- Stripe was valued at $95 billion after it raised $600 million last March.
- It’s one of the highest-valued private companies in history, but public peers have slumped.
- Investor Fidelity’s valuation of the company has fallen by nearly a tenth in just two months.
Fidelity, an investor in privately-held payments processing giant Stripe, has marked down the value of its holdings in the company by 9 percent, a year after the fintech startup was valued at $95 billion, according to recent filings.
Fidelity’s decision to adjust the value of its investment comes following a tech-selloff in the markets, especially amongst public payments companies such as PayPal, Block, and Affirm. The move also follows a cool-off in valuations of late-stage startups, as technology investors are starting to feeling the effects of the market’s
volatility
.
Fidelity’s Growth Company Fund — a $55 billion fund that invested in Stripe’s Series H funding round — valued the company’s stock at $40.12 per share at the end of November. In the fund’s most recent filing from the end of January, Fidelity valued Stripe at $36.25 a share.
Fidelity declined to comment on the reason for its markdown, but public companies in the online payments and fintech sectors have seen their share prices plummet in the past six months, amid market uncertainty in the
technology sector
. PayPal’s share price dropped 60 percent since September of 2021 to $105.38 per share, netting PayPal a
market cap
of $117 billion. Square, the online payments company founded by Jack Dorsey, has seen its stock fall 54 percent over the past six months, and fintech company Affirm’s stock has tanked by 71 percent over the past six months.
Founded by Irish brothers John and Patrick Collison in 2010, Stripe initially positioned itself as an easier, less complex way for businesses to accept online payments compared to PayPal. Over the past decade, the startup has expanded into lending, international payments, fraud monitoring, corporate cards, and its customers include tech giants like Amazon. The fintech company also launched its own venture arm. By 2019, Stripe was reportedly processing billions of dollars in payments for millions of online businesses. In 2020, Stripe’s revenue was up 70%, to about $7.4 billion, according to a Wall Street Journal report.
The company’s meteoric growth has drawn the attention of hungry investors. In 2021, Stripe raised $600 million at a $95 billion valuation, making it at the time one of the most valuable private companies in Silicon Valley history.
According to recent data from CrunchBase, Stripe is now the fourth most valuable privately held company, behind ByteDance, Ant Group, and SpaceX. Bloomberg reported last year that Stripe was exploring a 2022 IPO or direct listing, and that some investors were able to sell shares on secondary markets which valued the company at $152 billion.
Because late-stage startups are private, there’s very little insight into issues like a wavering valuation. Reports from mutual funds are one way to gauge the views of at least some investors, although they do not represent other investors’ views, or the startup’s valuation as a whole.
Stripe isn’t the only privately-held company whose valuation was marked down by Fidelity. The fund slashed its investment in food delivery company Instacart by 18 percent, first reported by The Information. Instacart was most recently valued at $39 billion.
Stripe did not immediately respond to requests for comment.
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