Sacra estimates Shopmonkey hit $45M in annualized recurring revenue (ARR) in 2023, up 55% from $29M in 2022.

Shopmonkey generates revenue through two main streams: SaaS subscriptions starting at $200-400 per month for independent shops and enterprise pricing for franchises, plus payment processing fees of 2.5-2.9% on transactions. With the average repair shop generating $720k in annual sales, Shopmonkey can earn up to $18k per year in payment processing revenue from each customer.

The company serves over 5,000 auto repair shops across the US and Canada, representing just 2% penetration of their addressable market of 230,000+ shops. Recent expansion into adjacent verticals like landscaping and pest control through acquisitions, combined with new financial products like working capital loans and BNPL, has expanded their total addressable market from an initial $440M to over $2B.

Shopmonkey was founded in 2016 by Ashot Iskandarian, a Silicon Valley product manager and car enthusiast who observed auto repair shops struggling with pen-and-paper systems and outdated software. With initial funding of $75,000 from friends and family, he recruited Ukrainian engineer Yuri Khmelevsky to build the first version of the product.

Shopmonkey found product-market fit as an all-in-one shop management platform for independent auto repair shops, particularly those with 1-3 locations looking to modernize their operations. The founding team spent their first year acquiring 100 initial customers through direct sales and iteration on the product.

The core product is a cloud-based system that manages the entire auto repair workflow. Shop owners use a dashboard to track jobs from estimate to completion, while technicians access customer and vehicle information through a mobile app in the field. The platform handles scheduling, digital inspections, and customer communication through a unified interface.

For service advisors and front desk staff, Shopmonkey provides digital tools for creating estimates, managing appointments, and sending automated customer notifications. Technicians can document repairs with photos and notes, while shop owners gain visibility into their operation's efficiency through real-time reporting and analytics.

The platform has expanded to include specialized modules for tire shops, heavy duty vehicles, and marine repair, while maintaining its focus on streamlining operations for independent auto service businesses.

Shopmonkey is a vertical SaaS platform for auto repair shops that combines core business management software with integrated payments processing. The company offers tiered subscription pricing ranging from $125-425 per month, with enterprise plans available for larger multi-location businesses. Additional users can be added for $20 per month each.

The platform's core offering includes essential features like digital estimates, invoicing, scheduling, and inventory management. Higher tiers add capabilities like digital vehicle inspections, parts ordering integrations, and technical repair guides. Shopmonkey generates revenue through both software subscriptions and payment processing fees, charging 2.5-2.9% plus a small fixed fee per transaction for both online and in-person payments.

Shopmonkey's competitive advantage stems from its focus on modernizing traditionally pen-and-paper auto repair workflows while enabling new revenue streams through integrated financial services. The company has expanded beyond pure software to offer working capital loans to shops and plans to launch buy-now-pay-later financing options for customers. This creates a virtuous cycle where payment processing data helps inform lending decisions while financing helps drive more repair volume through shops.

The platform targets both independent repair shops and larger franchises, with specialized enterprise features for multi-location businesses. This allows Shopmonkey to grow both by adding new shops and expanding revenue per customer through additional services.

Shopmonkey operates in the auto repair shop management software market, which includes both legacy players and newer cloud-based entrants targeting the 230,000+ auto repair shops in the U.S.

Mitchell1, founded over a century ago, remains the dominant player with its on-premise software suite for repair estimates, parts ordering, and shop management. Their software is widely deployed but relies on older technology stacks and closed systems that don't easily integrate with modern cloud services or payment systems.

Several well-funded startups are pursuing similar cloud-first approaches to Shopmonkey. Autoleap, backed by Bain Capital with $23M raised, differentiates by offering integrated marketing tools and fleet management capabilities. Shop-Ware ($15M raised, backed by Insight) focuses on serving multi-location shops and B2B customers but notably lacks integrated payment processing. Tekmetric, backed by Susquehanna Growth Equity, has gained traction with 3,000 customers through specialized features for managing multiple shop locations.

Square and other horizontal payment/POS providers have started building industry-specific features for auto repair shops, leveraging their existing payment infrastructure and small business relationships. While they offer lower pricing on payment processing, they lack the deep workflow automation and industry-specific features of dedicated platforms.

The market remains highly fragmented - Shopmonkey's 5,000 customers represent only about 2% market share, suggesting significant room for multiple players to grow as the industry transitions from pen-and-paper to digital systems. The key differentiator among competitors has become the ability to combine payments, lending, and industry-specific workflow tools into a single platform.

Shopmonkey has tailwinds from the digitization of auto repair shops and private equity roll-ups of trade businesses, with opportunities to expand into adjacent markets through both horizontal and vertical integration.

Private equity consolidation driving growth

The rising trend of PE roll-ups in trades has been a major tailwind, with total buyout deal value growing from $200B in 2020 to $600B in 2021. As PE firms acquire and consolidate auto repair shops, they seek software solutions to optimize operations and get unified metrics across their holdings. This benefits Shopmonkey through both increased seat expansion within existing accounts and lower customer acquisition costs.

Financial services expansion

Shopmonkey has already expanded beyond core SaaS by adding payment processing, working capital loans, and plans for BNPL in 2023. The company processes payments for shops averaging $720k in annual sales, generating up to $18k in incremental revenue per customer from payment processing alone. Additional financial services like insurance, payroll, and fleet cards represent significant expansion opportunities.

Geographic and vertical expansion

While currently serving 6,000 of the 230,000 US auto repair shops, Shopmonkey has begun expanding into Canada and adjacent verticals like heavy duty vehicles, marine repair, and tire shops. The company's acquisition strategy, having completed 9 deals to expand across trades, provides a proven playbook for entering new verticals. The total auto repair and maintenance services market is projected to reach $800B by 2026, with Shopmonkey's current penetration suggesting significant headroom for growth through both geographic expansion and deeper vertical integration.

Vertical software commoditization: The auto repair shop software market has become increasingly crowded with well-funded competitors like Autoleap, Tekmetric, and Shop-Ware all pursuing the same "all-in-one platform" vision. This commoditization pressure could force Shopmonkey to compete on price rather than features, potentially compressing margins. The company's current $5,100/year pricing for independent shops may become difficult to maintain as competitors offer similar core functionality at lower price points.

Electric vehicle transition: The shift toward EVs represents an existential threat to Shopmonkey's core market, as EVs require significantly less maintenance than traditional vehicles. While this transition will take years, it could materially shrink Shopmonkey's total addressable market as fewer repairs are needed and some independent shops struggle to adapt to EV servicing.

Payment processing dependency: Shopmonkey appears increasingly reliant on payment processing revenue, which could generate up to $18,000 annually per shop at a 2.5% take rate. This dependency makes them vulnerable to both payment processor competition and margin compression, especially as larger processors like Square expand their vertical-specific offerings. The company may struggle to maintain its current take rates as shops become more price-sensitive and payment processing becomes further commoditized.