Leon Panjtar’s Post

I get asked all the time: why are we investing in the Future of Commerce at OpenSky? It's kind of a contrarian position when you look at the VC landscape right now. Hear me out. Brands are really hurting and most VCs are betting on decacorn outcomes in either AI (shocker) or categories like fintech, dev tools, etc. The thought process makes sense. These are massive markets that can give rise to companies valued in the $10 to $100 billion range. You can see why funds want to get in. If we look at commerce... yes, there will be some big winners similar to Shopify, Klayvio, etc. But there will be many more "midsize" winners landing in that $100m-$500m exit range. This trend forces us to shape our investment strategy at OpenSky Ventures differently. We need to get in as early as possible with incredible founders to secure great valuations. Here's are 2 reasons why we believe our thesis will deliver: REASON 1) Disruption. Even with all the recent growth, only 20% of commerce happens online right now! Getting that remaining 80% of offline commerce online is a huge software opp. REASON 2) Experience. My VC partner (Josh Resnick) and I have a combined 40+ years of experience in the commerce space as exited entrepreneurs and operators. ➝ JR has also ~75+ DTC/CPG investments and built an incredible brand called Sugarfina. ➝ I scaled StackCommerce to 9-figs and am now building in ecom SaaS again with Onward. This gives us a deep understanding of what's working in DTC SaaS. Together, we have an information advantage over other VCs in commerce. We're also better able to support founders in our portfolio with the connections we've built up over the past decade in the industry. We're bullish on the future of commerce and the founders who are building it. I'll be posting more about our thesis here, as well as some of the behind the scenes of: • What goes into winning in VC in 2024 • How I'm scaling Onward (my new SaaS company) profitably If that sounds interesting, follow me here. Also, would love to know what you think about what I laid out above. Let me know in the comments.

The IPO that we all waited for. I could not imagine anybody more ready to go public than Klaviyo. Their filing will not only be an event watched by all of us - startups, VCs, PEs, Crossovers, Bankers, etc. - it also sets a new (or at least the current) standard to be IPO-ready: At $585M (!!!) revenue they are growing a stunning 56.5%. Congrats to Andrew Bialecki, Ed Hallen and the team for this amazing success story. Some more highlights: 👩💻 They have >130,000 customers 🏦 Of those, 1,458 customers generating over $50,000 of ARR, which accounts to >$75M of their revenues 🛒 Klaviyo grew well along with Shopify and therefore it’s no surprise that about 77.5% (as of December 31, 2022) of their ARR was derived from customers who also use Shopify’s platform 📈 Shopify is as well a relevant shareholder owning about 11,2% of the cap table and might be a significant beneficiary after the IPO 🚀 Their NRR is at 119%, a good value at that size and scale 🦸♀️ Now to my favorite KPI: With 1,548 employees as of June 30, 2023, the revenue per employee is at $378k (which is an outstanding achievement by the team). I’m looking forward not only to their IPO but to the next years to come as they will build further out their business. For all of us founders and tech-CEOs - this is the current benchmark. Disclaimer: Accel is an investor in both our companies and Klaviyo is as well a partner of commercetools. https://lnkd.in/e-HC6NJe

🎉 It's out: The annual state of online marketplaces in 2023 by Dealroom.co and Adevinta Ventures. Key insights: - Venture capital investment in marketplaces is shifting to other business models like SaaS or hybrid models - Vertical marketplaces attracted 90% of the funding over the last three years - B2B marketplaces attracted an all-time-high 20% share of the funding going to marketplaces - AI-enabled marketplaces are showing considerable growth as they are better equipped to meet the diverse needs of users Access the full free report👇 Thanks for the great work to Eglantine Dupuy, Orla Browne from Dealroom.co, and Jordi Iserte, Mireia C., Leire Corral Barcia, Audric Guillemin from Adevinta Ventures. #marketplaces #b2bmarketplace

Interesting read with your afternoon espresso ☕️ "a16z has long had an investment theory that we should invest behind strengths of a business model and opportunity, not lack of weakness. Instacart is a case study of this. Focusing on the former was key to our investment decision." Jeff Jordan #venturecapital #venturefunding #venturecapitalists #startups Andreessen Horowitz

🔍 Pitch Deck Review: Insights from Viable and Footprint 🔍 I recently reviewed two pitch decks featured in Business Insider: 1. Viable: A London fintech helping e-commerce companies track their finances raised $3M. 2. Footprint: A startup revamping client onboarding for Wall Street raised $13M. Both decks are notable for their minimalist designs—clean black on white or grey backgrounds with minimal use of color and icons. They also effectively highlighted current customer traction, a crucial element for any successful pitch. Here are some observations: - Viable addressed their Go-to-Market (GTM) strategy but could benefit from more detailed execution plans. - Footprint presented a clear overview but didn't include a detailed plan for scaling the business. A solid GTM strategy is vital in a pitch deck. It not only shows how you plan to enter the market but also provides investors with confidence in your business’s scalability and long-term potential. If you're preparing a pitch deck, make sure your GTM strategy is clear and detailed to stand out to investors. #pitchdeck https://lnkd.in/dYTGNfKK https://lnkd.in/dS7WQxP7

Launching my first e-commerce venture in 2021, I was thrilled with sign-ups but dismayed at sales. It took me a while to crack the code. Many startups focus on amassing huge user bases rapidly. Yet, they struggle to convert these users into paying customers. This isn't the way forward. ⚠️ For TRUE acquisition: ⚠️ One key "hub" offering (like a limited-time discount), Several engaging "spokes" (ads, blogs, social media posts) to create an engaged community. A compelling call-to-action leading from Spoke → Hub, And a solid follow-up strategy to keep them engaged. The result? Not just sign-ups, but loyal customers and a thriving business. 😀 (Photo from the best seller of our first store 🥲)

