I Have Concluded That This eCommerce Company Is Winning The Internet (And It Isn't Amazon)

In a shockingly short period of time, Amazon went from a plucky upstart to a goliath. Beginning as a humble book retailer, it capitalized on weak markets and outmaneuvered brick-and-mortar businesses that had previously seemed unshakeable. Where once the threat to mom-and-pop shops was Walmart, now it is the Amazon warehouse. In fact, Amazon did what Walmart could not: it made itself indispensable to small businesses, who often faced a difficult choice between selling on Amazon and paying its fiat fees, or facing bankruptcy.

Amazon has understandably sucked up all the oxygen in discussions of eCommerce. Its sheer scale, documented labor rights abuses, and exploitation of markets have made it a polarizing presence in our lives. And of course, there's the ever-present cost of Amazon Prime, which makes Amazon the go-to for cheap gadgets, home goods, and more. But with every eye focused on the giant, there's an elephant quietly living in its shadow. Outside of two companies in China  — Alibaba and Pinduoduo  — the company with the largest market cap next to Amazon is the Canada-based Shopify.

The fact is, if you've done a lot of purchasing outside of Amazon's gated walls, you've probably interacted with Shopify. Where Amazon hides individual businesses behind its own storefront, Shopify takes the opposite approach, letting the brand you buy from take center stage. That strategy has paid off in spades. Here's how Shopify won over the Internet by betting big on the smallest businesses.

According to Shopify, its founders had a problem to solve  — the same problem anyone starting a business faces. If you want to sell your products online, you need a way to take sales. Payment processing is a headache. Once you've got the money, you need to generate an invoice, match it to the order, and ship the product. Initially, that's what Shopify did. It offered an easy way to build out a digital storefront, manage inventory, and more. Years later, a subscription model was added, in which transaction fees decreased as a customer's subscription needs increased. Now aligned with its market, Shopify grew at a faster rate. Some mark the 2009 launch of its app store as the real turning point.

Today, Shopify accounts for 12% of all eCommerce in the United States,despite plenty of Shopify alternatives on the market. Major players like Tesla Motors use its tools for merchandise sales (though not for vehicle sales). But the company's backbone remains a legion of small business owners. According to BuiltWith, there have been 8.8 million stores historically on the platform, and StoreLeads claims 2.7 million are currently active based on DNS data. Recently, I witnessed firsthand why the company attracts so many entrepreneurs. When my partner began planning for the launch of their own small clothing business, they ran the numbers and came to an easy conclusion. They could either build out a storefront, inventory management software, and payment tools themselves, or avoid thousands of dollars in initial overhead by using Shopify. It wasn't a difficult choice. When that company launches, it will be yet another gem in Shopify's growing crown.