Logistics software start-up Flexport has tapped US-listed Canadian multinational e-commerce company Shopify for fresh capital.
The digital freight forwarder said it had raised $260m from an uncapped convertible note. No further financial details were disclosed.
“Since I came back to the role of CEO, our team has made massive progress toward returning Flexport to profitability,” said Flexport chief executive Ryan Petersen.
“Further strengthening our cash position with this investment should send a strong message to customers that Flexport is building a long-term sustainable business that will continue to deliver best-in-class technology and services for global businesses.
“This is an important milestone along our journey to build an end-to-end logistics technology platform to make global commerce so easy that there will be more of it,” he added.
With convertible note financing, a cap is often placed on the valuation at which the note will convert into equity, providing some level of protection to the investor as it sets a maximum company valuation at the point of conversion. Uncapped means there is no such limit.
Petersen said Flexiport’s “fortress balance sheet” continues to be one of the company’s “most strategic assets” as it navigates the uncertain waters of global trade.
Shopify already holds a “significant equity interest” in Flexport having participated in a $935m series E investment round in February 2022.
In June 2023, it sold its former Shopify Logistics business to Flexport receiving an additional 13% equity interest in the San Francisco-based company.
Ottawa-based Shopify describes itself as a “leading global commerce company” that provides essential internet infrastructure for commerce.
The fundraising marks a positive start to the year for Flexport, which last year was forced to slash 20% of its workforce and saw the departure of a high-profile CEO.
Flexport is one of the most prominent start-ups in the US, having raised more than $2bn in funding and at one stage notched a valuation of $8bn.
