E-commerce markets continue to play a major role in the way consumers buy goods online and how retailers present and sell goods to these consumers, representing globally 47% of all e-commerce sales. But today, one of the startups that has developed technology to help retailers build and manage more direct relationships – through their own zippy websites – is announcing a big round of growth funding, signs that the market model is not for everyone, and those who cater to these retailers find ground.
Shogun – a platform to help e-commerce businesses of all sizes built on platforms like Shopify, Magento, and BigCommerce easily design and manage their own responsive storefronts – has raised $ 67.5 million. This Series C values Shogun at $ 575 million, a “nice markup” over its previous valuation, Finbarr Taylor, the company’s co-founder and CEO, said in an interview.
He added that the capital will be used both to continue to develop its two main products – Page generator, a drag-and-drop page builder for Shopify merchants; and Frontend Shogun, an end-to-end headless commerce solution, as well as business development and the creation of new technologies, especially in areas such as first party data and personalization.
“We want to help businesses create a destination where they can control the experience,” he said, comparing it to the physical world and the difference between Nike shoes sold in the brand’s own store and at a large retailer like Walmart. “In a Nike store, you can design an experience. At Walmart, you can’t.
Led by Insight Partners – a new investor in the startup – it also included Initialized Capital, Accel, and VMG Partners. Accel led Shogun’s previous round – a $ 35 million Series B – announced less than a year ago, in October 2020. The startup has now raised $ 114.5 million.
The rise in valuation and the rapid succession of its fundraisers are two signs of Shogun’s performance over the past eight months – a period where e-commerce has continued to perform well in the wake of the Covid-19 pandemic . Another is the real growth of the business based on the idea of turning front-end tools that were previously prohibitive into something affordable even for the smallest trader.
One of Shogun’s selling points so far has been that the pages and sites built on its platform run fast: a very important detail in the world of e-commerce where shopping cart abandonment of buying is commonplace and often depends on people’s wait times. for something to load.
Page Builder – the drag-and-drop mainstream site builder for those who build sites on top of Shopify – is now used by around 20,000 businesses, Taylor said, ranging from small startups to Fortune 500 companies, with clients. including brands like K-Swiss, Leesa, Rumpl, BeardBrand, MVMT and Fila. He said traders collectively see GMV (gross value of merchandise or total amount sold) in the “billions of dollars” through their sites.
(For a point of reference, Shogun told me he had 15,000 customers in October; the growth of 5,000 over the past eight months is the same growth as last year.)
Shogun’s new product, Frontend, designed for mid-market to business customers and positioned as a ‘headless’ solution aimed more at web designers and others creating more personalized experiences, now has hundreds of customers and increased by. “Apple’s site is beautiful, but it cost millions to make,” Taylor said. “We want everyone to be able to create these great e-commerce experiences. Frontend has grown tenfold in the past year, Taylor said.
GMV across Shogun’s business has increased 255% over the past two years.
The rise of services like Shogun’s underscores a shift we’ve seen among e-commerce businesses looking for more autonomy and control in how they interact with customers. Sites like Amazon have long been seen as a way to tap into a large population of buyers, as well as a strong fulfillment and shipping infrastructure to store, package, distribute, and deliver products.
There has even been a surge in roll-up games like Thrasio to help consolidate merchants on these platforms to take advantage of even better economies of scale on details like marketing, analytics. customers and manufacturing, which markets like Amazon do not (yet?) handle.
But none of this replaces the ability to define your own destiny.
Now, the rise of services like Shopify, BigCommerce, and Spryker (also supported by Insight Partners) to help manage the backend; Stripe, PayPal and others to manage payments; and others like ShipBob to handle logistics, have made it less and less difficult to create and manage your own online experience. It becomes a higher priority as your business grows, but even for small merchants the idea of controlling your own customer experience is compelling.
Services like Shogun (and others like this are part of this latest trend, like Squarespace or Wix but also others like Duda), which give merchants the tools to create their own e-commerce experiences as they wish. they look like, are the front-ends for this strategy. Opting for the ‘headless’ trade approach is apparently a upward trend.
And that individualism is also where Shogun plans to double down and create more tools for his users, Taylor said.
“It’s all about direct customer relationships,” he said, pointing out that new changes in privacy regulations and the disappearance of cookies mean that retailers can no longer rely on third-party platforms as they do. were doing before. “It is first party relationships. The future is much more personalized online shopping.
This vision is also what interests investors.
“Our investment in Shogun underscores the market’s desire to see headless commerce focused on merchants,” Matt Gatto, managing director of Insight Ventures, said in a statement. “More and more brands want to be able to build progressive headless web applications in a low-code environment. Those at the forefront of e-commerce want to empower web teams to create truly unique and memorable shopping experiences. Shogun is well positioned to make flexible interfaces accessible to brands in a whole new way, and we are delighted to be a partner in this adventure.