Stripe explores public listing

Monday 30 January 2023 11:52 CET | News

US-based payments company Stripe has reportedly hired Goldman Sachs and JP Morgan Chase to advise it on a potential public listing within the next 12 months.


Wall Street Journal reported that executives of the company set a goal of either taking the company public or enabling employees to sell shares in a private-market transaction within the above mentioned timeframe. As per information offered to the publication by people that are familiar with the matter, the two investment banks are set to advise Stripe on both options.

Stripe and what the public offering entails

A payments processor for internet companies of the likes of Shopify and Instacart, Stripe has preferred staying private and disclosing fewer details to outsiders regarding its performance. Due to this, throughout the years, a pent-up demand for investors was created, with them clamouring to own part of Stripe, but not having the chance to do so.

However, over the past year, rising interest rates, inflation, and fears of a recession contributed to an extensive selloff in tech stocks, predominantly those of recently public companies, and caused and increased number of startups to shelve their plans for going public. 

Stripe’s last fundraising from March 2021 valued the company at USD 95 billion. As per details provided in the announcement, more recently, the company approached investors of the likes of Berkshire Hathaway in regard to raising a minimum of USD 2 billion in fresh cash at a valuation of USD 55 billion to USD 60 billion. The funding would have been used to cover a large tax bill associated with some employee stock units, however no information on whether the talks are still active was provided.

US-based payments company Stripe has reportedly hired Goldman Sachs and JP Morgan to advise it on a potential public listing within the next 12 months.

As stated by the Wall Street Journal, a Stripe stock-market could help revive an initial public offering market that went dormant in 2022. According to Dealogic, as per information provided in the announcement, traditional IPOS in the US had an increase of USD 8.6 billion in 2022, a decrease from all other years throughout the past two decades.

However, it is believed that Stipe will most probably not conduct a traditional IPO. As it does not have a need for raising additional capital, the company is thought to most likely pursue a direct listing. In a direct listing, a company places existing shares on a public exchange and lets the market determine the price, and unlike a traditional IPO, it does not choose the shares’ price of who gets to buy them, and typically, it does not raise any money. Usually, those selling stock in a direct listing are either employees or other early investors.

Context of the public listing

Following the COVID-19 pandemic, the increase in ecommerce boosted Stripe’s business, with their 2020 annual revenue having grown approximately 70% to around USD 7.4 billion, whereas the March 2021 fundraising helped Stripe become one of the world’s most valuable statups.

However, consumers’ return to in-store shopping and the change in their spending patterns in the face of high inflation brought forth challenges. 

In July 2022, Stripe cut an internal share price used to price stock options given to employees to USD 29 from USD 40, which lowered the implied value of the company to USD 74 billion. As stated by the Journal, those shares were recently cut in value to USD 25, thus giving the company an implied valuation of USD 63 billion.

More: Link

Free Headlines in your E-mail

Every day we send out a free e-mail with the most important headlines of the last 24 hours.

Subscribe now

Keywords: payments , online payments, public listing, IPO, stock, payment processor
Categories: Payments & Commerce
Companies: Goldman Sachs, JP Morgan, Stripe
Countries: United States
This article is part of category

Payments & Commerce

Goldman Sachs


JP Morgan



Discover all the Company news on Goldman Sachs and other articles related to Goldman Sachs in The Paypers News, Reports, and insights on the payments and fintech industry:

Industry Events