Major Stripe investor Sequoia confirms $70B valuation, offers its investors a payday

Sequoia Capital offers to buy up to $861M in Stripe shares, reflecting confidence amid a delayed IPO.

: Sequoia Capital aims to buy $861 million worth of Stripe shares for its limited partners due to a delayed IPO. Despite a drop in valuation from $95 billion to $70 billion, Sequoia remains optimistic about Stripe's prospects. Stripe's growing payment volume and cash flow positivity further bolster investor confidence.

Sequoia Capital has offered to purchase up to $861 million in Stripe shares for LPs in funds raised between 2009 and 2011, reflecting both a desire for liquidity in a dry IPO market and confidence in Stripe’s future. This move comes as Stripe continues to delay its IPO plans, having been valued at $95 billion in 2021 and having recently settled at a $70 billion valuation after a tender offer to provide liquidity to its stakeholders.

Sequoia’s commitment, which values its entire position in Stripe at $9.8 billion, demonstrates its ongoing belief in Stripe’s potential despite the reduced valuation. The firm has invested $517 million in Stripe since 2011, and distributed $10 billion to investors in 2023, indicating healthy returns amid challenging market conditions for IPOs. Stripe maintains its status as a leading startup with a substantial valuation despite not going public yet.

Stripe has shown robust growth, reporting a payment volume exceeding $1 trillion in 2023 and being cash flow positive last year. These factors suggest that Stripe may not feel pressured to raise capital imminently, allowing it to focus on smoothing the path for employee and investor share sales through private transactions. Partner involvement from Sequoia on Stripe’s board offers crucial insights into Stripe’s financial maneuvers, showcasing the strategic cooperation between the two entities.

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