Technology

Shopify makes $100M strategic investment in marketing automation startup Klaviyo – TechCrunch

E-commerce marketing automation platform Klaviyo has received a $100 million strategic investment from Shopify, according to documents filed with the US Securities and Exchange Commission. The disclosure coincided with the announcement that Klaviyo and Shopify will strengthen their existing partnership by making Klaviyo the recommended email product for Shopify’s premium merchant plan, Shopify Plus, while also giving Klaviyo early access to Shopify in development – Grant features.

“We’ve worked closely with Shopify for years, and this is a great next step,” Klaviyo CEO Andrew Bialecki told TechCrunch via email. “I’ve spoken to their product team and CEO many times – they believe strongly in our mission to empower developers and have great respect for the products we’ve built and our customer-centric, product-centric culture. Shopify has been key to our growth and a great team to work with, and we’re excited that this will help us serve more customers, faster.”

Founded in 2012, Boston-based Klaviyo — which has been extensively profiled by TechCrunch — integrates with existing platforms (e.g. Octane AI, Recharge) to automate the process of sending emails and texts to customers. With Klaviyo, businesses can set up triggers for abandoned cart messages, product recommendations, and more using a suite of templates and predictive analytics tools.

There’s no shortage of competition in the marketing automation technology space (see Sendlane, Sendinblue, and Cordial to name a few). But Klaviyo has done incredibly well, reaching over 100,000 paying customers including Unilever, Dermalogica, Solo Stove and Citizen Watches.

To date, Klaviyo has raised approximately $775 million with over 1,000 employees. In May 2021, the startup was valued at $9.5 billion by investors including Sands Capital, Counterpoint Global, Accel, and Summit Partners.

For Shopify, Klaviyo is the latest in a series of investments and acquisitions aimed at expanding the reach of the e-commerce platform. In May, Shopify bought shipping logistics startup Deliverr for $2.1 billion — the largest purchase in Shopify’s history — to launch an “end-to-end” logistics platform for merchants. Just this week, Shopify invested in Single, a music and video app used by many businesses on Shopify, following an equity commitment to CMS developer Sanity.

To the extent that they have a focus, Shopify’s investments over the past year have veered toward recommendations and martech. Last September, Shopify funded and partnered with Yotpo, which offers marketing tools and products for consumer sellers. The e-commerce giant recently invested in Crossing Minds, a startup that offers a platform that claims to deliver “personalized experiences” without using any personal information.

There’s certainly pressure on Shopify to better weather what’s likely to be a prolonged economic downturn. Last month, the company laid off 10% of its workforce — about 1,000 employees — in a move that CEO and founder Tobi Lütke called a “necessary” step in response to users canceling their online orders and returning to old shopping habits. The company posted a net loss of $1.2 billion for the second quarter of 2022 and warned shareholders during a conference call last week not to expect inflation to impact earnings for the rest of the year.

https://techcrunch.com/2022/08/02/shopify-makes-100m-strategic-investment-in-marketing-automation-startup-klaviyo/ Shopify makes $100M strategic investment in marketing automation startup Klaviyo – TechCrunch

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