Shopify Inc., stylized as shopify, is a Canadian multinational e-commerce company headquartered in Ottawa, Ontario that operates a platform for retail point-of-sale systems. The company has over 5 million customers and processed US$292.3 billion in transactions in 2024, of which 57% was in the United States.[2] Major customers include Tesla, LVMH, Nestlé, PepsiCo, AB InBev, Kraft Heinz, Lindt, Whole Foods Market, Red Bull, and Hyatt.[3]
The company's software has been praised for its ease of use and reasonable fee structure.[4] It has been described as the "go-to e-commerce platform for startups".
History
2006: Founding
Shopify was founded in 2006 by friends Tobias Lütke, Daniel Weinand and Scott Lake after launching Snowdevil, an online store for snowboarding equipment, in 2004.[5] Dissatisfied with the existing e-commerce products on the market, Lütke, a computer programmer by trade, instead built his own.[6][7]
Lütke used the open source web application framework Ruby on Rails to build Snowdevil's online store and launched it after two months of development.[8][9]
Technology
Shopify was initially built on Ruby on Rails in 2004, using a single MySQL instance. In 2014, Shopify introduced sharding to distribute Shopify to multiple databases. Over the years, Shopify later moved to fully isolated instances.[84]
Shopify maintains Hydrogen, an open-source headless JavaScript stack created in 2021, for its client-facing storefront applications.[85] Developers are able to deploy their Hydrogen applications to Oxygen, Shopify's managed hosting and content delivery network. Hydrogen is built on top of the React library for client-side JavaScript, and Remix for its server-side routing capabilities.[86]
In 2025 Shopify announced that over the last five years it had migrated all of its apps to React Native so that the same code could be employed for all client platforms.[87]
Shopify App Store
Shopify launched its app store on June 2, 2009.[88] By 2024, the app store had over 10,000 apps available.[89] As of 2021, a typical Shopify merchant used six apps to manage their business and, in 2020, Shopify app partners collectively earned over $230 million on the platform.[90]
The app store enables merchants to extend their store’s functionality across a wide range of categories, including:
The app ecosystem has played a central role in Shopify’s platform strategy, enabling it to scale merchant capabilities through third-party innovation while maintaining a streamlined core product. Jean-Michel Lemieux, then Shopify CTO, emphasized the platform’s “app-first” approach in 2020, stating that it lets developers “build the right tools for millions of merchants.”[99] By 2025, Shopify listed over 16,000 apps in its ecosystem, reflecting ongoing investment in modular expansion.[100]
Universal Commerce Protocol and AI commerce
In January 2026, Shopify announced new commerce technologies aimed at enabling merchants to participate in AI-driven shopping experiences at scale. As part of this vision, Shopify co-developed the Universal Commerce Protocol (UCP), an open standard designed to allow artificial intelligence agents[107] to connect and transact with merchants across different platforms and user interfaces.[108] UCP was developed in collaboration with Google, and has been endorsed by numerous retailers and commerce platforms; it is intended to standardize how agentic commerce interactions — from product discovery to checkout and post-purchase support — are executed without bespoke integrations for each agent or store.[109]
According to Shopify, the protocol supports typical commerce features such as discount codes, loyalty programs, and subscription billing while allowing merchants to retain control over business-critical checkout customizations. The company also announced expanded integrations with major AI platforms, including native shopping in Google’s AI Mode, the Gemini app, and embedded checkout experiences in Microsoft Copilot, enabling merchants to sell directly through these channels while managing their commerce operations through the Shopify admin.[110]
Shopify Partner Directory
The Shopify Partner Directory[111] is a public listing of third-party experts, agencies, and freelancers certified by Shopify to assist merchants in building, customizing, or managing their online stores.[112] Launched as part of the Shopify Partners program, the directory includes developers, designers, marketers, and consultants who meet Shopify’s eligibility criteria, such as completing training or demonstrating expertise. Merchants can filter partners by services, location, or client reviews.
