (Apr 5, 2016)

They certainly have sizable penetration, but I could never get my head around the valuation. And being only "software," I felt the barrier to entry was relatively low and the company's market position is not secure. As a case study, Shopify earlier this year suddenly de-platformed gun stores. I'm talking about relatively small businesses without web design, IT, e-commerce expertise. I think most managed to get back online in a few days to a week's time. Shopify is not indispensable by any means.


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## nobleea (Oct 11, 2013)

I run a store based on shopify. It is certainly easy to set up and the back end is very smooth. Easy to get a fairly professional look for a low price. However the biggest drawback, for me, is all these apps. Shopify provides a basic but functional back end, and if you want anything above that you have to pay for third party apps. I'm sure they get a cut of it.
For example, I want to run a sale where its X% of product A, Y% off product B, and free shipping over a price of Z. But the basic shopify only allows a flat X% off everything OR free shipping over Y.
Or when shipping, there's only a default package available. The shipping cost estimator only gets one package to choose from, but you might have several packages necessary to ship your items. You can use a different package, but by then the customer has already paid for shipping and you may be on the hook for the difference.

My little store does about 10-15K in sales a year. Shopify says mine is in the top 15% of stores that opened the same week as I did. This tells you there's a lot of stores that don't make squat.


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## Kabanga (May 15, 2019)

sorry offtop, how can I write a private message? wanted to contact one author but cant find the button(


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## sags (May 15, 2010)

Affiliate sales on free websites have been around for decades. Amazon has their own affiliate stores.

A person can advertise on their own website using Google ads or Amazon ads, but they likely won't generate any earnings because they don't show up in Google search.

These companies sell the sizzle because they have no steak.


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