Plaid Raised $425 Million After Visa Deal Falls Through
If you’ve used any number of financial apps over the past few years, there’s a strong chance that you’ve encountered the name Plaid. The firm’s API allows applications to securely connect to users’ banking accounts and retrieve read-only data, enabling aggregation tools among others. This technology has allowed Plaid to grow into one of the largest and most notable FinTechs — and has now garnered them an investment mega-round.
Today, Plaid announced that it had closed a $425 million funding round. The Series D was led by Altimeter Capital while new investors Silver Lake and Ribbit Capital joined existing investors Andreessen Horowitz, Index Ventures, Kleiner Perkins, New Enterprise Associates, Spark Capital, and Thrive Capital in participating. According to TechCrunch, the latest round valued the FinTech at $13.4 billion.
Interestingly, that new valuation is more than double the $5.3 billion that Visa was set to purchase Plaid for when that deal was first announced early last year. That acquisition was called off in January after the Justice Department filed suit to block the deal, alleging that the purchase would allow Visa to “eliminate a nascent competitive threat that would likely result in substantial savings and more innovative online debit services for merchants and consumers.” In terms of other funding rounds, Plaid’s $250 million Series C was closed in 2018 at a valuation of $2.7 billion. To date, the company has now raised a total of $734.3 million.
In a blog post announcing the investment, Plaid co-founder and CEO Zach Perret wrote, “Looking ahead, Plaid is focused on creating a single, integrated platform focused on helping innovators build digital financial products. Doing so requires scaling to meet the increased use of FinTech, expanding globally to meet international demand, and delivering an expanded set of platform products to our customers. This will include continued investment in APIs that help people connect a complete view of their finances, as well as tools and services to support enhanced privacy, personalization, decisioning, and automation.” He concluded, “We could not be more excited for the years to come. Onwards!”
It should come as no surprise that Plaid is once again seeking investments after their near-deal with Visa broke off. Nevertheless, the incredible growth the FinTech has seen since that proposed acquisition was first announced is something to be marveled at. On that note, this Series D also likely signals that Plaid won’t become an acquisition target again anytime soon — although never say never. Instead, expect the company to see more massive funding deals in the future and perhaps a major IPO down the road.