Form 4: Shopify Subsidiary Exercises Klaviyo Warrants

Shopify Strategic Holdings 3 LLC, a 10% owner of Klaviyo, Inc., exercised warrants to acquire 344,381 shares of Series B Common Stock.

Summary

• Shopify Strategic Holdings 3 LLC, a wholly-owned subsidiary of Shopify Inc. and a 10% owner of Klaviyo, Inc., exercised warrants to purchase Series B Common Stock.
• The transaction, dated November 14, 2025, resulted in the acquisition of 344,381 shares of Klaviyo's Series B Common Stock at an exercise price of $0.01 per share.
• Following this transaction, Shopify Strategic Holdings 3 LLC beneficially owns 2,410,676 shares of Series B Common Stock.
• Each share of Series B Common Stock is convertible at any time into one share of Series A Common Stock of Klaviyo, Inc., and will automatically convert upon certain events.
• The total number of Series A Common Stock shares beneficially owned (via conversion rights from Series B) following the transaction is 16,284,344.
• The warrants to purchase Series B Common Stock have an expiration date of July 28, 2032.
• The transaction was made pursuant to a contract, instruction, or written plan for the purchase or sale of equity securities intended to satisfy the affirmative defense conditions of Rule 10b5-1(c).
• Shopify Inc. is an indirect beneficial owner and disclaims beneficial ownership except to the extent of its pecuniary interest therein.

Sentiment

Score: 7

Explanation: The filing reports a routine insider transaction (warrant exercise) by a significant strategic investor. It reflects a planned action under a 10b5-1 plan and indicates continued substantial ownership, which is generally positive for investor confidence. No negative news or significant changes are reported.

Positives

• Shopify, a significant strategic partner and 10% owner, continues to hold a substantial stake in Klaviyo, indicating ongoing strategic alignment and confidence in the company.
• The exercise of warrants at a nominal price ($0.01) reflects a favorable historical agreement for Shopify, potentially locking in value from an earlier investment.

Future Outlook

The filing indicates a structured vesting schedule for the remaining warrants through July 28, 2027, suggesting potential future exercises or conversions by Shopify Strategic Holdings 3 LLC. The Series B Common Stock has no expiration date and is convertible into Series A Common Stock at any time at the holder's option or automatically upon certain events.

Management Comments

• Shopify is an indirect beneficial owner and disclaims beneficial ownership except to the extent of its pecuniary interest therein.

Industry Context

This filing highlights the ongoing strategic investment and partnership between Shopify and Klaviyo. Shopify's continued significant ownership stake underscores its belief in Klaviyo's platform, which is a key marketing automation tool for e-commerce businesses, many of which operate on Shopify's platform. This reinforces the strong ecosystem play between the two companies in the e-commerce and marketing technology sectors.

Comparison to Industry Standards

• The exercise of warrants by a strategic investor like Shopify is a common mechanism for early investors or partners to realize value from their initial investments.
• The structure of Series B Common Stock convertible into Series A Common Stock is typical for private equity or venture capital investments that convert upon an IPO or other liquidity event.
• The use of a Rule 10b5-1 plan for such transactions is standard practice for insiders to manage their stock sales or exercises in a compliant manner, mitigating accusations of insider trading.

Related Party Transactions

• Shopify Strategic Holdings 3 LLC, a wholly-owned subsidiary of Shopify Inc., is exercising warrants related to Klaviyo, Inc., where Shopify Inc. is also a 10% owner and has a director relationship. This represents a transaction between related parties.

Stakeholder Impact

• Shareholders: The continued significant ownership by Shopify may be viewed positively, signaling long-term commitment and strategic alignment. The increase in outstanding Series B shares (and potential Series A shares upon conversion) could lead to minor dilution if not already accounted for in fully diluted share counts.

Next Steps

• Remaining shares subject to warrants will vest quarterly in equal amounts through July 28, 2027.
• Series B Common Stock can be converted into Series A Common Stock at the holder's option or automatically upon certain events.

Key Dates

Recommendation

This Form 4 filing details a routine warrant exercise by a major strategic investor, Shopify Strategic Holdings 3 LLC, in Klaviyo. It reflects a pre-planned transaction under a 10b5-1 plan and does not introduce new fundamental information about Klaviyo's operational performance or future prospects. Shopify's continued substantial ownership is a positive signal of strategic alignment, but the transaction itself is not a catalyst for a 'buy' or 'sell' recommendation. Investors should 'hold' and continue to monitor Klaviyo's core business performance and broader market trends.

Keywords

Klaviyo, KVYO, Shopify, Warrants, Series B Common Stock, Series A Common Stock, Insider Transaction, Form 4, Beneficial Ownership, 10b5-1 Plan