BigCommerce Not Selling: Revitalizing
What Are the Key Insights from Oppenheimer’s Research Note?
A new research note from Ken Wong, CFA at Oppenheimer sheds some light on what's happening at BigCommerce at the moment from an interview with their CFO. Here are a few facts uncovered in the research note:
Most significantly, the company has told Wall Street it is no longer for sale.
There are still fewer replatforms right now than you might expect, consistent with RMW Commerce research, due to capital constraints and risk tolerance.
New leadership has increased focused up-market, which means a focus on size of enterprise contracts, not the number.
Transaction volume is steady reflecting a consumer that is still buying, even if there are category shifts.
Payment flexibility needed in the large Enterprise market across multiple geographies.
B2B expected to be a larger grower than the rest of the business.
Why Is BigCommerce Not the Best Fit for Private Equity Right Now?
A few thoughts on the situation:
While it has been widely reported for years, even by me, that BigCommerce seems a better fit for private equity, now is likely not the time. Private equity requires more profitability and more growth than BigCommerce can currently deliver. A private equity acquisition now would be more of a mercy killing leading to a much smaller BigCommerce, and may not be in anyone's best interests.
Why Is This Not the Best Market to Sell BigCommerce?
In truth, this is probably not the best market to sell in at any rate -- private equity activity is down, and why do you hire a big GTM-oriented exec if 10 minutes later you sell the business?
You would have hired a restructuring or sale expert instead. Or Brent would have done this on his own. In truth, the market tied their hands in any event, and you are where you are. In any scenario, you need to grow. The company is much better off with the new President than without one.
What Is the Current Interest in Replatforms Among Customers?
There is healthy interest in replatforms in my own customer base, but the road to a business case is slow and arduous. What to do first, why, when, and for what results being the biggest questions that CFOs are expecting answers to.
Why Does BigCommerce Still Have Opportunities in the Market?
There are still only a few scaled SaaS platforms in eCommerce in the mid-market, BigCommerce being one of them. This alone should give them opportunities that others have. Whether you consider BigCommerce or Shopify (the two most popular alternatives), if you are coming from Salesforce your total cost of ownership is going down. And I have seen customers use this as a replatform motivator.
What Is the Future of BigCommerce?
Management is doing some restructuring and goal updates to reset GTM.
I expect going forward that BigCommerce will become more and more a B2B company, with a tightly-defined B2C ICP focused around payments and other flexibility on a SaaS platform (though Shopify keeps making this more difficult). Over time, a company tends to look more like its largest growth segment - and for BigCommerce that is B2B by a wide margin.
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