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The latest funding rounds that Stripe has closed and the level of participation may suggest a more ambitious move for the payment processor.
Stripe, a San Francisco-based Irish-American financial services and payment firm has secured as much as $1 billion in new funding, to solidify its position as the most valuable company in the United States. According to a report by the Wall Street Journal citing people familiar with the transactions, the company recently offered investors the opportunity to purchase significant stakes from early investors as well as its current and past employees.
Per the report, bids from investors exceeded $4 billion, however, only $1 billion was filled. Amongst the investors who bet big on the company in this funding round including mutual funds firm, Capital Group Company, venture-capital firm Sequoia Capital, e-commerce company Shopify Inc and buyout firm Silver Lake. The majority of the bids remained unfilled as some current holders became hesitant amidst hopes that there is yet more life for the shares in the near future.
Stripe continues to trail the blaze after pulling in $600 million to hit a valuation of $95 billion back in March. This funding round positioned the company as the most valuable startup in the US. The company’s business has received a rejuvenation, boosted in part by the advent of the coronavirus pandemic. The global health upset made users and business enterprises push for contactless payment options, one of the key influences that have helped Stripe’s growth over the past year.
Stripe Funding Hinting at Public Listing Push
The latest funding rounds that Stripe has been closing and the level of participation may suggest a more ambitious move for the payment processor. While the company’s capital accumulation is primarily targeted at boosting its expansionary drives in the European Union, the firm may also be eyeing a potential public debut, what some consider as the next logical move for the outfit.
Inline to help brace the economy for further uncertainties and shield businesses from money strains, the Feds implemented a zero-interest economic policy, making traditional investments unattractive to investors across the board. While the details still remain largely sketchy, Stripe appears to be on track to go public later this year or early next year.
Taking a cue from the public debut of America’s largest cryptocurrency exchange, Coinbase Global Inc (NASDAQ: COIN), the early investors have a lot to benefit from when the company goes public, with appreciable Return on Investment on the line. While Stripe and its business fundamentals seem highly attractive, it also brandishes a promising expansion model that investors can bank on for growth. Besides its planned foray into Europe, the firm acquired the Nigerian payment processor, PayStack for $200 million, a move that will aid its exploration of emerging markets in Africa.