Stripe Valued at $50 Billion Following New Funding Round

EMEA Daily, EMEA news, Stripe, Irish Life

Stripe has raised $6.5 billion in a funding round that values the payments firm at $50 billion.

The valuation, announced by the privately-owned company Wednesday (Mar. 15), is down from the $95 billion valuation Stripe reached in 2021, the latest indication of a difficult funding environment for startups.

“The funds raised will be used to provide liquidity to current and former employees and address employee withholding tax obligations related to equity awards, resulting in the retirement of Stripe shares that will offset the issuance of new shares to Series I investors,” the company said. “Stripe does not need this capital to run its business.”

The news follows reports earlier this month that the company’s funding round was being driven by a $3.5 billion tax bill.

Last month, PYMNTS wrote that Stripe had cut its internal valuation three times since 2022. This lower price is different from the valuation decided by investors.

Stripe, which processes eCommerce payments, saw its fortune rise when the COVID pandemic kicked off an online shopping boom. It said earlier this year it expects to process $1 trillion in payment volume for 2023.

However, as PYMNTS has noted, some investors have questioned the sustainability of high valuations for tech firms due to rising inflation shaking up the American bond market.

Also on Wednesday, Stripe announced a partnership with ChatGPT creator OpenAI, which plans to use Stripe’s financial infrastructure to monetize its ChatGPT and DALL-E AI products. Stripe, meanwhile, will incorporate OpenAI’s technology into its products and services.

“There’s two sides to this partnership, and we’re really excited about both of them,” Emily Glassberg Sands, Stripe’s head of information and data science, told PYMNTS CEO Karen Webster in an interview published Thursday (Mar. 16).

“We’re powering [OpenAI’s] monetization strategy, and [OpenAI is helping] Stripe evolve from our first act as a pure-payments focus to becoming a financial one-stop-shop [for the digital economy],” Sands said.

Using Stripe’s products, OpenAI was able create a global payments system for multiple product lines, in record time, she added.

“Our thesis is, we want to make it really easy for companies to spin up new monetization strategies in a way that is simple for them and their developers,” Sands said.

Sands said that three-quarters of the 500 leading generative AI companies have signed on with Stripe as they build solutions that no one thought “AI could do five, 10 years ago.”