Shop Pay
Shop Pay (formerly Shopify Pay) is a checkout and payment method developed by Shopify. Users add shipping and billing information to a Shop account, which enables one-click checkout on online stores that offer Shop Pay.[113] Launched in April 2017, it was rebranded as Shop Pay in 2020 and later became an accepted payment method on Facebook and Instagram.[114] In 2024, Shopify reported that Shop Pay had over 150 million users worldwide.[115]
Esports
In February 2021, Shopify announced that the company has formed an esports organization called Shopify Rebellion, and put together a professional StarCraft II team to compete in international tournaments.[116] The team members include former 2016 world champion "ByuN" (Byun Hyun-woo) as well as "Scarlett" (Sasha Hostyn).[117][118]
In September 2023, Shopify Rebellion announced it had purchased Team SoloMid's spot in the LCS, the main North American League of Legends esports competition.[119]
Last-mile logistics
In April 2021, Shopify made its first entry in last-mile logistics by investing in Swyft, a Toronto-based digital logistics startup.[120] As part of a Series A round of funding, a total of $17.5 million was raised for Swyft, co-led by Inovia Capital and Forerunner Ventures with participation from Shopify.[121]
On May 5, 2022, Shopify announced its acquisition of Deliverr, a San Francisco, California-based ecommerce fulfilment startup, for US$2.1 billion in cash and stock.[122][123] In May 2023, Shopify wound down its logistics business, selling off its prior related acquisitions; Deliverr and 6 River Systems to Flexport and Ocado Group respectively.[124] As part of the Flexport deal, Shopify received a 13% stake in it, besides making Flexport its official logistics partner.
Acquisitions
In February 2012, Shopify acquired Select Start Studios Inc ("S3"), a mobile software developer, along with 20 of the company's mobile engineers and designers.[126][127] In August 2013, Shopify acquired Jet Cooper, a 25-person design studio based in Toronto.[128]
On December 5, 2016, Shopify acquired Toronto-based mobile product development studio Tiny Hearts. The Tiny Hearts building has been turned into a Shopify research and development office.[129]
In May 2019, Shopify acquired Handshake, a business-to-business e-commerce platform for wholesale goods. The Handshake team was integrated into Shopify Plus, and Handshake founder and CEO Glen Coates was made Director of Product for Shopify Plus.[130] In June 2019, Shopify announced that it would launch its Fulfilment Network. The service promises to handle shipping logistics for merchants and will compete with an established leader, Amazon FBA.
Recognition
Shopify was named Ottawa's Fastest Growing Company by the Ottawa Business Journal in 2010.[139]
By 2014, the platform had hosted approximately 120,000 online retailers,[9][15] and was listed as #3 in Deloitte's Fast50 in Canada, as well as #7 in Deloitte's Fast 500 of North America.[140]
Controversies
The company has stirred controversy for hosting stores for far-right figures and organizations, including merchandise for Holocaust denial.
In 2017, the #DeleteShopify hashtag campaign called for a boycott of Shopify for allowing Breitbart News to host a shop on its platform.[141][142][143] Shopify's CEO, Tobias Lütke, responded to the criticism,[144] saying "refusing to do business with the site would constitute a violation of free speech".[145][146]
In October 2017, Citron Research founder, short-seller
Lawsuits
In December 2021, a group of publishers including; Pearson Education Inc., Macmillan Learning, Cengage Learning, Inc., Elsevier Inc., and McGraw Hill sued Shopify claiming that it had failed to remove listings and stores selling pirated copies of their books and learning materials.[164] The lawsuit was settled "amicably" out of court; the details were not disclosed.[165] A class-action lawsuit for $130 million was filed in May 2023 by employees who had been laid off.[166]
In June 2023 Shopify announced a fight against "patent trolls" who "stealthily orchestrate hundreds of patent litigation cases yearly", and filed a lawsuit.[167]
Data breach
In September 2020, Shopify confirmed a data breach in which customer data for up to 200 merchants was stolen. One of those merchants later said over 4,900 of its customers alone had had their information accessed. Shopify claims that the data stolen included names, addresses and order details, but not "complete payment card numbers or other sensitive personal or financial information." Shopify said that there was no evidence that the data had been misused, and identified two "rogue members" of its support team as having been responsible. They were fired, and the matter was forwarded to the United States Federal Bureau of Investigation.[168]
See also
- Comparison of shopping cart software
External links
References
- Shopify Inc. 2025 Form 10-K Annual Report U.S. Securities and Exchange Commission, February 11, 2026^
- Shopify Inc. 2024 Form 10-K Annual Report U.S. Securities and Exchange Commission, February 11, 2025^
- Trish Novicio. 15 Biggest Companies That Use Shopify