I hope your week is off to a great start as we exit January and prepare for a new month ahead. Is 2022 flying by already?
In this week's 54th Edition of the Shopifreaks E-commerce Newsletter, I've got Shopify rebuttals, new Walmart mega-partnerships, peculiar payment options, and lots of stories about companies entering into new geographic and service territories.
I've also got some executive turnover and surprise additions to crypto board of directors. All this and more in this week's Shopifreaks newsletter.
Thanks for being a subscriber and for sharing my newsletter to help me grow.
Stat of the Week
74% of consumer payments will be handled by non-traditional financial service providers by 2030 — according to a new study by ICDC Financial Insights. (Retweet It)
1. Shopify is retooling its fulfillment strategy
Last week I reported that Shopify is expected to halve its previous capacity for fulfilling e-commerce orders for merchants after terminating contracts with several warehouse and fulfillment partners. This news was leaked by a Shopify insider.
The company responded by saying that its changes to its fulfillment network would help merchants on its e-commerce platform compete better with big retailers and would not reduce capacity.
The company said in a statement, “We will be making changes to the SFN (Shopify Fulfillment Network) to help merchants compete with big-box retailers, such as prioritizing two-day shipping at affordable prices and access to easy returns for U.S. shoppers. Capacity will not be reduced, and we do not anticipate disruptions to our merchants' fulfillment.”
Shopify added that it would have more details on its fulfillment network during its fourth-quarter earnings announcement on February 16, 2022.
2. Walmart partners with Angi
Walmart announced a new partnership with Angi that will make Angi's more than 250,000 service professionals available to Walmart customers online in 4,000 stores across all 50 states.
Soon when Walmart customers shop in-store or online, they'll be able to book an Angi professional for 150 common home projects including floor installation, painting, fencing, furniture assembly, mounting big-screen TVs, and more. Customers will be able to book home services in-store and online alongside any eligible item, or from Angi’s dedicated landing page at Walmart.com, which goes live in February.
In 2018, Walmart entered the home services market through a partnership with Handy for selling in-home installation services, following Amazon's entry into home services in 2015. Shortly after the Walmart / Handy partnership, Angi acquired Handy. Walmart explained that the new deal is with Angi, not Handy, and that Handy will no longer have its brand showcased on Walmart's website. Same same, but different.
Angi should do a similar deal with Shopify and create a Shopify App that offers similar Angi service integration to Shopify's 1M US merchants who sell eligible items.
3. PayPal launches “Pay in 30” across Germany
PayPal is launching an extension to its BNPL service that will allow German users to pay in full for online transactions up to €1000 without interest up to 30 days after purchase. Users who select the service will have the full amount debited from their account when the 30 day term is up. Customers are also able to change their payment due date before the 30 days is up by paying a fee.
A similar program is currently offered in Germany via a physical credit card by Klarna that can be used for offline purchases.
I have so many questions, starting with… Why?!? This sounds like a terrible and risky payment option for consumers that will inevitably lead to locked accounts and overdraft fees. Plus my credit card already offers 30 days to pay off a purchase without interest… and I earn points on it… and the full amount isn't automatically deducted from my checking account at the end of the month if I need more time to pay. So where's the benefit of using Pay in 30 over a traditional credit card? I don't see it.
I feel like banks and payment providers are playing a dangerous game right now of “Move The Payment Goalpost” with consumers, and it's going to catch up eventually.
Stay tuned next week when I announce PayPal's new “Pay With Your Life Insurance Payout” program where consumers can finance purchases up to $1,000 indefinitely, until they die, and pay in the afterlife via their life insurance payout. LOL. I feel like we're not too far from this the way BNPL is going.
4. BigCommerce enters Germany, Spain, and Mexico
Just six months after expanding into France, Italy, and the Netherlands, BigCommerce has announced that it's launching into Germany, Mexico, and Spain — marking their official entry into Latin America.
This news means that retailers in these locations will see a fully localized experience including integrated locale language, payment methods, and currencies.
Last year, BigCommerce CEO, Brent Bellm, said that the company is focused on signing up bigger merchants that spend more than $2,000/year on the platform. The company wants merchants doing $100k to $1M or more, competing with Magento an Salesforce, instead of going after Shopify's core customer base of DIY store owners.
