BigCommerce Seeking To File U.S. IPO

BigCommerce IPO

Bloomberg reports that the online commerce platform BigCommerce is seeking an initial public offering (IPO) later this year, citing sources familiar with the matter.

The report says the Texas-based company is working with Morgan Stanley on the IPO and could value in at around $1 billion.

If the IPO happens, BigCommerce would follow its largest competitor Shopify about five years later to become a publically traded company.

In 2015, when Shopify went public, it priced its IPO at $17 per share. Shopify had about 162,000 merchants at that time. By comparison, BigCommerce claims about 60,000 merchants today, and while this is a much smaller number, it provides a solid business foundation for growth.

Therefore, this might be an excellent time for BigCommerce to make this jump as it would bring capital to the company to fund and speed up growth. If BigCommerce follows through with the rumored IPO, it could also be a massive opportunity for investors to snap up the stock hoping for similar returns as Shopify.

Shopify’s IPO was priced at $17 per share, and as of today, is trading upwards of $920 per share, an increase of 5,411 percent. While there is no guarantee BigCommerce can duplicate the same growth in a more mature digital commerce environment, there is still considerable growth potential.

BigCommerce IPO Could Capitalize On Recent Online Commerce Growth

The recent boom in online commerce caused by stay-at-home orders because of the coronavirus pandemic appears to be sticking around. For example, Pet products online retailer Chewy.com CEO Sumit Singh said in a recent interview, “The behavior of new customers is very consistent to our mature or existing customer cohorts…”

Also, a few weeks ago, eMarketer research placed Walmart ahead of eBay and behind Amazon as the second-largest online commerce retailer in the U.S. by market share, mostly fueled by its grocery business. The same report suggested significant upward trends among other big-box retailers that leaned on the Buy Online, Pickup in Store (BOPS) model to attract sales.

These trends suggest shoppers will continue to use online shopping for more purchases, offering more opportunities for brands and entrepreneurs to snag a piece of the online commerce pie.

With an IPO, BigCommerce could gain the necessary funding to battle Shopify, Adobe’s Magento Commerce, and other online platforms. All are offering cloud-based online commerce solutions for small businesses but also provide enterprise-level solutions for major brands that are continuing to expand B2C online stores.

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