Shopify is acquiring 6 River Systems, a startup focused on warehouse automation technology development for e-Commerce and retail operations. The purchase is designed to accelerate the growth of the Shopify Fulfillment Network, which launched in June. The deal is valued at approximately $450 million — 60% in cash and 40% in shares.
With 6 River Systems, Shopify adds cloud-based software and collaborative mobile robots called “Chuck,” capable of moving packages around a warehouse, to the Shopify Fulfillment Network. The 6 River technologies are designed to help Shopify increase the speed and reliability of its warehouse operations by empowering on-site associates with daily tasks, including inventory replenishment, picking, sorting and packing.
Shopify’s growth has skyrocketed in the past 12 months, with the e-Commerce platform’s stock jumping a whopping 150% in that time frame. After surpassing eBay’s market capitalization earlier this year (now up $40 billion to roughly $34 billion), Shopify is expected to pass eBay in terms of merchant sales volume in the U.S. as well, according to a note from investment bank R.W. Baird. Shopify reported $362 million in Q2 revenue last month, up 48% from the year-ago period.
The transaction is expected to have no impact on Shopify’s revenue in 2019, but is expected to increase the company’s annual expenses by approximately $25 million. The deal is expected to close in the fourth quarter of 2019.
Shopify estimated that 6 River Systems will have annual revenues of roughly $30 million in 2020.