Shopify's acquisitions: A visual overview

Earlier this month, almost a year after acquiring the logistics technology firm Deliverr for $2.1 billion, Shopify sold it to Flexport, along with its entire logistics unit, in exchange for 13 percent stake in the company. Shopify had previously invested in Flexport in 2022 so it owns the undisclosed stake, it had acquired as a result of that investment, in addition to the latest 13 percent.

Deliverr was Shopify’s biggest acquisition. And selling it confirms a big change in Shopify’s strategy. When the Canadian firm acquired it, it wanted to build an end-to-end logistics platform for millions of its merchants.

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Now it wants to go back to doing what it does best, “building incredible software for ecommerce,” as noted by the company’s president Harley Finkelstein in an interview. He also said that after going on a side quest to develop their own fulfillment and logistics businesses, they realized that they could could offer those services more effectively by integrating with Flexport.

In addition to Deliverr, Shopify also sold its second biggest acquisition ever, 6 River Systems, to Ocado, a global fulfillment solutions provider headquartered in the United Kingdom. 6 River Systems builds warehouse automation system comprised of software and autonomous mobile robots (AMRs).

In today’s post, I look back at all the companies Shopify has acquired to date and the main themes that emerge from company’s M&A efforts.

Here is a list of all the companies Shopify has acquired.

1) Acquhires: Dev and Design Agencies

If we look at the early acquisitions - from 2010 to 2016 - the company mainly acquired design and development agencies, and studios - to basically acquhire talent. The most notable in this group are Jet Cooper and Select Start Studios. As a result of these acquisitions, the company ended up acquiring people who held leadership roles at Shopify and some continue to do so.

Here are the notable ones.

Satish Kanwar
He joined Shopify in 2013 as Director of Operations after his design and UX agency was acquired by them in 2013. His role kept changing and he has been leading company’s M&A efforts since late 2020 as the Vice President of Product Acceleration.

Adam McNamara
Adam was Shopify’s Vice President for Product from 2012 to 2014. He joined as a result of company’s acquisition of Select Start Studios, a Canada-based development agency.

Robleh Jama
Robleh became part of Shopify after his studio product studio Tiny Hearts was acquired by the company in 2016. He had initially joined as Sr. Product Lead and currently serves the company as Director of Product (Blockchain).

Here is a complete list of notable leaders and employees Shopify hired as a result of its acquisitions.

The most notable Shopify acquhire came in 2019: Helpful. The Canadian company was a studio-like venture that built different products: AI-powered Employee Directory, Asynchronous Video Messages at Work, and Live Interactive Audio.

As a result of its acquisition, Shopify brought Farhan Thawar and Daniel Debow to its leadership team - who have been serving the company as Vice President and Head of Engineering, and Vice President for Product Demand respectively since then.

Helpful was acquired for about $6 million and as Shopify wasn’t a publicly listed company until mid-2015, it did not disclose the terms of acquisition for most of these companies. But it would be safe to assume that the Canadian software firm did not spend a lot of money on these acquisitions as it had raised a little over $120 million before its public markets debut - $100 million of which was raised in a Series C round in December 2013.

The acquhires, in my opinion, have been the most successful acquisitions for Shopify.

2) Acquisitions for Software

From 2016 onwards, Shopify started acquiring companies for their products. The first in this series was its acquisition of Kit which was a virtual marketing assistant that helped businesses use messaging to market their stores. The product is still live, and has evolved into Shopify Inbox.

The other notable acquisitions in this category include:

Dovetale: an influencer marketing platform that Shopify acquired in 2022. It is still live, and now known as Shopify Collabs.

Oberlo: a dropshipping app for Shopify merchants which was acquired in 2017 and shut down in 2022.

Another notable acquisition for software (apparently for people who built the software) is Tictail, a Sweden-headquartered marketplace for fashion, home décor, and art. This acquisition helped Shopify build the leadership team for Shop app. Siavash Ghorbani joined as Vice President, Engineer (Shop & Shop Pay), Carl Rivera as Vice President, Product (Merchant Services & Shop), and Kaj Drobin as Director of Product (Shop). All three of them are still serving Shopify in these roles.

Here is a list of all the top executives who joined Shopify as a result of acquisition and are still with the company (based on their LinkedIn profiles).

The most expensive Shopify acquisition in the ecommerce software space has been Donde Search, a visual search experience for online stores powered by AI, computer vision, and NLP, which it acquired for $51 million. It is not clear what happened to the software but Donde’s co-founder Liat Zakay still serves Shopify as Director of Strategic Growth (EMEA). Interestingly, she’s the only female leader the company has hired as a result of an acquisition.

This category of acquisition has produced mixed results for the company. It has had both hits and misses.

3) The nine-figure acquisitions

The third theme that emerges from Shopify’s acquisitions is the companies it paid a lot of money to acquire. The companies it paid nine-figures for (ten for one). These include Deliverr, 6 River Systems, and Handshake, a B2B ecommerce marketplace, it acquired in 2019. Handshake is still operational. These are also the companies Shopify acquired to apparently expand its business.

Deliverr and 6 River Systems have been complete failures as Shopify divested both the firms within four years of acquisition. Deliverr was part of Shopify for just a year. The Canadian firm has taken an impairment of $1.6 billion as a result of this divestment.

And there are concerns that the company will take another hit whenever Felxport gets a new valuation as the container prices have dropped by more than 80 percent in 2023 which means that the company’s revenue must have also taken a big hit.

Shopify’s divestment indicates a big shift in company’s strategy as it now apparently wants to focus only on building software for ecommerce but these were the most expensive acquisitions of the company, costing Shopify over $2.5 billion. On the other hand, the acquhires and acquisitions that the company mainly made for software cost it less than $100 million collectively.

Handshake may be the only acquisition in this category which has proven to be somewhat successful for the company and we can’t be certain of that as well.

So, overall, Shopify has fared badly whenever it acquired a company for expanding its business.

TL;DR: Shopify’s best acquisitions were its acquhires. The worst acquisitions have been the most expensive ones.