Stripe announces new round of funding and plan to provide employee liquidity

Stripe missing the 2018-2021 tech IPO window is going to be seen as a historic business decision making failure. Everything was in their favor. They could have sleepwalked into a $120B+ market cap. All employees and investors could have had as much liquidity as they desired. But for whatever reason the founders stuck to their "we will stay private forever" stance, and the entire company is suffering because of it.

I think we should accept that this is a good move and leave it at that. I remember a thread a few weeks back where we were criticizing stripe about the incoming deadline and how stripe would end up screwing early employees. Now they made the correct move and the conversation switches to “they should have exited earlier?”. This is an impossible crowd to please. Everyone makes mistakes and mistakes at that scale will always have gigantic implications. They resolved it.

I&#x27;m a bit cynical when I see stuff like this. Is it a way for the company to exit employee shareholders and put that equity into investor hands? Especially at a discount from peak?<p>That can be good for employees (money in your bank is a good thing), but only if they want to sell.<p>Edit: there&#x27;s another thread with more info. This round looks to address a specific issue that would affect employees very negatively. So it seems like a good thing and not corp greed.

The company is 12 years old, the biggest player in their domain (online payments) and still needs that much funding? Where is it time to turn the knobs and start producing income?

Series I lol. I think the latest funding round I&#x27;ve seen prior to this is a Series G, but really anything past D&#x2F;E seems rare.

Tender offers can be pretty tricky for employees to navigate<p>Put together a quick guide all about taxes&#x2F;financial implications of participating in a tender offer: <a href="https:&#x2F;&#x2F;manual.withcompound.com&#x2F;chapters&#x2F;what-to-do-if-your-company-has-a-tender-offer">https:&#x2F;&#x2F;manual.withcompound.com&#x2F;chapters&#x2F;what-to-do-if-your-...</a>

A 50% drop is a big oof moment for Stripe. But then again I don&#x27;t think the company was every really worth +90b dollars.<p>If I were an employee I&#x27;d take the liquidity now before this goes the way of WeWork

48% discount from peak valuation (95 G$ in Mar 2021). Ouch.

&gt; Stripe benefits from the early role it plays in technology waves that reverberate across the industry, like mobile marketplaces, SaaS, and now AI, with users like OpenAI, Anthropic, Midjourney, Copy.ai, CoreWeave, and a long list of others.<p>So does Starbucks, by selling coffee to those companies&#x27; employees.

&gt; Stripe [] has signed agreements for a Series I fundraise of more than $6.5 billion (€6.15 billion) at a $50B (€47B) valuation. Primary investors include ...<p>&gt; The funds raised will be used to provide liquidity to current and former employees and address employee withholding tax obligations related to equity awards, resulting in the retirement of Stripe shares that will offset the issuance of new shares to Series I investors. Stripe does not need this capital to run its business.<p>As I read this, the plan is to issue a number of shares, buy exactly that many shares from Stripe employees, and retire the purchased shares.<p>Why do it that way instead of allowing the employees to sell their shares into the Series I offering?

If I was an employee of such company, I would just sell all my equity as soon as I got it. I suspect they have no clue how insanely lucky they are and how many forces have worked in their favor behind the scenes to put them in such fortunate position. After such insane winning streaks, it&#x27;s the less arrogant ones who understand their luck who get to keep the spoils.

So given Stripe’s record so far of never wanting to go public, what’s the incentive to buy into this funding round?

At this point, they might as well do a direct listing. Raising more money would just cut their valuation further and as soon as they list everyone can dump 20% of their holdings to provide liquidity.<p>But either way, they should have at least IPO&#x27;d in 2019, just like the rest of the companies out there who raced to the exit [0] [1] instead of a 50% valuation cut from $95BN.<p>[0] <a href="https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=20993919" rel="nofollow">https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=20993919</a><p>[1] <a href="https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=31062658" rel="nofollow">https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=31062658</a>

Even in the best case of startup outcomes it still seems like they find a way to screw you over unless you have preferred shares. Sure there are the few lotteries that hit, but overall it isn’t a great deal. I wonder if we will see more startups just start to offer all cash.

Does this imply that Stripe thinks an IPO in this market would value them lower than $50B?

They definitely missed the opportunity of a lifetime, the numbers must have looked unusually poor to have not made the decision to IPO in 2021.

So even the peak bubble boys with a real company are down 50%? That means every other private mark down is 80-90%+…<p>Now you see why they panicked over SVB.

Will any of the funding go towards improving the customer experience? HN has been a Stripe support hotline the past few months.

Stock options are so fucked. I&#x27;ll never go back to the startup world without actual compensation.

I&#x27;m not so sure about this, but can we really say that they&#x27;re just trying to hype their upcoming IPO a bit more? Who knows though. Also, I am thinking they might be on the right path to further delay their IPO because of the current market condition.

There were a lot of offers to buy into this last funding round, and I gotta be honest the price point was not appealing.

Ah, financial gravity comes to unicorns. 20x EBITDA starts looking reasonable, instead of the previous 40x.

overrated company with bad foresight to read the trend. Maybe paystack is a terrible acquisition anyways.

What prevented an IPO?

The same Stripe we read complains and Tell HN stories every month ...

well on its way to a $15bln valuation, just a matter of time

Raising money now means they probably expect the financial industry to go further down.

Plan to provide employee liquidity? Is this just a euphemism for &quot;paying them?&quot;

Eek, why don&#x27;t we fix AMT and stop treating employees so poorly? This whole scheme is utterly repellent to me and makes me feel incompetent to have to read and consume it. Why so many stratagems around something that is literally incompetent?

What&#x27;s with all this talk of &quot;employee liquids&quot; and where can I purchase them?<p>Are they made of real employees?<p>How are these liquids rendered? Some kind of masher, or industrial grinder perhaps?<p>How is it determined which employees are rendered into liquid and which ones are not? A merit-based review, or perhaps a lottery system?<p>What are the uses and health benefits of consuming employee liquid? What does it taste like?