Shopify – Get Rich Quick or Revolutionizing Retail?
As anyone who plays the stock market knows, Shopify’s share price has seen incredible growth in the last 12-18 months. From their IPO in 2015, the share price has grown from $17 to its peak of over $120 per share in September this year.
This is massive growth.
But then on October 4th, 2017, research firm Citron released an article calling out Shopify as a get-rich-quick scheme, stating that its stock was highly overvalued. In just 1 day, the share price fell over 12% and has continued to decline over the last month, dropping down to $92.57 at one point.
While now the share price is now recovering, closing at $109.36 yesterday (October 30th), many have reached out to us as Shopify Partners to get our opinion on the matter.
Here’s our take.
Shopify’s Sustainable Growth
We have been Shopify Partners for over a decade. But we also have experience across the vast majority of other leading ecommerce platforms and have a wealth of experience with enterprise and startup ecommerce clients alike.
We have managed ecommerce growth for some of the world’s top retail brands, as well as emerging high-growth companies for over 10 years.
At Metacake, we have seen and experienced the evolution of ecommerce firsthand, so we have an inside view and opinion on this latest Shopify story.
There is no doubt that Shopify’s stock is rising aggressively. Is this sustainable? Is it warranted?
In our opinion, yes.
Shopify is Revolutionizing Ecommerce
Shopify is revolutionizing ecommerce. They have been doing it for years. And there is no sign of them stopping any time soon.
Shopify provides the opportunity for any business, small or large, to create a powerful ecommerce store within a single platform at an incredibly affordable rate.
Think about that for a second. Just 10 years ago, that wasn’t even close to possible. Enterprise retailers spent millions to create their online stores and small businesses and entrepreneurs had no plug and play options available, so the vast majority stayed offline.
Now, anyone with entrepreneurial aspirations or a new business idea can test it on the market quickly and easily. And enterprises can take advantage of the security and scalability that Shopify offers, becoming more quick and nimble, as well as saving a fortune.
And this is just the beginning of how Shopify is going to revolutionize ecommerce. Sure, there are other platforms attempting to do the same. But Shopify is far and away the leader in this space.
They are not only revolutionizing ecommerce on the merchant side, but on the consumer side as well, changing the way people purchase online.
Ecommerce is growing. It is no secret that in-store retail is shrinking and online retail is growing, and this trend will most certainly continue. So from our perspective, as the market leader in this ecommerce platform space, Shopify’s share price growth is both warranted and sustainable.
Shopify is a Tool, Not a Scheme
The claim that Shopify is a get-rich-quick scheme is unfounded. As evidence, the Citron article cites the fact that most businesses on Shopify fail, and based on this, they are falsely advertising their platform when declaring it enables you to run a successful business.
What we would say to this is what any entrepreneur already knows. Most businesses fail (over 90% in the first 2 years). So that fact that most businesses fail on Shopify is a moot point. This has nothing to do with Shopify.
Shopify is simply a revolutionary tool available to businesses.
In the same way that Ebay is a tool to facilitate peer to peer sales, in the same way that Paypal is a tool for peer to peer payments, in the same way that Etsy is a tool for craft ecommerce, in the same way an Apple MacBook allows you to run a business through a computer. All of these platforms and products are also tools that revolutionized commerce (and business) online. Shopify is the same. And like these others, Shopify is around to stay.
Thousands and thousands of businesses, from startups to large-scale enterprises use Shopify to power their ecommerce and achieve massive success online. Billions of dollars of revenue run directly through Shopify each year. This is no get rich quick scheme. Shopify is the leading cloud-hosted ecommerce platform and they are here to stay.
But don’t just take our word for it. Check out these other articles.
- Shopify Tumbles as Citron Calls Company Get Rich Quick Scheme
- Shopify Defends Itself After Citron Criticism
