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Stripe cuts internal valuation by 28%

wsj.com

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Re: Stripe cuts internal valuation by 28%

#101

Post by projectazorian »

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.

If the other posts are to be believed they don’t have options, they have RSU’s. Not the same thing. Still not great of course but it’s better in the long run if leadership levels with people.

Re: Stripe cuts internal valuation by 28%

#102

Post by OgAstorga »

radicaldreamer wrote: post #97
ruraljuror wrote: post #72

Earlier quoted context omitted.

This is why many Stripes on blind are not angry. They will get more shares next year.

They should still be angry because this company should’ve gone public and made them liquid a year ago.

Shouldn't going public on an unrealistic market cap would cause more issues than benefits? Sure, a healthy exit is ok but later pressure to recover the market cap in the short term can cause heavy structural damages inside any org.

Re: Stripe cuts internal valuation by 28%

#104

Post by rco8786 »

ProAm wrote: post #60
rco8786 wrote: post #29

Earlier quoted context omitted.

They’ve hired 1000s of people with promises of an IPO and currently worthless RSUs. They would need to address that with a change in pay structure and likely some large bonuses up front. But otherwise agree with your reasoning.

TBF all those people who took those promises also knew they might never come to realization. In which case, small exodus and you replace them with people FTE's within a reasonable salary range. Happens all the time.

Yea absolutely. But they’re gonna leave for places that are actually paying stock. Stripe has to do something just for retention purposes.

Re: Stripe cuts internal valuation by 28%

#105

Post by rco8786 »

ericd wrote: post #73
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.

Please feel free to send any worthless Stripe RSUs my way. I've been looking for a way to pay someone for some of them for the better part of a decade at this point.

Tbh this seems like an odd investment choice given the context of this thread. You know that stock price is tied to their valuation right?

Re: Stripe cuts internal valuation by 28%

#107

Post by zlast »

gonehome wrote: post #98
Brystephor wrote: post #70

Earlier quoted context omitted.

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…

It's designed to screw employees out of upside and they sell it pretending it's employee favorable. If you reprice equity comp each year then you lose most of the upside. Compare the two following equity plans: Example Year 1: --- PLAN 1 FMV: $1 Strike: $1 Total #: 40k ISOs Vesting: 4yrs --- PLAN 2 FMV: $1 Strike: $1 Total #: 10k ISOs Vesting: 1yr --- In the second plan you get granted new equity per year targeting s…

In the case of a crash, "typical" companies do not re-grant equity. Look at your typical big tech company, did they regrant equity? All of tech is down -- few tech companies have granted additional equity.

Re: Stripe cuts internal valuation by 28%

#108

Post by rco8786 »

bagacrap wrote: post #48
rco8786 wrote: post #22

Earlier quoted context omitted.

So is Square’s growth. When the entire sector you’re in takes a 50%+ dive you have to be pretty naive to think your own valuation shouldn’t do the same.

XLK is down 26% from its high.

Fintech, in particular, is down significantly more. $FINX

Re: Stripe cuts internal valuation by 28%

#109

Post by rco8786 »

mupuff1234 wrote: post #46
rco8786 wrote: post #24

Earlier quoted context omitted.

I don’t envy Stripe’s position. I said as much on Twitter a few weeks ago. They put off IPO (for some reason), carried a huge internal private valuation, and have 1000s of employees sitting on paper RSUs waiting that IPO. Now it’s going to be either impossible to do or, if they force it, will be at a significant reduction of their private valuation.

If they believe in their valuation why shouldn't they just IPO? Is it really gonna matter if they IPO at 100B or just 60b? And if they are in fact a 100B company then supposedly at some point the public market should price them "correctly".

> Is it really gonna matter if they IPO at 100B or just 60b?

Let’s ask all the employees who have been told they have $1mm in stock only to find out they in fact have $600k, etc.

Re: Stripe cuts internal valuation by 28%

#110

Post by hibikir »

paxys wrote: post #6

Should be cut by 50%+ to be in line with the rest of the tech market, and even more if you are valuing it as a FinTech company. SQ is down 75% since its November peak.

Having no knowledge of their financials between then and now, we either expect that the valuation is done wrong, or that really, their growth and fees last year are really that much better than Square's and PayPal, in relative terms.

For someone that has access to all the numbers, like whichever accountants they brought in to do this FMV calculation, it's not as if comparing the companies would be that difficult. So my personal guess is that yes, Stripe must have had an extremely good year. Seems more likely to me than trying to be sketchy at a time when it's not really all that helpful for them.

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