SHOP

Anybody know what happened to Shopify this morning?

This has to be the screwyest market I’ve seen in a long time. I’m afraid to see what it will do to UBNT after it’s earnings today.

I would suspect it comes down together with FB.

If I remember correctly, SHOP was/is supposed to manage sales via FB messenger. Now if FB is coming down on worries of growth…

LNS

SHOP users are using FB messenger. That help them answer questions from their customers.maybe in a contrived way, talks about slowing in FB growth make some think that it reflects on a slowing in usage of FB messenger by Shopify users?

Shopify’s growth hasn’t shown (yet) sign of slowing.

it may simply be an opportunity to add.

tj

it may simply be an opportunity to add

I agree wholeheartedly!

Thanks for the reply’s. Makes sense what your saying regarding FB. I already added before earnings came out so probably won’t add more now. Still wonder what market will do with the good UBNT report. After hours looks good.

it may simply be an opportunity to add

I did add to Shopify today. It was an incredible quarter.

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Earnings were great. These things go in patterns. There are times when good earnings drive big after earnings price increases, and times when it causes big sell offs. In the end, the share price tends to end up the same place anyways.

Some stocks, like GoPro, disasters. Fit Bit, disaster. Stocks like ZEN, ambiguous, but there are few more derogatory words that management can use than “sales cycle has gotten longer” as Zen management used.

This may very well be true, but it is indicative of a company hitting what David called the “tweener” stage, or as some others may call the “chasm”. It is when the low hanging fruit has been largely consumed, and now the company must either break into more lucrative, but much more difficult green fields, or end up tweeting away. It is a very speculative period of time.

Notice how I don’t even need to look at Zen’s results to make this analysis. Just listen to the language and understand the context. Zen is moving from the bottom up, and Sales is moving from the top down. They are starting to compete, and compete for customers that are not in their natural bailiwick up to this point.

SHOP, on the other hand, no such issues. Don’t fight the market, but understand why. If stock is moving on factors beyond future looking fundamentals and risks, it creates opportunity.

Looking at Twilio. Obviously shares falling due to technical issues. Insider selling. I made the call on New Paradigm the moment it was announced that Twilio was doing a very early secondary, a secondary in which the company would raise $50 million for itself, and insiders would cash out to the tune of $400 million or so. RED ALERT and SELL! And so it started the next day from $70 down to $34 or thereabouts now.

But what is Twilio really worth fundamentally? It is clearly the leading company in its field, a truly rule breaking field, that creates customer lock in, and is difficult to replicate. It certainly deserves a premium with a very long-term runway of potential growth. But do any of us really understand Twilio? There is so little really substantive written about Twilio. I’ve dug it up.

If interested we can discuss it on a new thread.

just some quick comments as I cannot seem to let my Apple products down. Watching Apple TV, while getting texts on my iPhone, while playing with my iPad Mini 4, while doing work in the cloud on my MacBook Pro…please, someone help me!!! I have not bought an iPad Pro yet…holding on by my finger nails to total submission.

Tinker

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… Stocks like ZEN, ambiguous, but there are few more derogatory words that management can use than “sales cycle has gotten longer” as Zen management used.

This may very well be true, but it is indicative of a company hitting what David called the “tweener” stage, or as some others may call the “chasm”. It is when the low hanging fruit has been largely consumed, and now the company must either break into more lucrative, but much more difficult green fields, or end up tweeting away. It is a very speculative period of time.

I don’t own Zen but have them on watchlist. So far its just a feeling from talking to others that work in B2B sectors, but enterprises are looking more closer where to invest and what to put on hold and lot of projects seem to be in limbo.

Nobody wants to close out the opportunities if they hadn’t been awarded to a competitor so then get extended and the sales cycle gets longer.

I don’t know what stage Zen is in, they may still have a large base to grow on but that time may not be right now. I think we will see more similar talk coming.

But then, it is just a feeling from my own observations and talking with others.

Yo Tinker - I’d be very interested in looking into Twilio. It is complicated and it makes me think I’ve reached the equivalent point of our parents not being able to figure out how to program the video recorder when I read their announcements. I agree though it could be early days for a long runway of growth and good lock in just like SHOP.

Ant

With the price of TWLO coming down, I would definitely be interested in digging into it.