BigCommerce currently has a roster of established clients in each new region including Tienda Chivas in Mexico, Diageo and Safeguru in Spain, and Unu Motors and Dr. Barbara Sturm in Germany.
5. Shopify denies text book piracy allegations
Remember in early December when I reported that five major publishers were suing Shopify for allowing the sale of pirated textbooks and test materials on their platform and failing to remove stores that violate their trademarks and copyrights?
On Friday, Shopify rejected those claims and told a Virginia federal court that it deals with repeat copyright and trademark infringers on its platform properly — claiming that fewer than 2% of the merchants the publishers targeted were still active on the platform.
Shopify also declared that the publishers, who include Pearson Education Inc, Macmillan Learning, Cengage Learning Inc, Elsevier Inc, and McGraw Hill, are suing them because they couldn't convince Congress to change the Digital Millennium Copyright Act, which protects internet hosts from court claims if they address user infringement reasonably.
Shopify called the lawsuit “an attempt to do through this Court what Plaintiffs could not achieve in the legislative sphere.”
The publishers' attorney, Matt Oppenheim of Oppenheim & Zebrak, responded in a statement by saying that they were confident in their legal position and “glad to see that Shopify agrees they are subject to U.S. law and a U.S. court.”
Sounds like it's heating up in the courtroom! This will be a landmark case for the textbooks (if they choose to include it I guess).
6. Squarespace is getting into video subscriptions
Squarespace is now enabling its users to upload video directly to their Squarespace site and sell access on a one-off or recurring subscription basis. The video clips will be hosted natively on the platform itself with a new “slick playback” and “deep integration into the Squarespace platform.”
The new paywall and membership features are targeted toward chefs, instructors, wellness providers and educators. This will allow customers to utilize Squarespace as a one-stop-shop and not have to look elsewhere (like to Patreon, YouTube, or OnlyFans) for video and subscription services.
Creators will be allowed to upload 30 minutes of video content for free, before being prompted to join a paid plan which offers additional hours of video storage.
Oher platforms are also looking to get into the video subscription space, including Substack which also recently announced that it is expanding into video as a way of keeping creators within the same ecosystem.
7. Afterpay is partnering with brick-and-mortar retailers
Afterpay announced new partnerships with Nordstrom, Tommy Hilfiger, and Calvin Klein — with Nordstom already offering the company's BNPL services online and in-store.
Customers of those retailers will be able to purchase products in store and pay for them over 4 interest-free installments.
Dennis Bauer, president of Payments and Credit at Nordstrom, said in a news release, “We are constantly evolving to enhance the customer experience both in-store and online at Nordstrom and Nordstrom Rack.”
In November I had tweeted that e-commerce is too crowded with BNPL players, and that the billion dollar play is to go after brick-and-mortar retailers. Seems like that was the next obvious move for BNPL providers.
While it makes complete sense for Afterpay to want to go after this offline market and push their way into Nordstrom, I'm curious how (if any) offering BNPL to their customers in-store through Afterpay helps these retailers with customer loyalty. Why doesn't Nordstrom and these other retailers offer white label BNPL services — similar to how they brand credit cards and offer them to their customers?
After decades of offering incentives for customers to sign up to branded credit cards, they're ready to give it all up and pass the coveted finance interaction onto Afterpay and other BNPL providers? It doesn't make sense from a branding perspective. Feels like a rushed and short-sighted way to enter the BNPL space.
8. Other e-commerce news of interest this week
- Coinbase added Shopify founder, Tobi Lütke, to their board of directors, as part of their push to expand its e-commerce capabilities and create an NFT marketplace.
- The CFPB issued a notice and request for comment in the Federal Register regarding their inquiry into BNPL providers. The request will “help the Bureau better understand how consumers interact with BNPL providers, and how BNPL business models impact the broader e-commerce and consumer credit marketplaces.”
- eBay will now authenticate trading cards worth $750 or more from collectible card games, sports, and non-sports cards, as part of their ongoing efforts to assure its customers of the authenticity of high-value items.
- MetaMap, a company that helps entrepreneurs unlock growth across borders, hired two former executives of Shopify and Block. Vivek Narayanadas, most recently VP of Legal at Shopify, joins as its General Counsel, and Lara Harris, formerly Head of Global Talent Operations at Block, joins as VP of Operations and Strategy.
