Analyzing Shopify’s IPO Price and Stock Performance Since Then

Robert BrandlInka Wibowo

By Robert & Inka

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The Shopify IPO was one of the most highly anticipated stock market events in recent years. Since its initial public offering (IPO) at $17 per share, investors have been eagerly watching to see how this ecommerce giant would fare on Wall Street.

In this blog post, we’ll take a deep dive into the details surrounding Shopify’s IPO price and explore what has influenced its performance since then.

What was Shopify’s IPO price?

Shopify’s Initial Public Offering (IPO) took place on May 21, 2015. The company offered 10 million shares at a price of $17 per share, raising $131 million in total. On IPO day, the shares closed at $25.86, gaining 51%. Since then, the stock has seen impressive gains.

At the beginning of 2022, Shopify’s shares were trading at over $1,300 per share. To make it more attractive for smaller investors again, they decided to split the stock 10:1. That means the equivalent IPO share price would have been $1.70.

Stock Performance Since IPO: After going public in 2015, Shopify’s stock price has steadily risen over the years due to strong growth in revenue and profits. In 2016 alone, the company’s stock doubled, making it one of the best performing stocks that year.

Shopify has seen strong performance since its initial public offering, and as of December 2022, the company boasts a market capitalization of approximately $49 billion. This makes it one of Canada’s most valuable companies.

Overview of Shopify’s Business Model

Shopify is a leading ecommerce platform that provides businesses with the tools they need to create and manage an online store. As our Shopify review shows, the company offers a range of services and products, including website building tools, payment processing solutions, inventory management systems, shipping options, customer service support, marketing features and more. Shopify also provides its customers with access to over 100 third-party apps for additional functionality.

Target Markets and Customers: Shopify primarily serves small businesses who are looking for an easy way to set up an online presence without having to invest in expensive web development costs. However, it has become increasingly popular among larger companies due to its scalability – allowing them to easily expand their operations as needed without having to switch platforms. Shopify’s market share currently stands at around 30% of all ecommerce websites in the US.

Revenue Model: Shopify generates revenue through subscription fees charged on monthly plans ranging from $29 to $299 /month, depending on the number of features required by each user’s business needs. There is also the enterprise-level Shopify Plus plan that starts at $2000 /month. Additionally, Shopify earns money through transaction fees (2% – 2.9%) when customers use certain payment gateways like PayPal, Stripe or their own payment gateway Shopify Payments.

There’s also revenue coming from app purchases made within the platform itself (app developers pay a 20% commission fee).

FAQs

Shopify mainly competes against players like WooCommerce, Magento, Wix, BigCommerce and Squarespace (find more Shopify alternatives here). WooCommerce currently powers more stores than Shopify and could potentially increase its market share even further since it’s an open-source software that is essentially free.

But there is also pressure coming from the lower end of the market, mainly by rivals like Wix who are seeing ecommerce as their main path of expansion.

Firstly, the company reported lower-than-expected revenue growth for its Q4 2022 earnings report. This caused investors to become concerned about Shopify’s ability to maintain its current level of success going forward, which, in the years before, was mainly fueled by the COVID pandemic.

Finally, rising competition from other ecommerce platforms such as Amazon may also be contributing to Shopify’s declining stock price. All of these factors have caused investors to become wary of the company’s future prospects, leading to a decrease in its stock price.

Robert Brandl

Founder and CEO

Hi, my name is Robert Brandl, and I am the founder of Tooltester. I used to work in a digital marketing agency where I managed website and email marketing projects. To optimize my client's campaigns, I always had to find the optimal web tools. Tooltester (founded in 2010) opens this knowledge to you, hopefully saving you endless hours of research. If you have any questions, please leave a comment. You can also find me on LinkedIn.

Inka Wibowo

Content Manager

Hi, I'm Inka! I started using website builders and content management systems over 10 years ago, when I managed websites for clients in my first marketing role. Since then, I've worked on hundreds of web and digital projects. Now, at Tooltester, I'm happy to be able to use my experience to help users like you find the right website builder for your needs.

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