Ecwid, an e-commerce platform originally founded in Russia that lets merchants create online stores on social networks like Facebook, their own websites and on mobile, is today announcing a $5 million round of funding. The Series B investment was led by Russian VC iTech Capital, with participation also from Runa Capital, which led its last round.
Jim O’Hara, Ecwid’s US-based president, tells me the money will be used to expand Ecwid’s platform — specifically, to add more functionality to make it easier for any merchant to enable cloud-based transactions.
The startup today has some 500,000 merchants on its platform across some 175 countries. It has grown by some 50,000 since April, when it revealed during Facebook’s F8 developer conference that it would work in partnership with Facebook to make it easier for people to buy things on the social network — by way of an autofill of payment details that are stored on Facebook.
That number was given an injection in January 2013 when Intuit bought e-commerce platform Payvment but didn’t pick up its existing business. Ecwid instead took on Payvment’s 200,000 merchants.
Ecwid competes against larger and better-funded companies like Shopify and Bigcommerce, and like them it offers extensive integration with marketplaces. Where it differs, O’Hara says, is in how it takes its product to market. It is built on what O’Hara describes as a “true freemium” model, where a merchant can pay nothing to use the service if it is selling 10 items or less. That’s not on a trial basis and is “forever free”, he says. Thereafter, pricing and more features kick in.
No word on how many merchant customers are converting to paid except that Ecwid is “executing very well” and is “above the industry average” for businesses converting on the freemium model.
Although Ecwid is working with merchants to build e-commerce options on mobile and desktop sites, and to expand that into point-of-sale options, one of the areas where Ecwid has seen some especially good traction is in social commerce. It’s currently considered the biggest e-commerce partner for Facebook, in that some 50,000 of its merchant customers have built stores on the social network.
Facebook commerce has yet to really kick off compared to sites more specifically geared to e-commerce — portals/aggregators like eBay and Amazon, and of course specific online shops for brands and retailers. Like these other sites, it may ultimately be that scale will win the day.
Which leads to another question: is Ecwid eyeing up doing more on Twitter, which is known to be expanding its own ambitions in social commerce? And what about Pinterest, the image-based idea-sharing site that seems like a no-brainer for commerce services but has yet to launch any.
On Twitter, O’Hara says Ecwid is “actively monitoring it, but we are not getting a lot of active demand fem merchants yet.” In any case there would still be long way to go to replicate the kind of experience Ecwid is offering on Facebook, where the social network has opened up its network to Ecwid.
And no comment on what may be happening with Pinterest — which of course makes me thing something is happening. “It would be our objective to be available on all social platforms,” O’Hara notes cryptically.