Amid California sales tax kerfuffle, Shopobot relocates to Seattle

Dave Matthews

As a new Amazon affiliate, Shopobot co-founder Dave Matthews found himself in the middle of a big tax fight in California recently. It was a battle they couldn’t win. So, he and his co-founder, Julius Schorzman, packed their bags and moved to Seattle.

“It was these two giants fighting between the State of California trying to get sales tax, and Amazon not wanting to start collecting it. For us, being stuck in the middle, we got cut out of everything,” Matthews tells GeekWire. “Online retailers like Amazon decided they wouldn’t work with companies like us anymore.”

So, what did they do? They moved to the TechStars building in South Lake Union, which happens to be right across the street from Amazon’s shiny new headquarters. And — as it so happens — they hired an ex-Amazon employee as their first employee.

“We are actually growing now that we know where our home base is,” said Matthews.

Now, here’s the ironic thing. A week after they moved, Amazon and California lawmakers entered into a compromise that essentially delayed the sales tax collection issue to 2012.

Matthews laughed when asked about the irony of the situation. But the 33-year-old entrepreneur noted that the tax issue could creep back again in 2012, and because of that they don’t regret the move.

“At least all of that uncertainty is behind us now, which is good, but it is kind of ironic that when we …  finally got here that they decided it was not a good law,” said Matthews, who previously worked at Microsoft.

Shopobot is backed by Google Ventures, AOL Ventures and Silicon Valley angels. The nine-month-old company competes against Decide, the Seattle startup which instructs consumers on the best time to buy phones, TVs and laptop computers. Matthews was very much aware of Decide, and said now that Shopobot is in Seattle they are “looking to turn up the heat.”

Just like Decide, Shopobot offers price comparisons on electronics. But it is also eyeing video games, kitcheware, sporting goods and other categories. The service, which was started at the AngelPad incubator in the Bay Area, is currently in public beta.

Given all of the debate about Seattle’s tech ecosystem in recent weeks, Matthews said he was excited to get to know about the startup community a bit more.

“Now, we get a taste of both. We’ve tried the San Francisco tech hub, and it is very good,” he says. “So, we can’t wait to get to know this one a little bit.”

  • Anonymous

    Welcome to seattle! 

    I’ve used both decide and shopobot (I assume shopbot was taken) and your’s is a lot better but neither of them tie in with product reviews.  Wouldn’t it make more sense to be at the front end of the buying process (decide which models to consider) rather than the back end (finding the best/reasonable price)?  At least that’s what I want to see.

  • Anonymous

    Welcome to seattle! 

    I’ve used both decide and shopobot (I assume shopbot was taken) and your’s is a lot better but neither of them tie in with product reviews.  Wouldn’t it make more sense to be at the front end of the buying process (decide which models to consider) rather than the back end (finding the best/reasonable price)?  At least that’s what I want to see.

  • Anonymous

    Welcome to seattle! 

    I’ve used both decide and shopobot (I assume shopbot was taken) and your’s is a lot better but neither of them tie in with product reviews.  Wouldn’t it make more sense to be at the front end of the buying process (decide which models to consider) rather than the back end (finding the best/reasonable price)?  At least that’s what I want to see.

  • http://www.facebook.com/madefy Dave Matthews

    Hi Joe - thanks for the comment, I’m glad to hear you like the site!  That’s great feedback, because you’re exactly right.. we want Shopobot to be the best site for making any of these big shopping decisions.  We’re working on a new release that’ll be up soon that will make it even easier to find the best stuff.  (and the lowest prices!)

  • http://www.facebook.com/people/Jordan-Schwartz/500051403 Jordan Schwartz

    Welcome home, Dave!

  • http://www.facebook.com/people/Jordan-Schwartz/500051403 Jordan Schwartz

    Welcome home, Dave!

  • http://twitter.com/Vroo Vroo (Bruce Leban)

    Matthews says Amazon “wouldn’t work with companies like us anymore.” Can you provide more details? Do you mean they wouldn’t pay affiliate fees? Or something else?

    One problem it doesn’t look like you solve — same product, different model numbers at different stores. Price tracking/comparison is a lot more meaningful when you can do that.

    • Ldodson

      Then reason for that is that every store can run ‘lowest price’ ad.  If its a different model number, its a different product (technically).  And then multiple stores can claim the lowest price in their advertising

    • http://www.facebook.com/madefy Dave Matthews

      Hi Bruce – that’s exactly the sort of thing that can make online shopping harder than it should be, and that’s where we want to help.  Keep an eye out for our next version coming soon :)

  • Guest

    Amazon and California were arguing over taxes and reached a compromise where they would delay it until next year. What is ironic about that? 

  • Guest

    Amazon and California were arguing over taxes and reached a compromise where they would delay it until next year. What is ironic about that? 

  • Guest

    Amazon and California were arguing over taxes and reached a compromise where they would delay it until next year. What is ironic about that? 

  • http://www.facebook.com/peter.bordes Peter Bordes

    so sorry to hear about Shopobot.com being on the end of the nexus tax stick in CA and having to move. i wish we had gotten you connected to the Performance Marketing Association http://www.performancemarketingassociation.com whos been at the for front of fighting the tax.

    its sad to the the States not understanding that innovative sites like yours and others will leave… CA’s loss is Seattles gain.