- Shopify increased its acquihiring amid a hot market for AI talent.
- The company completed six small acquisitions last year to bolster its technical AI leadership.
- It also brought on an AI and machine learning veteran as its new chief technology officer.
Shopify has stepped up its acquihiring as the race for AI talent heats up.
CFO Jeff Hoffmeister said during the company's fourth-quarter earnings call earlier this month that Shopify had done six "tuck-in" acquisitions in the previous year.
He said that while the deals were small from a financial perspective, they've been an important source of talent and a tactic the company plans to continue.
"These have been very tactical, thoughtful AI hires and we want to continually be thoughtful, proactive, and judicious on thinking about the cash," he said.
Many of the founders that Shopify has hired now hold leadership positions in the company's product org. That includes Nicolas Grasset, the former CEO of AI-driven analytics startup Peel Insights. Shopify brought on the Peel team in May, and Grasset is now a director of product. Relay Commerce acquired the business itself.
Ray Reddy, cofounder and CEO of mobile ordering app Ritual, became a VP of product for retail at Shopify this January as part of an acquihire deal that also included his cofounder, Larry Stinson, and some engineering staff.
"I'm inspired by the opportunity to help local businesses adapt and thrive as generative AI reshapes customer expectations—a moment that reminds me of launching Ritual over a decade ago during the rise of mobile internet," Reddy wrote in a LinkedIn post about his joining Shopify. "I'm excited to join a team poised to help businesses of all sizes succeed as technology rapidly evolves."
Keeping up in a 'white-hot' market
Gil Luria, head of technology research at D.A. Davidson, said Shopify's increased acquihire activity is likely a product of the "white-hot" market for engineers with AI credibility.
"Hiring individuals is sometimes too slow or too expensive," Luria said. "Sometimes it's easier to just buy a small company that has AI engineers just for the talent."
Rousseau Kazi, former CEO of workplace communications platform Threads, joined Shopify's product org when Shopify acquihired the startup's team in June. Michael Averto, cofounder and former CEO of inventory operations platform ChannelApe, began working on inventory management as a product leader at Shopify as part of a deal in July.
Shopify also hired the team behind Stellate, a startup that made developer tools. Cofounder and former CEO Max Stoiber is now a director of engineering leading teams working on Liquid, Shopify's template language for storefronts. In September open-source developer group The Guild acquired Stellate's product and customer base.
Shopify also acquired Checkout Blocks, a checkout customization app, in June and hired Gil Greenberg as a product lead working on checkout extensibility. The Checkout Blocks app is still available for download in the Shopify App Store.
Luria said that Shopify's growth over the years has largely been organic and not from acquisitions. Shopify did invest billions into building its fulfillment network, acquiring Deliverr for more than $2 billion before selling it and the rest of its logistics business to Flexport. Shopify has since described its fulfillment work as a "side quest."
The past year is not the first time Shopify has used acquihires to bring on valuable talent. In 2018 it acquired the team behind Swedish shopping startup Tictail, and many of those leaders were key to the growth of its Shop app. It also acquired the B2B commerce marketplace Handshake in 2019, and those founders have gone on to hold product leadership roles at Shopify.
Shopify is also doubling down on AI talent in other ways. In August, the company hired Mikhail Parakhin as its new CTO. Parakhin led AI advancements like Copilot at Microsoft and also developed search engines and cloud services for more than four years as Yandex's CTO.
Hoffmeister also said during the earnings call that Shopify would continue to make strategic investments in startups building tech that its merchants would find valuable. Its 2024 investments included participation in a pre-seed round for Convergence, which is building an AI agent called Proxy.
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