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Stripe cuts internal valuation by 28%

wsj.com

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Re: Stripe cuts internal valuation by 28%

#31

Post by bottled_poe »

borski wrote: post #27
dasil003 wrote: post #11

Earlier quoted context omitted.

It only makes the options less valuable if they are actually offering a liquidity event, otherwise it is actually advantageous to employees as any new option grants (both new hire and refreshers) are delineated in dollars, so a lower valuation means they get more of them. I get that this might not align with the perspective of their employees, especially if they skew young and their expectations were shaped by tech s…

For any employees that have already exercised their options, that also means the value of what they thought they were getting just went down.

Yes, but that a risk they accepted.

Re: Stripe cuts internal valuation by 28%

#32

Post by gkapur »

asd88 wrote: post #4

$74B is still quite high for the current market

I don't know if I agree. Adyen is worth $45 billion euros (so $45 billion :) .) From their last annual reports, Adyen '21 GPV: $561B +70% YoY; Stripe '21 GPV: $640B +60% YoY but Stripe has ~2x take rate on Adyen because they are more PLG versus Adyen has many more enterprise customers.

So $74b is probably about right or maybe even low?

Re: Stripe cuts internal valuation by 28%

#33

Post by kortilla »

bottled_poe wrote: post #31
borski wrote: post #27

Earlier quoted context omitted.

For any employees that have already exercised their options, that also means the value of what they thought they were getting just went down.

Yes, but that a risk they accepted.

Nobody said otherwise. Doesn’t make make it anymore attractive though.

Re: Stripe cuts internal valuation by 28%

#35

Post by thundergolfer »

Remember that Stripe changed its RSU grant structure a year or so ago, so this won’t negatively affect newer employees. Stripe gives out a fixed amount of $$ value of stock each year now. The typical recent senior hire will get around $200k a year in stock. Now that the valuation is lower, they’ll be granted more stock units than before, which is good. Getting granted fewer stock units at a ‘fake’ higher valuation would have been frustrating.

1. https://blog.pragmaticengineer.com/equity-for-software-engin... (Ctrl-F Stripe)

Re: Stripe cuts internal valuation by 28%

#36

Post by TheCoelacanth »

borski wrote: post #27
dasil003 wrote: post #11

Earlier quoted context omitted.

It only makes the options less valuable if they are actually offering a liquidity event, otherwise it is actually advantageous to employees as any new option grants (both new hire and refreshers) are delineated in dollars, so a lower valuation means they get more of them. I get that this might not align with the perspective of their employees, especially if they skew young and their expectations were shaped by tech s…

For any employees that have already exercised their options, that also means the value of what they thought they were getting just went down.

The imaginary value went down, unless they are actually offering liquidity for employees who have exercised.

Re: Stripe cuts internal valuation by 28%

#37

Post by majormajor »

toomuchtodo wrote: post #5
asd88 wrote: post #4

$74B is still quite high for the current market

The current market so far . Interest rates will rise and CC transactions will migrate over time to less costly rails starting in the next 12-18 months (although Radar, Identity, and other value add products are likely to see continued use and rev growth). Imho, Stripe should've IPO'd at the top ~12+_ months ago. EDIT: @pbriet (HN throttling, can't reply directly to your comment) In the US, Zelle does $490B worth of v…

Credit cards, compared to Zelle or even higher-dollar direct-transfer things, have a pretty big moat:

* for people who don't have the money up front, it covers "spending money that isn't in their account today" (for better or for worse). BNPL seems like worth paying attention to from this front, though.

* for people who do have the money up front, why move to something with more of an immediate hit to my bank account in case of fraud? For large stuff (car downpayments or above), the fee was already significant and a reason not to use them, but unless BestBuy is going to drop support for CCs, why would I move off?

Is high-dollar consumer goods what you expect to move away from CCs? Will US consumers let them?

Re: Stripe cuts internal valuation by 28%

#38

Post by borski »

bottled_poe wrote: post #31
borski wrote: post #27

Earlier quoted context omitted.

For any employees that have already exercised their options, that also means the value of what they thought they were getting just went down.

Yes, but that a risk they accepted.

Sure, but it's still compensation that is now less attractive. I never called it a moral failing.

Re: Stripe cuts internal valuation by 28%

#39

Post by borski »

TheCoelacanth wrote: post #36
borski wrote: post #27

Earlier quoted context omitted.

For any employees that have already exercised their options, that also means the value of what they thought they were getting just went down.

The imaginary value went down, unless they are actually offering liquidity for employees who have exercised.

Secondary markets exist for Stripe stock.

Re: Stripe cuts internal valuation by 28%

#40

Post by aetherson »

daniel-cussen wrote: post #23
digitalboss wrote: post #18

Journalists don’t really grasp that nuance. ‘Lower Valuation for Popular Company’ is always a good way to get eyeballs.

Sure did grab my eyeball, down round for a company that effectively was invincible--and I met the guy, I met pc (his username here)--but full on unblemished trajectory, totally monotonic. Never heard one bad thing about him, except in my inner monologue like biting the Fruit of the Tree of the Knowledge of Good and Evil, which I do for everyone, and just barely bad, not morally bad, just unfavorable for me in particu…

It's not a down round, which implies that they raised money at this valuation. It's a 409a valuation.
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