Payment processing platform Stripe has been valued at $70 billion, according to media reports. Over the past few years, Stripe’s valuation has fluctuated significantly.
On July 15, according to Bloomberg, citing unnamed sources, Sequoia Capital was buying shares of Stripe investors looking to cash out. The venture capital firm is acquiring Stripe stock for $27.51 per share and will purchase up to $861 million worth of stock.
Stripe is one of the most valuable privately held technology companies. The company, founded in 2010, was founded later than Paypal but has grown rapidly in recent years to become a strong competitor to Paypal.
Sequoia Capital was not only one of the early investors in Stripe, but also participated in almost every round of financing afterward. Sequoia partner Michael Moritz is also a member of Stripe’s board of directors.
While it’s unclear what percentage of Stripe’s stake Sequoia owns, the prominent venture capital firm has participated in nearly every round of Stripe’s funding since.
The report said the company was valued at $65 billion after a deal that allowed current and former employees to cash out some of their shares. Last March, the company’s market capitalization was $50 billion, although that figure is lower than the $95 billion that Stripe will achieve in 2021.
Stripe, which was founded by brothers Patrick Collison and John Collison, said last month that it would begin allowing employees to sell their shares. John Collison noted that the company is in no hurry to make an initial public offering (IPO).
Despite analysts closely watching Stripe and other established fintech companies, waiting to see when and how they will go public, John Collison says that many companies go public too early, and Stripe is still focused on developing products and opportunities to grow its business.
Stripe reported in March that its total payment volume will exceed $1 trillion by 2023, a 25 percent increase from the previous year, and that businesses operating on Stripe account for about 1 percent of global gross domestic product.
Stripe currently operates in 43 countries, with a presence in 31 European nations. The company’s European operations play a pivotal role in its recent development, leading to the establishment of its second headquarters in Dublin, Ireland and a significant investment of this funding round in Europe. In addition to the European and American markets, many of the continent’s largest and fastest-growing companies work with this platform.
Stripe’s rise is inextricably linked to e-commerce, cross-border e-commerce payment has become one of the roadblocks for a considerable number of small and medium-sized sellers to set up an independent e-commerce site. Stripe provides payment processing software and product integration for e-commerce websites and mobile applications. 2020 will be a year of rapid growth for Stripe. The global outbreak of COVID-19 has forced many companies to centralize their operations online.
And Stripe is dedicated to creating an infrastructure for the Internet economy where all companies can use Stripe to collect payments and manage their online business. Online consumers have the option to make payments for their purchases using credit cards, such as Mastercard, VISA, American Express, etc., or through Alipay and WeChat, which are widely used by Chinese users.
Stripe takes a commission from each transaction, charging “2.9% + $0.3” for each successful transaction. Stripe partners with millions of companies, including the largest U.S. e-commerce company Amazon, Google, Microsoft and other largest Internet companies.
Since its inception, Stripe has undergone multiple rounds of fundraising, and its valuation has also been fluctuating. Writing here, the author has a question: The exceptionally volatile swings in venture capital investment in the fintech industry have left a mystery: What are these startups worth today?