INTERNET, EVERYWHERE— Shopify is swapping out two of its top leaders, as the commerce company continues to adjust to the post-pandemic retail landscape. Kaz Nejatian is now COO, with Jeff Hoffmeister set to become CFO next month. Here’s what you need to know:
Operation C-Suite Overhaul: Nejatian remains the company’s vice-president of product for merchant services. He originally joined in September 2019 to lead Shopify’s financial solutions group, which runs its money-spinning payments processing service and merchant cash-advance offering. It’s since launched newer features like small-business banking, while Nejatian has also overseen the add-ons the company sells its merchants, like shipping and point-of-sale hardware.
Shopify CEO Tobi Lütke holds product close, retaking the reins of that part of the business in an earlier executive shuffle in September 2020. Before Shopify, Nejatian was a product manager at Facebook, putting payments into the social media giant’s suite of apps, after selling his own, soundalike fintech startup Kash. He’s also a former federal Conservative staffer, having worked for then-immigration minister Jason Kenney.
Nejatian replaces Toby Shannan, a long-serving executive who joined Shopify in June 2010, when it was still called Jaded Pixel Technologies; he’ll take a board seat next year. It leaves Lütke and now-president Harley Finkelstein as the only remaining members of the executive team that took the firm public in May 2015.
Financial flip: Hoffmeister will take over from Amy Shapero, following Shopify’s third-quarter earnings report on Oct. 27. Hoffmeister currently leads tech banking for the Americas at Morgan Stanley, the lead underwriters on Shopify’s IPO and a frequent presence on subsequent offerings. Shapero joined in April 2018 from Betterment, the New York-headquartered roboadvisor, succeeding early CFO Russ Jones. Both Hoffmeister and Nejatian will report to Lütke.
The market reaction: Shopify shares were up more than one per cent in early afternoon trading on the New York Stock Exchange. But Hoffmeister in particular will take the financial reins with Shopify’s pandemic-stock success story firmly in the past. Its shares opened Thursday down 82.7 per cent from its mid-November, all-time high.
The analyst reaction: Shopify’s C-suite additions appear to be “highly competent leaders with strong track records,” wrote National Bank Financial Markets managing director Richard Tse in an investor note, although he noted it’s difficult to gauge whether they’ll have a material impact. Tse also questioned “whether all the executive changes are complete—we’d bet there’s likely more to come as we approach [third-quarter] results.”
Shopify has “this view of bringing in the best people, to broaden the way they think about the platform going forward,” Tse said in an interview. With a major fulfillment play to deliver, merchant customer-acquisition challenges to address and internal upheaval following layoffs, the new executives will have plenty to do.