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Stripe cuts internal valuation by 28%

wsj.com

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Re: Stripe cuts internal valuation by 28%

#61

Post by ushakov »

beebmam wrote: post #59
thundergolfer wrote: post #35

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 wo…

Frankly, I'd be fucking pissed off about this if I had options.

i'd imagine all the already executed options are now worth 28% less on paper, correct?

Re: Stripe cuts internal valuation by 28%

#62

Post by majormajor »

toomuchtodo wrote: post #42
majormajor wrote: post #37

Earlier quoted context omitted.

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…

I suppose we will need to see what happens when someone like Walmart or Amazon decides to prioritize instant payments over CCs in their checkout flows. The cost savings to them from avoiding merchant fees at their volume makes it inevitable they’ll test it. I can’t say if they’d start to pass along CC merchant fees, but I’m interested to find out. They can even offer BNPL or credit directly to their customers without…

Gas stations do this widely in my area, I wonder what their take rate on debit vs credit is. I've never seen data on that, unfortunately.

Amazon/Target/Walmart etc are in an interesting situation re: who would blink first on implementing surcharges. They haven't yet in 5 years, but of course that doesn't mean they never will. Walmart is the one that would seem most likely in terms of targeting value-first customers, Amazon in terms of technical flexibility (e.g. you can already link your checking account if you want), but a lot of the other ones desire those sorts of more financially-sophisticated customers.

Re: Stripe cuts internal valuation by 28%

#63

Post by rzazueta »

0xEFF wrote: post #52
wmf wrote: post #47

Earlier quoted context omitted.

You'll be able to sell it eventually.

Maybe, maybe not. If so, maybe for a profit, maybe for a loss.

Not a loss, per se, but if you were told you were receiving $200k in compensation as RSUs, and they drop in value to $50k, you could argue that's a $150k loss. It's absolutely a loss when you factor that in as compensation for the effort and labor your produced for them rather than co-onwership of the company, which RSUs decidedly do not represent.

Re: Stripe cuts internal valuation by 28%

#65

Post by nazka »

lostlogin wrote: post #57
0xEFF wrote: post #52

Earlier quoted context omitted.

Maybe, maybe not. If so, maybe for a profit, maybe for a loss.

How would you sell it for a loss?

I think he means sold for less than what it was on paper at the beginning. Like you start to work there and it’s valued at 200k but then time passes and now it’s at 30k.

Re: Stripe cuts internal valuation by 28%

#66

Post by Calavar »

lostlogin wrote: post #57
0xEFF wrote: post #52

Earlier quoted context omitted.

Maybe, maybe not. If so, maybe for a profit, maybe for a loss.

How would you sell it for a loss?

If you are accepting stock or stock options as compensation, that's generally coming in lieu of cash. Maybe you had an offer somewhere else with $30k more in salary, but you took this offer instead because the projected value of the stock made the total compensation higher. If you sell your stock after 4 years for $50k, you have taken a $70k loss relative to the other offer.

Re: Stripe cuts internal valuation by 28%

#67

Post by [deleted] »

OmarIsmail wrote: post #51
mulmen wrote: post #49

Earlier quoted context omitted.

Because they can't be sold right now. And the future date at which they could be sold is undetermined and doesn't appear to be any time soon.

What does that have to do with the valuation getting lowered? If a person had 1000 RSUs that were on paper worth 40k, now they are worth 30k. Either way they can’t be sold right now. And I don’t understand how 30k is “worthless”

[deleted]

Re: Stripe cuts internal valuation by 28%

#69

Post by danielmarkbruce »

pbreit wrote: post #14
toomuchtodo wrote: post #5

Earlier quoted context omitted.

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…

"CC transactions will migrate over time to less costly rails starting in the next 12-18 months" People have been saying that for decades. And in fact the opposite is happening. Visa/MC raising rates. PayPal raising rates. Volume shifting to more expensive BNPL.

FedNow hasn't been available for decades. It's a real threat to the entire cc ecosystem.

Re: Stripe cuts internal valuation by 28%

#70

Post by Brystephor »

beebmam wrote: post #59
thundergolfer wrote: post #35

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 wo…

Frankly, I'd be fucking pissed off about this if I had options.

I'm genuinely curious why you say this. Could you please elaborate? I've only worked at publicly traded companies.

I don't understand how this wouldn't be the exact situation you'd want to be in. my understanding is this:

1. If you're granted options at price X, and the new share price is lower than X, you're under no obligation to exercise your options. So no real financial loss or cost to you.

2. If you're granted options at price X, and the new share price is higher than X, you're still under no obligation to exercise your options. So it's up to you now.

3. You've exercised options at price X and now it's less than that. Well that sucks. No significant different from publicly traded shares being bought and suffering a price drop. Granted, it's easier to sell your public shares at a loss for reducing tax liability on other capital gains.

4. If you exercised options at price X and it went up then yay, you're winning.

5. If you are ensured to have been given $X worth of options, and your options have dropped to $Y, and now you'll be granted options to cover the difference of $X and $Y, these latest options will be granted at a lower price, $Z, and therefore will be better priced overall. Which would mean you could now exercise the options granted at the higher price or the ones granted at the lower price. Doesn't seem like it really matters or affects anything since the net gain is the same for the year.

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