According to filings filed with the US Securities and Exchange Commission, Shopify has made a $100 million strategic investment in e-commerce marketing automation company Klaviyo. The revelation coincides with the announcement that Klaviyo and Shopify would deepen their current cooperation by making Klaviyo the recommended email product for Shopify’s premium merchant plan, Shopify Plus, as well as offering Klaviyo early access to Shopify innovations in development.
“We’ve been working closely with Shopify for years, and this is a terrific next step,” Klaviyo CEO Andrew Bialecki said in an email to TechCrunch. “I’ve spoken with their product team and CEO several times – they believe strongly in our purpose of enabling creators and have high regard for the products we’ve produced and our customer-first, product-led culture.” Shopify has been critical to our development and a terrific team to work with, and we’re delighted that this will allow us to support more of their customers faster.”
Klaviyo, founded in 2012 in Boston and heavily covered by TechCrunch, interacts with current platforms (e.g., Octane AI, Recharge) to automate the sending of emails and SMS messages to clients. Businesses may use Klaviyo to build up triggers for messages concerning abandoned carts, product suggestions, and other topics, employing a variety of templates and predictive analytics capabilities.
There is a lot of rivalry in the marketing automation technology field (see Sendlane, Sendinblue and Cordial to name a few). Klaviyo, on the other hand, has done exceptionally well for itself, reaching over 100,000 paying clients, including Unilever, Dermalogica, Solo Stove, and Citizen Watches.
Klaviyo, which employs over 1,000 people, has raised over $775 million to date. Sands Capital, Counterpoint Global, Accel, and Summit Partners valued the firm at $9.5 billion as of May 2021.
Klaviyo is the latest in a series of investments and acquisitions targeted at expanding Shopify’s e-commerce platform’s reach. In May, Shopify paid $2.1 billion for shipping logistics company Deliverr, the biggest purchase in Shopify’s history, to build a “end-to-end” logistics platform for merchants. Following an ownership investment in CMS developer Sanity, Shopify has invested in Single, a music and video software utilised by many Shopify shops.
To the degree that they have a focus, Shopify’s recent investments have skewed toward recommendations and martech. Shopify invested in and formed a relationship with Yotpo, which delivers marketing tools and goods to consumer merchants, in September. The e-commerce behemoth recently invested in Crossing Minds, a business that provides a platform for “tailored experiences” apparently without the use of personal data.
Shopify is undoubtedly under pressure to weather what is expected to be a prolonged economic slump. Last month, the firm let off 10% of its personnel, or over 1,000 people, in what CEO and founder Tobi Lütke termed as a “necessary” action in response to customers reducing online orders and returning to previous buying patterns. The business reported a $1.2 billion net loss for the second quarter of 2022 and cautioned shareholders last week during a conference call that earnings will be impacted by inflation for the rest of the year.
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