FinTech News
Sequoia Reportedly Offers to Buy Stripe Shares from Investors
Major FinTech investor Sequoia Capital is reportedly offering to buy stakes of Stripe from previous investors.
What’s happening:
According to a report from Axios, Sequoia has been emailing limited partners that invested in Stripe between 2009 and 2012. The venture capital firm is offering to purchase up to $861 million in shares of the FinTech giant. Notably, the share price offer of $27.51 per share values Stripe at $70 billion. While that’s lower than the $95 million valuation received in 2021, it is up significantly from the $50 billion value the company raised funds at last year. Those who received Sequoia’s offer have until August 14th to decide whether or not to sell.
Sequoia Capital first invested in Stripe in 2010 and has since put a total of $517 million into the company. The firm reports that its entire position is currently valued at $9.8 billion.
About Stripe:
Stripe is a platform that offers solutions for online and in-person payments. Since its launch, the service has become ubiquitous and has formed partnerships with the likes of Amazon, Shopify, and many others. In 2023, the firm processed more than $1 trillion in payments — marking a 25% increase from the year prior.
What they’re saying:
In the email to investors (published by Axios), Sequoia stated, “As a business, Stripe is unusual in three respects. First. it is durable across economic cycles, a fact which we have seen directly. Second, while many products increase efficiencies or save costs, Stripe is one of the few that delivers direct revenue acceleration for its customers… Third, Stripe is useful both to the world’s smallest companies and to the very largest (including Hertz, Alaska Airlines, and Amazon), yielding a compelling market opportunity.” The firm continued, “We are enthusiastic about the company’s ten-year prospects and Stripe’s mission to increase the GDP of the Internet.”
My thoughts:
Given Stripe’s long-held prominence, some may be surprised that the company has yet to go public. Well, that’s exactly why Sequoia is now offering investors the chance to capture some liquidity. As for whether or not they should take the firm up on the offer is hard to say — but who doesn’t love having options?
Meanwhile, it’s encouraging to see Stripe’s valuation rebounding after being slashed last year. This is not only good news for the company itself but also for the FinTech sector at large, which has experienced some rough years after reaching record funding highs in 2021. Clearly Sequoia still has faith in Stripe continuing to grow… so here’s hoping the same is true for others in the financial technologies space.
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