No-code development platforms (NCDPs) aim to give power to individuals to realize their software ideas, regardless of technical skill and know-how. To do that, these platforms utilize familiar functions such as drag-and-drop, filters, data queries, widgets and application programming interfaces (APIs), to create software without the need to write a single line of code. NCDPs have so far disrupted business applications, mobile applications, and websites.
Wix reported an increase of 31 million registered users in 2020 (only 23 million were added during 2019) along with 995,000 net premium subscription additions (516,000 additions in 2019).
Shopify’s revenue grew 86% YoY in 2020, while the Gross Merchandising Volume sold via its platform rose 96% YoY in 2020.
BigCommerce’s revenue rose 35.9% YoY in 2020.
Zephyr and Shogun raised funding in 2020 and reported significant revenue growth.
Airtable, Ushur, and Unit21 raised funding during 2020 and noted that the Covid-19 pandemic increased business growth and demand.
Unqork partnered with the city of New York to build and launch a Covid-19 crisis management platform backed by CapitalG (Alphabet) and BlackRock.
The NDCP industry is dominated by workflow automation, business application and web application and e-commerce segments, attracting most funding with more startups being in early and growth stages. Notably, the workflow automation and business application segments had slightly higher composition of early and growth stage startups compared to the web application and e-commerce segment.
Shopify is the largest company on our disruptor list with over USD 2.0 billion in 2020 revenue and a market capitalization of over USD 180 billion (August 2021). Wix, Squarespace, and BigCommerce, which are both publicly traded, also make our list of disruptors.
Among private companies, leading workflow automation provider Klaviyo had received the most funding as of August 2021, along with business application tools Airtable and Unqork.
Shopify is a platform for users (mainly SMEs) to create e-commerce websites. Merchants can use the software to design, set up, and manage their stores across multiple sales channels, including social media, marketplaces, brick-and-mortar locations, and pop-up shops. Shopify’s platform offers a range of services including marketing, customer engagement, payments, and shipping tools, among others. It also has an application programming interface (API) platform and app store which allows developers to create applications for Shopify online stores. In May 2015, the company was listed in the NYSE, raising USD 131 million. Shopify generated revenue of USD 2.9 billion in 2020, and turned profitable in Q3 2020, with an operating profit of USD 90.2 million in 2020. Moreover, as of March 2021, the platform had over 1.7 million users.
The company gains an edge over peers through its merchant solutions and value-adding offerings to clients, such as shipping discounts (discount rate varies with the package). Merchant solutions include facilities needed to augment the subscriptions including accepting payments, shipping, and fulfillment, and securing working capital, among others. Merchant solutions accounted for 71.4% of the company revenue in 2020, and played a part in Shopify reporting a strong revenue growth of 85.6% year-over-year (YoY).
Shopify charges its users a monthly charge (starting at USD 29 per month) which varies based on the features they require. Moreover, Shopify also operates an app store, for developers to sell apps to merchants. In June 2021, the company noted that it reduced the commission it charges from app developers to 0% from 20%, for those that earn less than USD 1 million annually.
As of April 2021, The company had a large customer base of around one million businesses, based across 175 countries. Although the company focuses on small businesses, large enterprises such as Tesla, Red Bull, and Nestle are also among their customers.
Shopify has benefited from the pandemic and is likely to continue to expand its customer base going forward. For instance, new stores created on Shopify grew 71% quarter-over-quarter (QoQ) in Q2 2020, helped by the company increasing its free trial period to 90 days (from 14). Moreover, monthly recurring revenue (MRR) amounted to USD 82.6 million as of December 2020, up 53% YoY. Gross merchandise volume (GMV) also rose 99% YoY and reached USD 41 billion in Q4 2020.
In May 2021, Shopify announced that its platform would integrate with Google to allow merchants on the platform to reach consumers through Google services, including Search, Maps, Images, Lens, and YouTube. This was an addition to Shopify’s integrations with large global platforms, which already included Facebook and TikTok. In August 2021, the company expanded its partnership with TikTok allowing merchants to add a shopping tab to their TikTok business profile and create virtual storefronts that can be synced with their product catalogs. In addition to this, the company plans to pilot “TikTok Shopping”, TikTok’s e-commerce service, among particular Shopify merchants across the US, UK, and Canada.
Shopify acquired Primer, an augmented reality (AR) technology provider, in June 2021. Primer’s AR tech lets users view the potential impact of home improvements such as tiles, patterns, wallpaper, and paint on their mobile devices by mimicking the real lighting conditions, textures, and sheens. Through the acquisition, Shopify absorbed Primer’s team of eight employees and intends to use Primer to complement its own AR integrations, such as allowing sellers to embed 3D models into their storefronts. This is in line with its claim that AR content can lead to a 94% higher conversion rate.
Web Sites and e-commerce applications:
Spreadsheets, databases and data science:
Big tech companies and cloud platforms are still new to NDCPs. For big tech companies such as Apple, Google and Microsoft, NDCPs (commonly based on the platform-as-a-service business model, or PaaS) are a potential revenue line. Big tech’s current legacy developer platforms have not yet gained the kind of traction that disruptors have.
PowerApps is Microsoft’s legacy NDP for building business applications. It is less used than disruptor platforms, due to its reported poor ease of setup/use and shortcomings in data synchronization, platform compatibility, and workflow design. May 2020 saw the launch of “Microsoft Lists”, a smart-tracking app with which users can monitor issues, assets, routines, contacts, inventory, etc., with integrations, smart rules and alerts. Airtable has since accused Microsoft of copying its collaboration service.
In September 2018, Microsoft acquired Lobe, a startup that enables users to build machine learning (ML) models using a simple drag-and-drop interface. Lobe, based in Silicon Valley, was founded by Mike Matas, Adam Menges and Markus Beissinger. Mike Matas is a former designer at Apple, who worked on the user interface of the first iPhone and the iPad. Prior to Lobe, Microsoft acquired Bonsai.ai, Semantic Machines and Maluuba, which confirms their intentions of building easier machine learning models for users. Microsoft did not disclose the deal value. In October 2020, Microsoft announced the public preview of the app, where it can be downloaded for Mac or Windows for free.
In August 2021, UpGuard, a cybersecurity firm, reported that the lack of proper security measures taken by Microsoft in relation to PowerApps led to the exposure of data from 38 million records. The information exposed included a range of personal information, including Covid-19 contact tracing information, social security numbers (SSN) for job applicants, employee IDs, as well as names and email addresses, among others.