Cloud Stocks: BigCommerce Goes Big With IPO

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According to eMarketer, retail e-commerce is expected to account for 21% of global retail spending in 2023 and the COVID-19 pandemic has accelerated this shift. The rapid growth in e-commerce is prompting companies to adopt e-commerce platforms like BigCommerce. Last month, BigCommerce had a spectacular debut in the public market with its stock soaring to over four times its list price on the first day of trading.

BigCommerce’s Offerings

BigCommerce (BIGC) offers a SaaS platform that simplifies the creation of branded e-commerce stores. The company was founded in 2003 as Web business Interspire Pty Ltd. by Australian developers Eddie Machaalani and Mitchell Harper. They started building a browser-based simple website editing tool and went on to build other Internet-based products. By 2007, the two began to offer an off-the-shelf online shopping cart called Interspire Shopping Cart. In 2009, the company pivoted into becoming an e-commerce platform called BigCommerce. For more on their entrepreneurial journey, read my interview with its Co-Founder Mitchell Harper.

BigCommerce was initially helping small and medium enterprises from Sydney establish their e-commerce services. By 2010, it catered to over 10,000 online stores. It next grew out of Australia to establish offices in Austin and San Francisco. By 2019, it catered to about 60,000 stores. Its customers include Avery Dennison, Ben & Jerry’s, Burrow, SC Johnson, SkullCandy, Sony, and Woolrich.

For SMBs, its plans range from $29.95 to $299.95 per month. For its mid-market and enterprise customers whose revenue typically ranges from $1 million to $30 million of revenue per year, it offers customized plans.

Its primary competitors are Adobe’s Magento, Salesforce Commerce Cloud (f/k/a Demandware), and Shopify Plus in the enterprise segment and Shopify and WooCommerce in the SMB segment.

BigCommerce’s Platform Strategy

The BigCommerce platform helps launch and scale an e-commerce operation, including store design, catalog management, hosting, checkout, order management, reporting, and pre-integration into third-party services like payments, shipping, and accounting. All its stores run on a single code base and share a global, multi-tenant architecture purpose-built for security, high performance, and innovation.

BigCommerce is a leader in both branded-site and cross-channel commerce. Cross-channel commerce involves the integration of a customer’s commerce capabilities with other online and offline sites where consumers and businesses make their purchases. BigCommerce offers free, direct integrations with leading social networks such as Facebook and Instagram, search engines such as Google, online marketplaces such as Amazon and eBay, and POS platforms such as Square, Clover (a Fiserv company), and Vend. It also integrates seamlessly with the leading CMSs, digital experience platforms, design frameworks, and custom front ends.

About 10% of its customers use BigCommerce primarily for B2B sales. Most customers’ needs are met using its native functionality, including B2B features like customer groups and price lists. In some cases, customers complement BigCommerce with purpose-built B2B extensions and applications in the BigCommerce Apps Marketplace. Over time, BigCommerce intends to add more B2B functionality to both the BigCommerce Apps Marketplace and its native feature set.

BigCommerce has one of the broadest ecosystems of integrated technology solutions in the e-commerce industry. It strategically partners with, rather than compete against, the leading providers in adjacent categories such as payments, shipping, POS, CMS, CRM, and ERP. Its partners currently offer more than 600 pre-built applications and integrations spanning major categories relevant to e-Commerce. Last year, its CPO Jimmy Duvall disclosed in my Thought Leaders interview that it has over 300 partners and thousands of developers developing on its ecosystem.

BigCommerce’s Financials

BigCommerce generates revenue from two sources: subscription solutions revenue and partner and services revenue. Its total revenue increased 22% from $91.9 million in 2018 to $112.1 million in 2019. Subscription solutions revenue increased 17.3% from $70.5 million in 2018 to $82.7 million in 2019, primarily due to the increase in mid-market and large enterprise customers and international expansion. Partner and services revenue increased by 37.6% from $21.4 million in 2018 to $29.4 million in 2019 driven by increased revenue-sharing activity with technology partners.

BigCommerce bootstrapped initially before raising funding of $224.2 million from investors including American Express, FLOODGATE, General Catalyst Partners, GGV Capital, Revolution LLC, SoftBank Capital, and Telstra Ventures.

On 5 August, BigCommerce listed on the NASDAQ under the ticker BIGC with a list price of $24 and peaked at $93.99. It sold 9.02 million shares, raising $216 million. With the proceeds from the IPO, BigCommerce will continue to invest in its platform and expand in continental Europe, Asia, the Middle, East Africa, and Latin America. Its stock is currently trading at $107 with a market cap of $6.6 billion.


Sramana Mitra is the founder of One Million by One Million (1M/1M), a global virtual incubator that aims to help one million entrepreneurs ...

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