Over the past year or so, I’ve been working with the team at Packsmith - a tech startup changing the logistics and fulfilment game for ecommerce brands by providing a better, faster, and more cost effective way for brands to get orders to their customers. When I came on board last year the business was pre-product and pre-revenue and I was tasked with launching it in Australia (no biggie 😂) - everything from building the strategy, to conducting discovery research, establishing core vendor partnerships, opening the first distribution centre, creating the first processes and landing the first customers. I’ve launched brands in new markets before but up until this point have had zero experience in tech, but my initial overwhelm was tempered as I spoke to my founder friends about their 3PL experiences. The more I learned, the more I realised how big the problem space is and that the industry was ripe for disruption. I also knew that the Packsmith team - who come from companies like Uber, Google, Meta, and Apple - were the team to do it 💪🏼 Working with the business as they’ve raised over $6.8USD from leading US investors like Bessemer Venture Partners, Interplay and Sophia Amoruso’s Trust Fund has been no joke. I thought retail was fast 😂, but nothing compares to the pace of a tech startup as it moves through launch, to finding product-market fit, and realising exponential growth. It’s a magical time in a startup’s life and it’s so fun to be a part of it ✨ If you’re an ecomm founder looking for a better way to run your logistics and fulfilment, shoot me a DM. I’d love to chat about how Packsmith could help 🙌🏼

It's both invigorating and terrifying as founders to see potential beyond a visible market, especially when you're constantly defending a point of view to investors with confirmation bias. Many people talk about the patterns they see in markets, and while I agree and hold value in the expertise of people who see hundreds of deals weekly, I also think that sometimes they're looking at the wrong patterns. This was a fantastic video addressing just that (thanks for sharing Harman Kochar!) 🍦 The scoop Tobias Lütke, founder of Shopify, discusses his experience with pitching the early concept of Shopify to VCs on Sand Hill Road. Initially, they weren't interested in investing because they perceived the market for online stores as too small—estimating only 40,000-50,000 existing online stores. They doubted that capturing even half of this market would constitute a venture-scale opportunity. Years later, with Shopify's valuation nearing $100 billion, one of these VCs revisited his decision, questioning what he had missed. They had accurately assessed the market size but failed to recognize that the limited number of online stores was a symptom of the very problem Shopify aimed to solve. Lütke shared, "The reason there was only 40,000 online stores was because it was hard, expensive, and everyone who tried ran into all these brick walls of complexity, which Shopify, one after another, smoothed over and made simple to do.” 📊 The takeaways: 🌏 Opportunity in Markets That Sound Small: A compact market size often signals hidden opportunities waiting to be unleashed. 🌏 Friction Reduction = Growth: Streamlining complex processes can dramatically open up market potential. 🌏 Expanding Market Limits: Innovative solutions can transform apparent market boundaries into new frontiers for growth. The removal of friction, is a crucial, yet often underestimated force that shapes markets. Similar to Shopify, there are shifts in the fashion industry that will unlock opportunities for scale while building into a circular economy. At alternew, Rachel Sterling and I are part of a $6B clothing alterations market, but that's with the flaming hoops we currently have to go through with fragmented markets, barriers to entry, and few standards in experience. With massive trends in sustainability, secondhand vintage, and right to repair, it means more of the 300 billion already spent on fashion, will go to post-purchase fashion services and the brands that provide them. Overall, find the people who invest in your why.

Introducing Skio, an innovative game-changer in the world of e-commerce, today's spotlight in our #YCombinatorSpotlight series. Based in San Francisco, Skio (skio.com) is the force revolutionizing how brands sell subscriptions on Shopify. By bringing an end to the frustrations and inefficiencies of traditional subscription services, Skio makes selling subscriptions smooth and hassle-free, letting brands focus on what they do best – creating exceptional products. Skio’s technology has been adopted by a diverse range of leading brands such as Liquid I.V., Bulletproof, Milk Bar, Vega, KOS, KITSCH, Wild One, and many others. Their client list is as impressive as it is varied, reflecting Skio's broad applicability and effectiveness. Behind Skio’s success is a powerhouse team of 33 full-time employees (skio.com/team), bringing experience from major companies including Shopify, Recharge, Klaviyo, Attentive, Amazon, Facebook, Pinterest, Hulu, Nacelle, Smile.io, Groupon, Databricks, and Y Combinator. This diverse and dynamic team is committed to delivering a world-class product, and their collective experience forms a significant part of Skio's unique offering. With $8.4M raised in investment (skio.com/investors), Skio’s financial backing is equally impressive, featuring Y Combinator, Adjacent, and individuals such as Jason Wong, Shaan Puri, Julian Shapiro, Geoff Woo, & Sahil Bloom. These investors are joined by founders and executives of companies like Italic, Magic Mind, Immi, Bev, Smile.io, Okendo, Wonderment, Archive, Parker, HVMN, & MuteSix, demonstrating widespread support and belief in Skio's vision and potential. Skio has quickly become an influential player in the e-commerce space, and we're excited to watch their journey unfold. For more information about Skio, visit their website: https://skio.com/ #Skio #Ecommerce #Subscriptions #Shopify #Innovation #Investment #Startups #YCombinator