- Daily domestic-package volume will hit 100M packages per day in 2022 — four years earlier than originally forecast by FedEx.
9. This week in seed rounds & acquisitions….
- Inspectorio, a supply chain quality inspection company, raised $50M in a Series B led by Insight Partners. The company will use the funding to expand its capabilities and dive deeper into where the supply chain market still needs visibility. They expect to double their revenue in 2022.
- Brimore, an Egyptian social commerce startup, raised $25M in a Series A round led by IFC and Endure Capital. The company hopes to grow in Egypt by 50x within the next two years and will use the new funds to expand its logistics and operational infrastructure.
- Rainforest, a Singapore-based e-commerce aggregator, announced its formal launch with a seed funding of $36M, a mix of debt and equity, in a round led by Nordstar Partners. Rainforest has already acquired three brands in the home and personal care categories since the company became operational in January 2021.
- Creditas, a Brazilian lending platform, raised $260M in a Series F round led by Fidelity Management and Research Company, valuing the company at $4.8B. The company will use the funding to expand its operations and provide a “one stop solution” for lending on houses, cars, motorcycles, and salary-based benefits.
- Zapp, a London-based instant grocery delivery startup, raised $200M in a Series B round co-led by Lightspeed, 468 Capital, and Broadlight Capital. The company will use the funding to go head-to-head with Getir, Gopuff, Jiffy, Deliveroo and other competitors in the on-demand convenience market.
- Ascend, a BNPL commercial insurance tool that combines financing, collections, and payables, raised $30M in a Series A round led by Index Ventures, along with $250M in lending to finance insurance premium loans, bringing the company's total amount raised to $39M. The company will use the new capital to grow its team, expand into different markets within the insurtech vertical, and build its go-to-market and product engineering.
- Mayd, a Berlin-based on-demand medicine delivery platform in Europe, raised €30M in a Series A round led by Lightspeed Venture Partners, bringing their total raised to date to €43M. The company will use the funding for growth, expanding into two more European markets this year.
- Stonly, a France-based customer onboarding platform, raised $22M in a Series A round led by Northzone and Accel. The company grew by 5x in 2021 with over 20k businesses now using it.
- Vecna, a warehouse automation firm, raised $65M in a Series C round led by Tiger Global, bringing the company's total capital raised to $128.5M. The company will use the funds to fulfill new orders while expanding their existing operations.
- Paack, an e-commerce delivery platform that integrates with robotics, raised €200M in a Series D round led by SoftBank Vision Fund 2. The company will use the funding for product development and to expand into Europe.
- GrowSari, a Filipino B2B e-commerce platform that offers physical retail stores access to a wide range of products and value-add services, raised $45M from KKR as part of their Series C round. The company will use the funds to expand its geographical footprint in the Philippines and enhance its financial service capabilities.
- OZÉ, a Ghanaian fintech startup that provides digital recordkeeping tools to SMBs, raised $3M in a pre-Series A round led by Speedinvest. The company will use the funding to build out its team, acquire more customers, deepen its presence in Ghana and Nigeria, and expand into new African markets.
- Bokksu, a Japanese snack marketplace and subscription service, raised $22M in a Series A round led by Valor Siren Ventures, at a $100M valuation. The company will use the funding to increase their product offerings, grow their team, and improve their delivery times.
- soona, a virtual content creation platform for e-commerce, raised $35M in a Series B round led by Bain Capital Ventures. The company, which offers solutions for over 8,000 brands to create content for e-commerce and marketing through its virtual photo and video shoot technology, will use the funds for growth.
- Passport, an international e-commerce shipping carrier, raised $39M in a Series B round led by TCV. The company will use the funding to further develop their software infrastructure for cross-border e-commerce and to expand their recent acquisition of Access Worldwide by building out their physical logistics capabilities.
- Dealshare, a social commerce grocery startup in India, raised $165M from Dragoneer Investments Group, Kora Capital, and Unilever Ventures,, just months after raising $144M. The company will use the funding to invest in technology and data science, as well as 10x its expansion into logistics infrastructure.
- Zip, an Australian BNPL payment provider, confirmed that it is in talks to acquire Sezzle, a US BNPL provider. The firm seeks to build a “single global BNPL solution across multiple markets.”
What'd I miss?
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Paul E. Drecksler
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