Hi all,
I have been following this board for a while, but thought I never could add value to the insights here (english is also not my first language)
Specifically to address your point I would recommend to listen to the Jefferies Software conference 2021 where the CEO Amir Schlachet speaks. (the Piper Sandler one is similar, but this one is better)
The link is: https://wsw.com/webcast/jeff195/glbe/1826916
15:48 From this point the interviewer talks about the Shopify integration and what the strategic partnership is about. Basically it comes down to Shopify providing a generic solution for general Shopify customers and Global-E’s solution focuses on the needs of Shopify Plus (top 15000 GMV contributors of Shopify). Shopify receive a take rate over the GMV and has warrants (indirect stake) in Global-E. I think the unit economics for Shopify doing this themselves versus this strategic partnership with a GMV take rate, a generic solution and stake in GLobal-E is more profitable for them instead of creating very detailed solutions for very fragmented markets (historically they relied on the app store for that)
Besides the generic solution vs Global-E solution can compete for some Merchants, but the generic solution can also act as a funnel for Global-E solution for merchants that make it to Shopify Plus.
Also an interesting insight:
Around 03:40 the question is asked why someone can’t recreate your solution or customers (brands) in the future taking this inhouse.
Amir says: “Brands could theoretically do it themselves, however the problem is that it does not scale. This creates negative ROI, since each market requires its own unique approach and is very fragmented. The largest brands likely will execute some core markets themselves, however after being in 10 markets or so the economics run negative(OPEX and CAPEX”
His second point is the ‘know-how’ which Global-E has based on aggregated data of over 500 merchants. Similar to Lightspeed they know what is selling, pricing, logistics etc. and they highlight that with the success stories on the website, especially the HUGO BOSS one: https://www.global-e.com/en/success-stories/hugo-boss/
I imagine the marketing must not be that hard, they can basically say:
Hey dear customers, based on our data and google analytics traffic data we know that you are currently have a missed opportunity to not sell in these markets. We will enable you to sell in these markets with the local experience and you generate amount XYZ (that you currently do not have) and we take a smaller piece of that. Thats usually win-win.
Currently I have a small start position and looking to add opportunistically (also early November there is a share lock expiration)