Thrive Capital reportedly leads potential investment in Stripe

Thrive Capital, the investment firm founded by Joshua Kushner, is leading a potential investment in payments provider Stripe at a valuation of $55 billion to $60 billion, down sharply from two years ago, two people have said. knowing the subject.

Stripe is aiming to raise around $2.5 billion, one of the people said. Thrive has committed $1 billion, said another person familiar with the situation, who requested anonymity because the talks are confidential.

If completed, the funding could give Stripe breathing room in a tough market for public listings. The money should be used to pay the start-up’s tax debts and allow its employees to sell their shares. Many private tech companies are using stock options to help recruit employees, but a shaky market for public offerings has made it difficult for employees to cash in on those shares. Some Stripe employees have stock awards that will begin to expire next year if the company does not go public or raise new funds, a person familiar with the matter said.

The Wall Street Journal previously reported that Stripe had considered raising new funds.

Stripe’s moves are being scrutinized as it was once America’s most valued private company. How he reacts to an inhospitable public offering market could be a harbinger of how others are handling it.

The company, which brothers John and Patrick Collison founded in 2010, has hired Goldman Sachs and JPMorgan Chase to advise it on a potential stock market listing next year. It told employees last week that it was considering multiple avenues to allow its shareholders to cash out within 12 months.

Among the options is listing Stripe stock on the public market. Another is a takeover bid, in which the company would sell employee shares to other investors while remaining private. The new funding doesn’t mean a public listing isn’t being considered, one of the people with knowledge of the matter said.

A valuation of $55 billion to $60 billion would be a steep drop for a company that last raised funds at a valuation of around $95 billion in 2021. Stripe sells payment processing software to companies such as as Peloton, Wayfair and Amazon.

Over the past year, the funding environment for start-ups has deteriorated amid rising interest rates and a renewed focus on profits. Some tech companies have had a harder time attracting new investment, and many start-ups have had to cut costs.

For Thrive, known for its investments in startups like Skims, Warby Parker and SpaceX, a $1 billion bet is a big check. Mr. Kushner tried to bring the company out of the shadow of his older brother, Jared, who was a top adviser to his father-in-law, former President Donald J. Trump.

Thrive closed a $3 billion fund last year, its largest ever. Last week, he announced that he had sold a minority stake in the company to executives including Robert Iger, chief executive of Disney, and Henry Kravis, co-founder of private equity firm KKR. The deal valued Thrive at $5.3 billion. It is also in talks to invest in artificial intelligence company OpenAI.

Erin Griffith contributed report.