As IPOs and capital markets activity ground to a halt in 2022, unicorns and investors alike are peeking at the public markets for a resuscitation in 2023. This week, Stripe - the payment processing company powering internet giants like Shopify, Instacart and Amazon - announced this week that it would either go public or allow employees to sell stock within the year. The company has hired Goldman Sachs and JP Morgan to advise on the transaction, and had earlier estimated its own valuation to be ~$63b.
Stripe’s announcement was made at an internal meeting, largely to address an impending stock squeeze where some employee RSUs are set to expire without a liquidity event. Specifically, Stripe had previously issued RSUs that required the company go public in order for those stock units to vest. In addition, the company was reportedly in talks to raise additional capital partly to help cover a large tax bill associated with some employee stocks.
In this cycle of capital activity drying up and public market valuations compressing, many private tech companies are seeking methods of giving employees liquidity outside of a traditional IPO, whether through private secondary transactions or direct listings. In conjunction, they need to solve for a whole host of ancillary challenges, including taxation planning, cap table organization and share pricing.
Stripe has told its employees that it will make a decision on the IPO front within one year, and we’d expect other unicorns to follow in a similar vein. And to celebrate some potential liquidity, here’s a fun gif of some stripey animals to kick off your Saturday!
Centrifuge quietly sets pace in real world assets race - “Put it on the blockchain" is a phrase that almost became a joke to highlight the supposed uselessness of the distributed ledger technology. But Centrifuge, a project designed to put debt products on-chain, is making the cliche look serious - it has facilitated $252m in financing. With $112m in outstanding loans, the platform also leads all real-world asset (RWA) lending protocols, according to RWA, an outfit which focuses on the fast developing tokenization of assets which aren’t natively digital. Read more
Mondu's Dr Miyu Lee, Chief legal officer, highlights the pandemic's impact on general counsels - Some of the main changes the pandemic has brought into the world of work for in-house counsel and the function of the general counsel include: (I) the trend towards remote working. For many other employees, the pandemic has changed the working conditions of in-house lawyers and general counsel towards a higher degree of flexibility regarding working location. Read more
Stripe plans to go public in next year or make a deal to resolve employee stock squeeze - The potential maneuvers are aimed at resolving a lingering problem for Stripe: Some of its veteran employees hold restricted stock units due to expire soon, meaning a big piece of their compensation could evaporate without action from the company. Read more
Banks plan payment wallet to compete with PayPal, Apple Pay - Wells Fargo, Bank of America, JPMorgan Chase and four other banks are working on a new product that will allow shoppers to pay at merchants’ online checkout with a wallet that will be linked to their debit and credit cards. The digital wallet will be managed by Early Warning Services LLC, the bank-owned company that operates money-transfer service Zelle. The wallet, which doesn’t have a name yet, will operate separately from Zelle. Read more
Amazon to ‘significantly expand’ use of Stripe - Under the new agreement, Stripe will become a strategic payments partner for Amazon in the U.S., Europe and Canada, processing a significant portion of Amazon’s total payments volume. Stripe will be used across Amazon’s business units, including Prime, Audible, Kindle, Amazon Pay, Buy With Prime and more. Read more
California DMV puts car titles on Tezos blockchain, consumer applications on the way - The Department of Motor Vehicles has never been an agency that screams innovation. But this may be changing after a collaboration between California's DMV and open-source blockchain Tezos and Oxhead Alpha, a crypto-focused software development firm. Together, the three partners are building a DMV-run blockchain that will not only digitize car titles for California drivers, but also seek to streamline title transfers between owners. Read more
‘Scared the hell out of me’: NYSE’s wild start rattles traders - A chaotic open for some stocks listed on the New York Stock Exchange sent chills across Wall Street as dozens of the largest companies in the US seemed to erase billions of dollars in market value for no apparent reason, leaving some investors frustrated and others clamoring for an explanation. Trading was halted for dozens of big-cap stocks within the first 30 seconds of Tuesday’s session after they appeared to post wild swings that puzzled investors. