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The Shopify Fund, Explained

"The Shopify Fund, Explained": stacks of $100 bills arranged into an "S" shape

Shopify, its API and the App Ecosystem

Every now and again, I get asked this question: “Okay, I’ve heard of Shopify, but what does Shopify actually do?” The answer I give depends on who’s asking:

  • The shortest, quickest, clearest, layperson-friendliest answer is something along the lines of “Shopify is a web app that lets you run your own online shop.”
  • I tell people interested in selling stuff online (as well as people whose inclinations are more towards business) that the stores for Angry Birds, Epic Meal Time, Evisu Jeans, Foo Fighters, General Electric, LMFAO, Penny Arcade and Pixar are all powered by Shopify.
  • And finally, for more technically-inclined people, I say “It’s an easy-to-use, themeable hosted ecommerce platform that’s extensible through an API.”

Let talk about Shopify’s API. It lets you write apps that add functionality to or extend the capabilities of a shop. Most of the things that a shopowner can do from the admin panel can be done programmatically via the API; the API also makes it possible for you to get information from a shop so that you can integrate it with other services. You can write an app that will be used only by your shop, or you can write one for use by any shop, which you can sell to shopowners at the App Store.

The API designed to be simple and straightforward. You can call it using either XML or JSON, and it exposes different parts of a shop – such as products (things you sell in a shop), orders (orders placed by customers) and collections (groups of products within a shop) – as resources, each with its own URL and you manipulate the resources using the HTTP verbs GET, POST, PUT and DELETE. We’ve made it as RESTful as possible.

Screenshot of the Shopify App StoreWhat sort of apps have been written? There are about 100 in the App Store, and they do all sorts of things. Apps that have been featured recently on the Shopify Blog and Shopify Technology Blog include:

The Fund

Last month, Shopify landed a sweet $15 million in series B funding, which we’re using to grow the company in all sorts of ways:

  • Some of it will be used to hire the best developers, designers and businesspeople out there.
  • Some of it will be used to fund strategic partnerships and make some acquisitions.
  • Some of it – one million dollars’ worth – will be used to create the Shopify Fund.

"Dr. Evil" from "Austin Powers", touching his lips with his pinky

That’s right, it’s one. Meeeellion. Dollars.

The purpose of the Fund is to encourage the development of Shopify apps. Apps make everyone happy:

  • Shopowners: because they extend the capabilities of their shops.
  • Customers: because when a shop is running well, they get the stuff they want.
  • You, the developer: because you write software for a living.

Joey deVilla on CTV News with the caption "Joey deVilla: Internet Software Developer"

Not only was I a software developer, I played one on TV!

Most of us at Shopify, myself included, come from a development background, and we’ve all done freelance and contract work. We know what it’s like to worry about where this month’s rent is coming from and to juggle and prioritize clients. Wouldn’t it be nice if you had a nice big client that paid you enough to concentrate full-time on a single project?

We want to be that big client! We created this fund to create a mutually beneficial arrangement: you get paid enough to work full-time on a Shopify app for a few weeks without having to take on other contracts and still make a living, and we get apps that extend the capabilities of our platform.

How Much Money are We Talking About Here?

Jack Nicholson's "Joker", dancing in a storm of bills

We expect that most of the projects will range from a couple of weeks’ to a couple of months’ worth of work. We’re looking at a ballpark figure of about $5,000 – $10,000 per app. The amount will vary with the scope and complexity of your project.

How Do You Get In on Some of This Action?

Screen capture of the Shopify Fund page

There are two ways that you can get in on the Shopify Fund:

  1. If you’re a developer with an idea for an app and we think it’s a good one, we’ll pay you to develop it.
  2. If you’re a developer with the talent to build apps but no idea of what to write, take a look at our App Wishlist and see if there’s an app idea you’d like to implement. If you can prove to us that you can deliver, we’ll pay you to develop it.

If you fall into either one of these categories and would like to get funded, visit the Shopify Fund page and fill out the form. We’re accepting submissions until Wednesday, November 30th.

After the submissions close on November 30th, we’ll spend December and a little bit of January reviewing the submissions. App development and funding will start around mid-January.

What Happens If You Get Funded?

A scattered pile of $100 bills

I like to describe the funding as being "like the advances paid to book authors, but nicer".

Suppose your app gets selected (or you get selected to write an app) and we decide to fund your project with $5,000. Here’s what happens:

  1. At the start of the project, we’ll pay you the first half of the “advance”. In this example, that amount is $2,500.
  2. You work on your app. We’ll check in with you regularly during this time.
  3. When the app’s done, you’ll get the second half of the “advance” — the other $2,500.
  4. Your app goes into the Shopify App Store. For every sale of the app, the revenue share between you and Shopify will be 50/50; you receive 50% and we receive 50%. This 50/50 revenue sharing will continue until Shopify’s total of the 50% share equals the advance we gave you (or in other words, until your app rakes in a total of $10,000).
  5. Once our 50% share is equal to the advance we gave you, the revenue share changes to Shopify’s standard 80/20 ratio for sales in the Shopify App Store: you receive 80% and we receive 20%.

See what I mean by “like a literary advance, but better”? With a literary advance, you don’t earn any money until your sales have paid off the advance. With the Shopify Fund, you’re always taking in money, even while you’re “paying off the advance”.

How Do I Find Out More?

If you have any questions or comments, please feel free to drop us a line at fund@shopify.com! We’d be very happy to answer your questions.

This article also appears in the Shopify Technology Blog.