E-commerce technology firm Ecwid, an Encinitas startup that’s developed easy-to-use tools for small businesses to set up online shopping capabilities in minutes, is being acquired by publicly traded Lightspeed for $500 million in cash and stock.
Founded in 2009, Ecwid has lured more than 130,000 customers in 100 countries to its freemium and subscription platform, which helps businesses not only build e-commerce capabilities on their websites but also enables them to sell products through social media partners including Facebook and Instagram.
Efforts to reach Ecwid were unsuccessful. But Lightspeed officials said in a conference call that Ecwid posted revenue exceeding $20 million over the trailing 12 months ending March 31 —chalking up a year-over-year revenue growth rate above 50 percent.
When asked about costs and profit margins, Lightspeed officials said Ecwid was still in investment mode in this stage of its maturation.
“Ecwid is truly one of the most advanced e-commerce engines that you can find, and they do a lot in terms of the digital marketplace,” said Lightspeed President JP Chauvet in the conference call. “We are very excited about Ecwid because it is extremely easy to use for people who want to do stand-alone e-commerce or who want to start digital before they go physical.”
Lightspeed is a cloud-based point-of-sale and e-commerce software provider for restaurants, retailers and other businesses. Founded in Montreal, Canada, in 2005 by current Chief Executive Dax Dasilva, the company went public in 2019 and is dual-listed on the Toronto and New York stock exchanges.
Lightspeed will pay about $175 million in cash and issue $325 million in subordinate-voting-right shares for Ecwib. The deal is expected to close in the calendar third quarter of this year.
“The distinction between online and brick-and-mortar retail has disappeared,” said Ecwid Founder and Chief Executive Ruslan Fazlyev in a statement. “Lightspeed and Ecwid, two best-in-class platforms, will unite to truly empower businesses. By eliminating the barriers merchants face when selling online, we will only more rapidly achieve our common vision of democratizing retail for independent businesses worldwide and enrich the communities they serve.”
Ecwid also has operations in Russia, where it was founded. It employs about 250 workers, according to Lightspeed.
Ecwid raised $42 million in venture capital in May 2020 in a round led by PeakSpan and Morgan Stanley. Prior to that, it had raised $6.5 million since its inception.
Lightspeed has been on a buying spree since it went public, acquiring Vend Limited, Shopkeep and Upserve over the past two years. Now it is grabbing Ecwid and another California company — NuORDER of Los Angeles.
NuORDER has developed a digital platform connecting businesses and suppliers. Lightspeed will pay $425 million for NuORDER, split equally between stock and cash.
Lightspeed’s revenue surged 84 percent to $222 million for its fiscal year ended March 31 in U.S. dollars. But it lost $1.18 per share, compared with a 62 cents per share loss the prior year, on higher acquisition and compensation costs.
Lightspeed announced the Ecwid and NuORDER deals on Monday. Its shares ended trading on Wednesday down 4 percent at $85.74 in Canadian dollars on the Toronto Stock Exchange.
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