Difference Between Gumroad and Shopify (With Table)

E-Commerce and Online Platform are very popular terms nowadays. E-Commerce means selling products or buying the products via the Internet. E-commerce or Electronic Commerce works on several technologies such as Internet marketing, mobile commerce, electronic funds transfer, online transaction processing, supply chain management, electronic data interchange (EDI) etc. Two such Companies which are E-Commerce and works on an online platform are Gumroad and Shopify.

Gumroad vs Shopify

The difference between Gumroad and Shopify is that Gumroad provides a platform for all the creators and artists who want to sell their products by earning money. While Shopify is a platform for retailers and shopkeepers who can sell their products to customers and company provide them with security, paying options etc. Gumroad was started in the year 2011 by Sachin Khanna and Sahil Lavingia. Whereas Shopify was started in the year 2006 by Tobias Lutke.

Gumroad is a company that is known for digital distribution, self-publishing etc. Its motive is to provide facilities to all the creators, artists, writers etc., a platform to sell their products. The sale of products is made directly via a creator to customers. The company Gumroad was founded by Sahil Lavingia and Sachin Khanna in the year 2011. To make selling so easy that it will be like social sharing. Gumroad has a very simple checkout process, unlike other companies which ask for too many details. 

Shopify is a multinational company based in Ottawa, Canada. It is an e-commerce company that sells its product globally. This company provides its platform for online retailers, stores, shopkeepers to sell their products. It also offers various services to them, such as marketing, shipping, payments, and customer engagement tools. According to research, almost 1.5 million websites of different online stores can be found in Shopify. It was launched in the year 2006, 15 years ago by Tobias Lutke and Scott Lake.

Comparison Table Between Gumroad and Shopify

Parameters of ComparisonGumroadShopify
FounderIt was founded by Sahil Lavingia in 2011.It was founded by Tobias Lutke in 2006.
HeadquartersIt is situated in San Francisco, USA.It is situated in Ottawa, Canada.
IndustryIt deals with music, films, digital distribution, self-publishing, and e-commerce.It is an e-commerce industry. 
RevenueIt has a revenue of almost $9.2 million.It has a revenue of almost $2.93 billion.
No. of EmployeesIt has just 33 employees in the company.It has 7000+ employees in the company.

What is Gumroad?

Gumroad was designed and created in only 1 week by its founder Sahil Lavingia. The idea of making a company like Gumroad come to Sahil’s mind when he saw that back in 2010-11, there was no medium or platform through which any single creator, artists, designers, authors etc., could sell their products easily and conveniently. It took a lot of time to sell products directly to consumers. So he decided to make selling so simple and easy as sharing web content. 

Gumroad uses the technique of plug-and-play, which means that it is a single computer bus without any physical configuration which offers file hosting and delivery, payment processing, communications tools and consumption experiences, marketing for a variety of services. The marketplace of Gumroad is decentralised. 

When it was launched originally, then it charged very less fee when compared to other commerce platforms. But later, it changed its fees structure charging monthly fees for hosting and additional charges for transactions.

There are many eminent and popular creators, musicians, models who had sold their products through Gumroad. They are Bon Jovi, Eminem, Garth Brooks, Girl Talk, Ryan Leslie, Sara Bareilles, Wiz Khalifa, David Banner, and Sam Hyde. Publishing Books is one of the largest fortes of Gumroad. It has published bestseller authors like John Green, Tim Ferriss, Chris Guillebeau etc. 

The CEO of Gumroad is currently Sahil Lavingia. It is a very small company with only 33 employees. But they try to cater needs of every customer. Gumroad’s support system is very good.

What is Shopify?

Shopify was earlier started as an online store for selling snowboarding equipment under the name SnowDevil. Then, Tobias Lutke, its founder, changed its name to Shopify in June 2006. In the year 2009, the company launched an API known as Application Programming Interface, which allows developers to create their applications for their online stores on Shopify and then sell them. 

In 2010, they launched their mobile application on the app store, which allowed sellers, store owners to keep an eye on and manage them. Shopify became one of the fastest-growing company in Canada. It received a capital financing of $15 million in 2011. Shopify also acquired companies like Select Start Studio(S3), Oberlo, Bolt made and Jet Cooper. In 2013, it launched its own payment company, which directly uses credit cards to make payments for merchants without the interruption of a third party. 

Shopify runs globally, expanding its root to 175 countries. It has 1.58 million websites running on Shopify platforms. It has more than 7000 employees. Its gross merchandise volume in total exceeded US$61 billion. In today’s time, Shopify has become one of the largest publicly traded in market capitalization in Canada. Now, it is generating companies revenue of about US$2.929 billion.

Main Differences Between Gumroad and Shopify

  1. Gumroad was founded by Sahil Lavingia and Sachin Khanna in 2011. Shopify was founded by Tobias Lutke, Daniel Weinand, Scott Lake in 2006.
  2. Gumroad is situated in San Francisco, USA. Shopify is situated in Ottawa, Canada.
  3. Gumroad deals with music, films, digital distribution, self-publishing, and e-commerce. Shopify is an e-commerce industry with millions of websites. 
  4. Gumroad has a revenue of almost $9.2 million and is a small company. Shopify has a revenue of almost $2.93 billion and fastest-growing company.
  5. Gumroad has just 33 employees in the company and focuses on every client. Shopify has 7000+ employees in the company and works in about 175 countries.

Conclusion

Both the companies Gumroad and Shopify are e-commerce companies. But their platforms are used for different needs and by different sections of people. Gumroad is a company founded by an Indian-American man when he was just 22 years old. Whereas Shopify is a Canadian company and it is ranked as a top 10 company in Canada and top 500 in North America. Gumroad has a very less workforce while Shopify is the largest and growing speedily over time.

References

  1. https://link.springer.com/chapter/10.1007/978-1-4842-2829-6_5
  2. https://link.springer.com/chapter/10.1007/978-1-4842-2829-6_7
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