Illustration: Shoshana Gordon/Axios
The e-commerce boom, driven largely by internet shopping that can take place with the click of a phone, has become increasingly local, new data shows.
Why it matters: Commercial success online is less dependent on geographic location than ever before.
Driving the news: Stripe, the digital payment processing company, on Monday released a report documenting the dramatic expansion of the internet economy over the past five years.
- A diffusion of talent and capital, accelerated by the pandemic, has facilitated entrepreneurship outside of Silicon Valley and major metros.
- More than 350 cities, according to the report, are now home to businesses that collectively process more than $100 million in transactions annually using Stripe.
- In 2017, there were only 50.
What they’re saying: “We’re seeing a lot of growth in the e-commerce economy,” Emily Glassberg Sands, head of information for Stripe, tells Axios. “But the biggest step function change has been traditionally offline businesses lighting up online.”
- “These could be farmers, truck drivers, barbers,” she says. “There are whole industries waking up to the internet and finding resiliency through online financial services.”
Zoom in: The Stripe report noted that the rise of internet commerce has been most pronounced in “non-traditional tech centers.”
- Columbus, Ohio, for example, saw the amount paid via transactions on Stripe increase by 40 times over the past five years.
- Richmond, Virginia – no slouch – saw its volume increase twentyfold.
The intrigue: Rural areas are witnessing growth, too. In the country’s five least populous counties, there is now one Stripe business for every 36 people.
- “We’re really excited about how distributed this growth is,” Glassberg Sands says. “We’re seeing more equal opportunity to create a company wherever you are, to get started quickly and to have access to a broad range of customers.”
What’s next: Morgan Stanley forecasts that the e-commerce boom is likely to continue.
- “We believe that the COVID-driven bump will not flatten future e-commerce growth,” Brian Nowak, a Morgan Stanley equity analyst, said in a statement. “Across the world, we have yet to see a ceiling for e-commerce penetration.”
Editor’s note: This story has been updated to correct that the amount paid via transactions on Stripe — rather than online transactions — increased by 40 times over the past five years in Columbus, Ohio.