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I don't get it at all. In my model, Shopify spends 75% of Gross Profit on sales to simply maintain existing customer levels. It doesn't seem like customers are

by kolbe 7y ago

I don't get it at all. In my model, Shopify spends 75% of Gross Profit on sales to simply maintain existing customer levels. It doesn't seem like customers are very sticky, so they constantly have to pay huge amounts for sales to get new customers. So, what's the best case scenario? They go from $800m in revenue now to $5bn? Even if they don't increase R&D, that means they're profiting $500m a year. That's an 80 P/E for what I consider to be a very optimistic 6x revenue growth extrapolation. Is there some other huge business (like Facebook's untapped user data in 2012) that isn't making itself known in their financials?

blairanderson 7y ago
- logistics (shopify shipping) - shopify PLUS memberships (+$2K/month) - enterprise level products (handshake, etc) I think the fact that their enterprise sales are growing is a huge indicator. Its replacing legacy ERP systems in sales organizations because of the flexibility and value add. I run a consulting company[0] for Amazon suppliers, and about 90% of our clients don't have "real time" inventory counts. 50% are someone automated but 100% have to enter at least 1 order MANUALLY each month because outdated technology. ORders with hundreds/thousands of line items entered manually will seriously mess up your day. - [0] https://www.andersonassociates.net https://www.andersonassociates.net