CMFBLSH

Since this thread is called “SHOP” I’ll point out the expected 2017 revenue growth and current price (relative to sales) for SHOP and for TWLO.


company        Exp 2017 Rev Growth         Current PS Ratio
SHOP                  47%                         10.5
TWLO                  30%                         12.1
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Tinker:

“…Stocks like ZEN, ambiguous, but there are few more derogatory words that management can use than “sales cycle has gotten longer” as Zen management used.

This may very well be true, but it is indicative of a company hitting what David called the “tweener” stage, or as some others may call the “chasm”. It is when the low hanging fruit has been largely consumed, and now the company must either break into more lucrative, but much more difficult green fields, or end up tweeting away. It is a very speculative period of time.”
This is a natural progression of any startup business. There is the initial excitement about the potential and that reflects in the overshooting of the stock price. When some headwinds start to appear, speculators just go the other way and hide for cover. There is an undershoot.
Playing the initial hype can often be disappointing since you never know when the excitement will stop. As it pushes higher there is no reliable guide as to how much higher it will go before that ‘disappointment’ comes and drives it the other way. The other thing you cannot know is how deep the undershoot will be and how long before it gets back to the path of enlightment if it ever does to any degree.
So Zendesk is ‘seeing longer sales cycle’. That was expected since you always have these buying cycles in the enterprise space where Zendesk plays. I think Zendesk is still in its growing stage and that there is more expansion ahead. I bought ZEN after its report.
I also recently added to Shopify. I am considering a bit more after this report.
How do you compare and contrast Zendesk with Shopify? Wouldn’t Shopify start to talk about saturation and competition…eventually? We are not there yet? Do you see something special about Shopify that will allow it to grow for a long time or are you just playing the initial hype (going after the low hanging fruits like you say)?
The story is always the same. It is great until it is not anymore. That happens during that quarterly report when they say something like ‘the sales cycle is getting longer’ or when people are talking about competition rising. It’s just a matter of one report or a couple that produces the inflection point or the reversal. How do you get ahead of that? Should you even try?
tj

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I have looked at some of the Shopify web page examples and most seem very similar. Selling $40 a bottle Grenache via the WWW must not be easy, especially if the site is dull and looks like everybody elses home page.

Has anybody out there actually used their product?

Do they have any sort of lock on the market ?
As more and more smaller merchants realize that many people like to shop from home the demand for an easy way should grow. But unless they have an edge it is only a wild guess about competition in the future.

BTW I note that Tesla is shown as a customer

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Hi mauser,

The reason most of the web pages look similar is because that’s the current in vogue format, the one that generates the most interest/retention/click through. This is a good article on the nitty gritty and of why retailing website design seems to be converging

http://www.ecommercefuel.com/shopify-vs-magento/

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What are the alternatives to SHOP?

  1. If you’re tech savvy, build it yourself from scratch (BTW, that’s how SHOP started). But even if you are tech savvy do you really want to be your IT dept for your retail start-up? I don’t think so. This is not simple coding, you are ultimately responsible for other people’s money and on-line security. That’s complex stuff.

  2. Hire someone to build it for you - yeah, but who? I recall I once built a database and reporting system for a friend (for a rather nominal fee). Anyway, she had trouble getting a report and instead of asking me, she went to another friend who claimed she could “fix it”. What the other friend did was to completely dismantle a 3rd normal form database (geeks here will understand that). In a nutshell it is a database format with minimal redundancy and reasonable well protected from inconsistencies. I refused to help when her reporting turned to crap with inconsistent, unreliable and even contradictory results. And oh yeah, if you think you can just say build it and walk away, you have no idea how much time you will spend answering questions you never imagined anyone would ask.

  3. Buy a tried and true template system with everything in place and customize the user interface for your business and product.

Which alternative would you pick?

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Serious question, and I’m sure I missed the answer somewhere, but who are Shopify’s competitors?

Matt
MasterCard (MA), Nestle (NSRGY), PayPal (PYPL), and Verizon (VZ) Ticker Guide
See all my holdings at http://my.fool.com/profile/CMFCochrane/info.aspx

Serious question, and I’m sure I missed the answer somewhere, but who are Shopify’s competitors?
Brittlerock, Brittlerock’s friend of a friend, in house IT teams and err WIX was mentioned once.
A

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Pees for Shopify are Wix and Etsy according to seeking alpha.

"http://seekingalpha.com/article/3089296-shopify-ipo-a-compar…

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Look at my recent post on the topic that goes into detail regarding top ecommerce vendors.

Tinker

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