Aussie retail platform BigCommerce shines on debut

Australian-born retail platform BigCommerce has made a stellar debut on Wall Street after the company's shares rocketed over 200 per cent during their first day of trading on the Nasdaq index.

BigCommerce priced its initial public offering of 9 million shares at $US24 each, valuing the company at $US6.5 billion ($9 billion), however the shares soared to $US91.80 during the session and closed at $US72.27.

The successful IPO has made company founders Eddie Machaalani and Mitchell Harper billionaires, with their respective 11.9 per cent stake in the company valued at $1.07 billion. Mr Machaalani and Mr Harper no longer run the company but sit on its advisory board.

BigCommerce's platform enables businesses to manage their online sales through marketplaces like Amazon and social media sites like Instagram. It's used by over 60,000 online stores across 120 countries. The company, which is headquartered in Austin, Texas, also has an office with around 60 staff in Sydney.

BigCommerce founders Mitchell Harper (left) and Eddie Machaalani started the platform in 2009. Credit: Louie Douvis

Mr Machaalani said it had been "surreal" to see BigCommerce go public in the biggest market for technology companies after its humble beginnings in 2009.

"We are very proud to be a company that's founded in Australia and I think it's more validation that hey, us Aussies can play on a global scale," he said. "When we pitched to Australian investors back in the day they didn't really understand software as a service they didn't really understand the valuation of tech companies and so we were kind of forced to go to the US."

BigCommerce has thrived during the coronavirus pandemic, which has precipitated a significant shift in shopping behaviour from offline to online, helping the company record an annual revenue run rate of $US137.1 million as of March.

Chief executive Brent Bellm said BigCommerce was in its third straight year of accelerating revenue growth rate and COVID-19 had further driven this.

"We had 10 years of e-commerce adoption in three months," he said. "Now some of that may be temporary while stores are closed but a lot of that is permanent."

BigCommerce's listing price was bumped up from a range of $18 and $20 to a range of $21 to $23 prior to the IPO. However, Mr Bellm said the IPO had not been under priced.

"This type of adjustment is part of the IPO process where the investment banks are trying to discover what supply and demand is at different price points," he said. "You have to start somewhere, see how the orders respond to that and then adjust."

He said BigCommerce would use the money raised in the IPO to expand further geographically.

Telstra Ventures has been an investor in BigCommerce since 2014 and partner Yash Patel said he was pleasantly surprised by the success of the IPO.

"I'd be lying if I didn't say we expected a good outcome but the exuberance in the equity capital markets has been very impressive and I think rightly so," he said. "The company has made a lot of progress since we first invested."

Mr Patel said BigCommerce started out serving smaller businesses competing with rival Shopify but over the years had shifted its strategy to move more to the mid-market and enterprise sector, which had been critical to its success.

"I think the fundamentals of BigCommerce are very solid to ride through any turmoil in the future," he said.

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