Shopify grew out of software built for Snowdevil, an online snowboard store that Tobias Lütke and Scott Lake launched in Ottawa in 2004. Daniel Weinand joined as a third co-founder as the business shifted toward developing an e-commerce platform, which launched publicly in 2006.
The company subsequently expanded into third-party applications, in-person sales, shipping and merchant financing. In its August 6, 2025 financial results announcement, Shopify said its platform powered millions of businesses in more than 175 countries.
From Snowdevil to software for merchants
Lütke, a German-born programmer, later recalled that he initially wanted to run a retail business rather than start another software company. He said existing e-commerce systems could not accommodate the store he wanted, including a custom design he struggled to implement in Yahoo Stores.
He said he spent two months building Snowdevil’s software using Ruby on Rails. In his account, the snowboard store turned a profit during the 2004 season, but the founders decided to develop software for other merchants. That work took about a year and a half before Shopify’s release in 2006.
On June 2, 2009, Shopify launched its API platform and App Store, allowing outside developers to create and sell applications for merchants. The initial applications included tools for printing invoices, collecting customer reviews and selling digital goods.
Expanding beyond online storefronts
Shopify released its point-of-sale system, Shopify POS, on August 12, 2013. The company said it connected online and in-store retail through shared product, inventory and payment management.
The company went public in 2015. On May 20 that year, it announced the pricing of its initial public offering of 7.7 million Class A subordinate voting shares at US$17 each.
Shopify’s engineering team later described changes to the platform’s infrastructure during this period. The team said it divided its database into smaller parts in 2015 after reaching the limits of expanding a single database server. Its account identified a limitation: some operations still depended on multiple parts of the database, allowing a failure in one to disrupt those operations across the platform.
The engineers said they began reorganizing the system in 2016 and introduced groups of stores with isolated data storage, which they called pods. The design was intended to contain failures within individual groups; the account did not provide an independent measurement of its effect on reliability.
On April 27, 2016, Shopify announced Shopify Capital, a merchant cash-advance product. The company said it would initially offer the product to eligible merchants in the United States and use data processed through its platform to tailor advances. Its second-quarter 2016 financial results also identified Shopify Shipping among the services rolled out during the preceding year.
Shopify’s logistics expansion later changed direction. On May 4, 2023, the company announced that it had signed an agreement the previous day to sell most of its logistics business, including related personnel, technology and services, to Flexport. Under the announced terms, Shopify would receive an additional 13% equity interest in Flexport, which would become its official logistics partner. The announcement described the transaction as subject to closing conditions and applicable regulatory approval.
