ShopIgniter lands $8 million to help retailers establish storefronts on Facebook

ShopIgniter helps Nike on Facebook

ShopIgniter has helped Nike, CafePress and more than 100 other customers establish retail outposts on Facebook. Now, the Portland startup is looking to supercharge efforts. The company today is announcing an $8 million venture capital round led by new investor Trinity Ventures, with participating from existing investor Madrona Venture Group.

As a result of the financing, Larry Orr of Trinity has joined the company’s board. Trinity has latched on to other fast-growing consumer Internet companies from the Pacific Northwest, having previously backed Blue Nile and Zulily. In ShopIgniter, Orr thinks he’s found another winner.

In addition to bringing retail to social networking channels and tying those offerings to social networking channels, Orr said that ShopIgniter allows  individual shoppers to “promote products and influence the purchasing decisions of their friends.” The technology also provides detailed analytics, so retailers can see what’s working in the social networking sphere.

Led by former Madrona venture partner Matt Compton, the 3-year-old company plans to use the funds to grow sales and marketing and enhance product development.

Competitors include Magento and Venda, both of which were founded 10 years ago and help very large brands like Urban Outfitters and JVC build e-commerce storefronts.

Even closer rivals include Resource Interactive and Monsoon.

UPDATE: Brian Walker, an e-commerce analyst at Forrester, sees challenges ahead for many of the entrants looking to capitalize on “social commerce” because as it stands now very few people are buying goods through those channels. He notes:

“My concern here is that Facebook Commerce is a niche which is going to be very difficult for a standalone business to defend, as many commerce platforms are building those extensions. Also, at this point, our clients are telling us there are really no sales through that channel. Social commerce will continue to evolve, so the game is not over, but at this point commerce through Facebook is minimal outside social gaming, this is more about branding at this point.”

Mike Rogoway at The Oregonian reports that ShopIgniter employs 34 people, with plans to add as many as 20 more workers in the next year. Compton tells the Oregonian that there’s a race going on in the social commerce space right now, and that ShopIgniter is looking at possibly acquiring companies in order to keep up with the rapidly changing market.

Here’s more on what ShopIgniter has in store from a blog post by CEO Matt Compton in which he writes that social commerce can’t be “delivered by ‘updating’ or ‘extending’ a 5 to 10 year old traditional ecommerce platform.

  • Anonymous

    As a co-founder of Shopigniter, I am excited to be involved in such a rapidly growing space, and to work with our new partner, Trinity Ventures. Brian Walker has raised some interesting points. I would like to clarify, however, that ShopIgniter has a full-blooded ecommerce capability built for the social web.  This includes robust product merchandising management and APIs to integrate into existing traditional ecomm systems. In addition to enterprise ecommmerce functionality, the platform also contains tools that allow marketers to build viral promotions that drive traffic to either a Facebook storefront or an existing dotcom storefront. These tools incentivize customers to tell their friends about deals using popular social networks in exchange for rewards. This translates into direct revenue for our customers — whether inside or outside of Facebook. Some of our customers do as much as 20% of their business inside Facebook. We hope to continue to push the envelope in the social commerce space with the help of this new investment.