Stripe hires investment banks to explore IPO

SAN FRANCISCO — Stripe, San Francisco’s payments provider and one of the world’s most valuable private start-ups, hired Goldman Sachs and JPMorgan Chase this week to advise it on a possible public listing next year, two people familiar with the subject told me.

If a listing moves forward, Stripe’s public debut would be among the largest and most anticipated in its startup category, potentially reopening moribund public markets to new offerings.

Stripe told employees on Thursday that it was considering multiple avenues for its shareholders to cash out over the next 12 months, the sources said. Possible routes include a direct listing, in which the company would publicly list its shares but not issue new ones; a takeover bid, in which it would sell employee shares to outside investors but would not be made public; or a regular initial public offering, the people said.

News previously reported on Stripe’s plans.

Investors have valued Stripe, which was founded in 2010 by brothers John and Patrick Collison, at $95 billion in 2021. Last year, amid market turmoil for tech start-ups, the company lowered its internal valuation by 28% to $74 billion and laid off 14% of staff, or just over 1,000 people.

The company, which sells payment processing software to companies including Peloton, Wayfair and Amazon, has pushed back on access to public markets. But its early investors, who are sitting on huge returns, and employees, some of whose shares will soon expire, are eager to enjoy the company’s success.

Stripe has raised over $2 billion from investors including Sequoia Capital, General Catalyst, Founders Fund, Thrive Capital and Andreessen Horowitz.

Market watchers often see Stripe’s performance as an indicator of the overall health of the startup market, as it started out serving other startups before expanding to larger customers.

Like many tech companies, Stripe has spent the last year retreating from overly optimistic growth plans in the face of a faltering economy. “We were far too optimistic about the near-term growth of the internet economy,” Patrick Collison wrote in a message to employees announcing layoffs in November.