Shopify, the online shopping platform, has helped power more than 15,000 e-commerce store fronts including shops for Angry Birds, the Beastie Boys, General Electric and Tesla Motors. Now, the Ottawa company is announcing it’s raised $15 million in a Series B round from existing investors Bessemer Venture Partners, FirstMark Capital and Felicis Ventures along with a new investment from Georgian Partners.
The company plans to use the money to expand its team of 70 employees, explore partnerships and acquisitions and build up the number of developers who build off the Shopify platform. Shopify has about 80 apps built by developers such as QuickBooks, Mailchimp and Hubspot, who make their software available to store front owners. Now, Shopify is launching a $1 million fund called the Shopify Fund to encourage more apps on the platform. Through the fund, developers will get between $5,000 and $10,000 to help them build apps for Shopify.
Shopify was founded in 2005 as an online retailer of snowboards but became a broader platform after founders Tobias Lutke and Scott Lake saw the need for a scalable service for other entrepreneurs. The company, which has been growing quickly, raised $7 million last December.
Shopify has been actively trying to encourage entrepreneurs to build on its ecommerce platform. It’s currently in the middle of its second Build a Better Business competition, which is giving out half a million dollars in prizes and giveaways to winners. The first competition helped create 1,400 businesses and collectively raised $3.5 million in revenue over its 6-month contest period. Last year’s winner, iPad case maker DODOcase, is on an annual run rate of $4 to $5 million.
“A lot of great stores are starting and building their business on this platform,” said Harley Finkelstein, Chief Platform Officer for Shopify. “They can scale up and they don’t have to graduate off the model.”
Shopify, however, is facing new competition from eBay, which just announced X.commerce, a one-store shopping platform, last week at its developer conference. Shopify also competes with Big Commerce and Yahoo Merchant Solutions.