When Frank Poore started CommerceHub in the late 90s in Albany, New York, he needed $10,000 to get the business off the ground. After approaching Glenn Rockwood, the then-President of Fillpoint, a video game distribution company, to fund his dream, Poore wasn't expecting much. In fact, when Rockwood asked how much he needed, Poore humbly asked for whatever he could give. He was offered $100,000, and from there, Poor learned a valuable lesson about dreaming bigger.
This moment has informed Poore's business decisions ever since. It's a poignant moment to look back on as CommerceHub prepares for a possible initial public offering that could value the company at $2 billion.
It would be the second time that the e-commerce company went public. CommerceHub had been listed on Nasdaq for almost two years until it was sold to GTCR and Sycamore Partners for $1.1 billion in 2018.
However, this time, things are a little different.
Primarily due to the global pandemic, CommerceHub has ended up being at the center of online shopping today.
"You're probably not buying new shoes, a new coat, a new wardrobe. You've got nowhere to go," quips Poore. He's right. While online shopping has spiked, there has been a significant shift in what people are buying. Poore expects retailers to focus on essentials as people continue to shop online to avoid swaths of people and stores.
CommerceHub's cloud-based platform has facilitated retailers like Walmart, BestBuy, and QVC to ship products directly from distributors to customers. When an order is placed and shipped from the supplier to the customer, it appears that the product came straight from the retailer. It's a key component of its software and logistics engine that helps companies compete with Amazon.
The company currently works with 12,000 retailers, suppliers, and distributors. In the last year alone, CommerceHub processed around $20 billion through its platform. However, the COVID-19 outbreak and the subsequent shift to online shopping has helped the company achieve more than 100% year-over-year increase in the volume of orders handled by CommerceHub in April and May. For the company, this activity is akin to "peak holiday season levels."
Poore's $10,000 idea has served him greatly, and while CommerceHub may not be a widely recognized name, it's powering some of the biggest retailers in the world.