Patrick & John Collison/Stripe.
Stripe cuts internal valuation to $63bn
The 11 per cent internal valuation cut marks the third for Stripe in the last six months.
Stripe has cut the internal value of its shares by around 11 per cent for an implied valuation of $63bn, according to sources familiar with the matter.
The cut, as first reported by The Information, marks at least the third time since June that the digital payments firm has made an internal valuation cut, following a 28 per cent cut last July and a smaller cut again in October.
As with the July cut, the valuation change was triggered by a new 409A price change – valuations set by third parties – rather than a new funding round.
This latest cut continues to widen the gap between Stripe’s internal and external valuations.
Now the San Francisco-based startup has seen its internal valuation reduced by 40 per cent in the last six months, alongside staff cuts of 14 per cent.
“We were much too optimistic about the internet economy’s near-term growth in 2022 and 2023 and underestimated both the likelihood and impact of a broader slowdown,” CEO Patrick Collison wrote in a memo addressing the November layoffs.
Stripe is not the only fintech to be hit with valuation cuts off the back of a record 2021 year for fundraising or to experience large scale layoffs in 2022.
With Stripe’s news and Coinbase’s layoffs just this week, it looks like these job and valuation cuts alike weren’t left at the door as we entered 2023.
Striped declined to comment.