What's going on?
If you don’t know Stripe – the tech company that handles Facebook and Amazon’s online payments – you will now: late last week, it became the third most valuable startup in the US. Go get ‘em, tiger.
What does this mean?
Stripe raised $100 million back in January, but it’s already hungry for more: it raised another $250 million from venture capital investors last week, giving it a valuation of $35 billion – a 55% increase on its last one. It’s now only outpaced by government-unfriendly vape-maker Juul and WeWork parent The We Company. Then again, the latter’s valuation wasn’t exactly one public investors agreed with…
It remains to be seen if Stripe can avoid the same snub: you’ll have to wait and see if it has an initial public offering (IPO) of its own (the startup’s current success is reserved for big-bucks private investors, sorry to say). But have your payment details ready: given Stripe’s explosive growth, that IPO might not be far away.
Why should I care?
For markets: One in, one out.
While uninterested investors forced WeWork to shelve its IPO last week, they’ll soon have their “PropTech” fix. Homeshare service Airbnb announced it’ll be checking in to the stock market in 2020. Airbnb could prove popular with the market: it doesn’t rely on its own real estate, and tech investors love an asset-light middleman. Seems everyone’s waking up to the power of community…
Zooming out: Aim higher, Cisco.
Investors didn’t shy away from all IPOs last week. On Thursday, cloud analytics platform Datadog – having previously rejected a $7 billion takeover offer from Cisco – IPO’d to much fanfare: its shares soared 39%. That’s great for the big investors who bought in just before trading started, but not so great for the company itself, which could’ve sold its shares for more cash. Perhaps it should have opted for a newly in-vogue direct listing, where companies join the market without setting a price, pocketing whatever investors think best.