Baron Fifth Avenue Growth Fund on Shopify Inc.
Thesis
The Fund believes concerns that AI-driven applications will weaken Shopify's position in e-commerce are misplaced and instead sees the company as an AI beneficiary. Shopify possesses two decades of proprietary data across millions of merchants that can be used to create AI tools that improve merchant outcomes. New products are embedding Shopify more deeply into agentic commerce while creating additional monetization opportunities. The Fund continues to view Shopify as the category-defining modern commerce platform, supported by secular digital-retail growth, expanding merchant solutions, improving free cash flow, and a widening competitive moat.
“We view those concerns as misplaced and see Shopify as an AI winner.”
Key risks
- E-commerce activity could increasingly shift from traditional websites toward AI-driven applications.
- Investor concerns about Shopify's positioning in agentic commerce could continue to pressure its valuation.