Tobi Lutke, an unapologetic computer nerd with a penchant for tweed caps, has become one of Canada’s newest billionaires by helping small merchants sell online and integrate into Amazon’s Marketplace.
An unapologetic computer nerd with a penchant for tweed caps has become one of Canada’s newest billionaires by helping small merchants sell online.
Tobi Lutke, a 37-year-old German immigrant who built Shopify into one of tech’s hottest stocks, was worth $1.1 billion from company shares, options and sale proceeds in late November, according to the Bloomberg Billionaires Index. He owns almost 9.7 million shares and options in Shopify, equal to about 11 percent of the business.
The CEO, with vivid blue eyes, has cultivated an image as a direct, even-keeled leader who has said he still codes for fun at home.
Tobi Lutke, Shopify chairman and CEO
Previously: He worked on the core team of the Ruby on Rails framework and created open-source software.
Personal: Lives in Ottawa with his wife, Fiona.
Bloomberg, company reports
Lutke, who co-founded the company in 2004, regained his status as a billionaire after Shopify bounced back from a short-selling attack in October. And he’s probably made about $40 million after taxes from selling more than 200,000 Shopify shares since the company went public. A spokeswoman for the Ottawa-based company declined to comment on the CEO’s wealth.
Shopify, which went public on the NYSE in May 2015 at $17 per share, now trades at more than six times that price.
Lutke stands out among the handful of Canadian billionaires, most of whom hail from family firms built over generations. He joins other Canadian billionaires including grocery kingpin W.G. Galen Weston and heirs to the Thomson media fortune, including Sherry Brydson and David Thomson.
The Shopify founder is one of the few billionaires in the country to get rich from Canadian-made tech. BlackBerry Ltd. co-founders Jim Balsillie and Mike Lazaridis were billionaires before the smartphone maker’s value imploded. But others like Uber Technologies Inc. co-founder Garrett Camp and Alibaba Group Holding Ltd. co-founder Joseph Tsai made their billions outside the country.
Lutke now leads a pack of entrepreneurs striving to build the next wave of Canadian tech companies.
Shopify helps small and medium-sized companies set up online stores, and provides tools to make e-commerce as smooth as possible, including payment options, cash advances and integrating into Amazon’s Marketplace. The company has beaten revenue estimates like clockwork quarter after quarter for its first two years as a public company.
It employs 2,000 people and says more than 500,000 businesses use its platform, from well-known brands such as Nestle SA to proprietors flogging ugly Christmas sweaters.
Still, questions about Shopify’s rocket-like growth are starting to emerge. In October, short seller Andrew Left alleged many of the company’s users weren’t successful on the platform and that growth would eventually fall off a cliff. Investors were spooked and the stock dropped 12 percent in a single day.
When the company reported in October that growth of the total amount of goods sold through its platform was slowing, the shares fell a further 14 percent.
Lutke, ordinarily soft-spoken, hasn’t hesitated to strike back. He called Left a “troll” whose claims were “preposterous” but declined to give new metrics to show how many users left the company every month. The shares have since rebounded as Shopify heads into the busy holiday season and equity analysts encourage investors to buy.
Lutke is taking others along on the company’s share surge. His father-in-law, Bruce McKean, a former Canadian civil servant, is one of the largest shareholders with about a 4 percent stake that was worth about $388.5 million at Friday’s close, Bloomberg data show.
When Lutke was building Shopify and expecting his first child with his wife, Fiona McKean, Bruce offered them a place to stay to save money, according to a Globe and Mail profile. McKean wrote checks for Shopify to meet its payroll when cash flow was tight, the story said.
McKean, who keeps a relatively low profile save for a LinkedIn picture that shows him surrounded by his grandchildren, served as an early chairman of Shopify from 2007 to 2010.
Lutke is also involved with a few nonprofit ventures, including some related to coding such as Canada Learning Code, an organization that helps women and other groups who are underrepresented in tech learn digital skills. In a Globe and Mail opinion piece last summer, he argued that it’s “about damn time” kids learned how to code.
That maxim has certainly paid off for him.