With the filing of an F-1 document with the SEC, Shopify has announced its intention to pursue an IPO and begin selling shares on the open market. That decision seems to come on the strength of declining losses in Q1 2015. Shopify – which provides subscription eCommerce products and services to SMBs – also saw its revenue increase to $37.3 million. The majority of the firm’s revenue is based on its subscription income.
Shopify is in the Unicorn Club – as it was valued at $1 billion after its last capital raise. And while the term is thrown around a little loosely these days – Shopify really is kind of a unicorn insofar as it is both worth a billion dollars and is based in Canada.
In 2014, the firm brought in revenue of $105.01 million, on which it lost $22.31 million on a net basis. In the first quarter of this year, Shopify posted revenue of $37.35 million, from which the company earned a negative $4.53 million — calculated using normal accounting methods. That is an improvement from a year ago at the same time, when Shopify lost $6.36 million on revenue of $18.81 million.
Shopify will also carry a balance sheet of just under $60 million.
The IPO is currently pegged to bring in around $100 million; however, since Shopify has raised slightly more than that in equity funding, it seems likely that the $100 figure is a placeholder.
Shopify broke out its monthly recurring revenue, or MRR, in its S-1, arguing the following: “Our merchants typically enter into monthly subscription plans so we do not believe deferred revenue is an accurate indicator of future revenue. Instead, we believe Monthly Recurring Revenue, or MRR, is most closely correlated with the long-term value of our merchant relationships.”