Merchants of these sizes don’t have much discretionary spend, which is why Square has been trying to move upmarket as much as possible. Further, Shopkeep’s average merchant is quite small, doing ~ $350,000 in annual revenues. From the sales deck they had passed around last year, churn had about equaled new account additions, making it difficult to find growth. Shopkeep had been trying to sell itself for a while. 4 The deal, which is subject to customary closing conditions and post-closing working capital adjustment, is expected to close before the end of the company’s quarter ending December 31, 2020. Lightspeed will acquire ShopKeep for a total estimated consideration of approximately $440 million, satisfied by way of payment on closing of $145.2 million in cash and the issuance of 9,500,000 subordinate voting shares in the capital of Lightspeed, subject to the adjustment mechanisms outlined in footnote 4 below. ShopKeep generated revenue of approximately $50 million 3 and GTV of approximately $7 billion in the trailing twelve month period ending September 2020. “Our partnership sets the stage to help business owners navigate through challenging times, keep pace with rapid change and adapt quickly to meet the rising demands of today’s customers.” “We believe uniting with Lightspeed highlights and amplifies our shared vision to deliver industry leading commerce enablement for small and medium-sized businesses,” said Michael DeSimone, CEO of ShopKeep. Once closed, Lightspeed’s acquisition of ShopKeep will follow the successful integration of multiple premier platforms that experienced accelerated growth following their acquisitions by Lightspeed, including that of Montréal-based Chronogolf, Sydney-based Kounta and Berlin-based Gastrofix. The acquisition will generate strong expected synergies resulting from increased GTV, the ability to leverage integrated go-to-market resources and a combined payments opportunity. “This acquisition will bring ShopKeep merchants, small and medium-sized businesses that make up the backbone of the U.S economy, into the Lightspeed family, providing them even more crucial product innovation and world-class support as they drive the reinvention of American commerce.” “ShopKeep’s commitment to enabling independent businesses to dream big and rise above industry and economic challenges is deeply aligned with our own mission to power the future of commerce,” said Dax Dasilva, Founder and CEO of Lightspeed. Following the closing of the acquisition, Lightspeed will serve over 100,000 customer locations 1 worldwide, generating approximately $33 billion USD in gross transaction volume 2 (GTV). market share, allowing for increased investment in sales, marketing, and research and development to capitalize on the increasing demand for modern, cloud-based, omnichannel commerce solutions. The acquisition immediately expands Lightspeed’s U.S. Lightspeed’s analytics, loyalty, eCommerce, and payments modules, in addition to its multi-location solution, will offer ShopKeep’s customer base the opportunity to enhance their capabilities. The scale achieved by the combination of Lightspeed and ShopKeep presents retail and restaurant business owners in the United States with enhanced resources to pivot their operations. We’re going to copy a bit of text on the transaction to save ourselves some time.ĬOVID-19 is forcing independent businesses to urgently replace legacy point-of-sale systems in order to remain operational and safely adapt to evolving consumer behaviors.
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