Shopify started as a snowboard shop in a coffee shop. It made $11.6 billion last year.
In 2004 Tobi Lütke was a German programmer in Ottawa with no university degree. He wanted to sell snowboards online. The store software was so bad he wrote his own. Here is how that turned into Shopify, the numbers, and what you can copy.
Overview
Tobias Lütke grew up in Koblenz, Germany. He left regular school after tenth grade for a programming apprenticeship. In 2003 he moved to Ottawa, Canada, to be with Fiona McKean, now his wife.
He loved snowboarding and wanted to sell boards online. In November 2004 he launched Snowdevil with Daniel Weinand and Scott Lake. He had no office. He worked out of a Bridgehead coffee shop on Elgin Street. "It was just me; I didn't have an office," he later said.
The shopping cart software he tried, packages like Miva and osCommerce, could not do what he wanted. So he wrote his own in Ruby on Rails, a new programming framework at the time. It took him about two months.
His first order came in as an email. "It said, 'new order.' I literally wrote that email at some point." He says that was the moment he went from someone doing something interesting to an entrepreneur.
Timeline
| Year | What happened |
|---|---|
| 2003 | Moves from Germany to Ottawa |
| Nov 2004 | Launches Snowdevil, an online snowboard shop, on software he wrote himself |
| 2005 | A good first winter. Then summer comes and snowboard sales stop. Other developers keep asking about the software. |
| June 2006 | Shuts the snowboard shop. Launches the software as Shopify, so anyone can open an online store. |
| 2006 onward | Takes no salary. Lives cheaply with Fiona at her parents' home. Her father, Bruce McKean, is an early investor. |
| 2015 | Shopify goes public |
| 2025 | $11.6 billion in revenue |
The numbers
| Figure | Number |
|---|---|
| Revenue, 2025 | $11.6 billion, up 30% |
| Sales through Shopify stores, 2025 (GMV) | $378.4 billion, up 29% |
| Merchant Solutions revenue, 2025 | $8.8 billion |
| Time to build the first version | About two months |
| Lütke's stake | About 7% of the shares, about 40% of the votes |
| Lütke's net worth | About $12.3 billion (August 2025) |
Snowdevil's own sales were never made public, so we do not list a figure for the shop.
How it makes money
Shopify rents store software to people who sell things online. There are two parts:
- Subscriptions. Merchants pay a monthly plan for the store, the checkout and the apps.
- Merchant Solutions. Shopify earns a cut of the money moving through stores: payment processing, shipping labels, loans and other services. This is the bigger part, $8.8 billion of the $11.6 billion in 2025.
So when its merchants sell more, Shopify earns more. That is why the $378 billion in store sales matters as much as the revenue.
What he did right
1. He built what he needed himself
He did not set out to build a software company. He wanted to sell snowboards and the tools were bad. The product came from his own problem.
2. He listened to who was actually asking
Customers stopped buying boards in summer. Developers kept asking how his store worked. He followed the second group and changed the whole business.
3. He kept costs near zero
No office, no salary, living with family. Low costs gave him the years it took.
4. He made the first sale feel real
He says the "new order" email is what hooked him, and he built Shopify so other people could feel the same thing.
Do what he did: step by step
1. Just start. Sell anything.
Start any business. Just take the first step. Lütke did not wait for the perfect idea. He sold snowboards, a thing he already loved, from a coffee shop.
Do this: pick one thing you could sell in the next seven days and put it in front of one real buyer.
2. Solve your own pain point.
He did not plan to build software. The store tools were bad, so he fixed them for himself. That fix became Shopify.
Do this: write down every tool or task that annoys you while you work. One of them may be a business.
3. Be open-minded and flexible.
The business you start might not be the one you end up with. Snowdevil was the start. Shopify was the business. He shut the shop two years in to follow what was working.
Do this: ask yourself which part of what you do gets the most interest, even if it is the part you never meant to sell.
4. Listen. Really listen to your customers.
They have the keys to your problems if you are open-minded enough to hear them. Obsess over your customers more than your original idea. The developers asking "how did you build this?" told Lütke what to build next.
Do this: talk to three people who bought from you or asked you something. Ask what they wish you sold. Write down their exact words.
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Sources
- Ottawa Business Journal, "Entrepreneurial lessons: Shopify CEO Tobi Lütke on his first sale"
- Shopify Inc., Form 10-K for fiscal 2025
- Wikipedia, "Shopify"
- Wikipedia, "Tobias Lütke"
