As part of its strategy to create an all-encompassing platform for merchants and their suppliers, Lightspeed POS Inc. on Monday announced the acquisition of two companies: Ecwid Inc., a consumer e-commerce platform, and NuOrder Inc., an e-commerce platform for suppliers, for a combined $925 million in cash and equity in Lightspeed.
The acquisitions are the latest in a series of deals the Canadian processor has consummated over the past year to grow its business. Lightspeed’s latest deal before Monday took place in March, when it acquired Vend Ltd., a New Zealand-based provider of cloud-based retail-management software.
Montreal-based Lightspeed expects the acquisitions to accelerate the company’s push to provide over the next five years an omnichannel commerce platform—including online and in-store transactions—for merchants and suppliers.
The acquisition of Ecwid will allow merchants to transact and communicate with consumers across digital and physical channels, including social media and marketplaces. NuOrder will open the door for Lightspeed to develop a commerce platform for suppliers that simplifies merchant orders, provides insights into how products move through the merchant channel, and offers embedded payments.
“Commerce today is omnichannel. You don’t just sell via multiple channels, but engage with consumers across multiple channels,” Lightspeed president JP Chauvet said during a Monday morning conference call announcing the acquisitions. “But our aim is to not just focus on the merchant as the customer, but [on] all in the ecosystem, including suppliers and consumers.”
Much of the value Lightspeed expects to provide will come through the ability to offer so-called headless e-commerce, which allows front-end and back-end e-commerce applications to operate independently. As a result, changes made to consumer-facing applications on the front end will not require reciprocal changes to back-office applications, and vice versa. That is expected to speed the implementation of any changes made to the e-commerce platform. Front-end and back-end applications communicate using application programming interfaces.
As a result, merchants can create and deploy custom storefronts and turn any device into a point-of-sale terminal faster and more efficiently. In addition, merchants will have access to more consumer data to create custom communications and adjust those communications across each point of interaction with the consumer, as needed. Lightspeed payments will be integrated with the Ecwid platform.
“E-commerce has evolved into headless commerce,” Chauvet says. “[These acquisitions] allow us drive new solutions for merchants.”
Acquiring NuOrder will complement the Lightspeed Supplier Network and accelerate the growth of Lightspeed’s financial-services offerings, including Lightspeed Payments and Lightspeed Capital, while establishing the company as a global distribution network for leading brands, such as Canada Goose, Converse and Arc’teryx, the company says. Launched in January, the Lightspeed Supplier Network has more than 200 active brands.
As part of its plans in B2B e-commerce, Lightspeed plans to provide data to suppliers that identifies what products are selling, which merchants are generating the most sales, and the volume generated through each sales channel. This will allow them to adjust production accordingly, Chauvet says.
“There’s a lot of supplier demand for this kind of functionality, but we lacked it and would have had to build it from scratch,” Chauvet says. “The acquisition of NuOrder accelerates our strategy in this area by three to five years,”
Lightspeed will initially focus on a variety of segments: apparel and footwear, pet stores, gift and bicycle shops, sporting and outdoor retailers, golf shops, home and garden, toy and hobby stores, vape and smoke shops, health and beauty, and jewelry retailers.
“These are verticals where we have a large concentration and can create a network effect among merchants and suppliers,” Chauvet says.
Lightspeed is acquiring Ecwid for $500 million, $175 million of which will be paid in cash, with the balance coming through the issuance of subordinate voting shares in the capital of Lightspeed valued at $325 million.
Lightspeed is acquiring NuOrder for $425 million, $212.5 million of which will be paid in cash with the remaining $212.5 million coming in Lightspeed voting stock.
The deal is expected to close during the quarter ended Sept. 30, 2021, after the receipt of applicable regulatory approval.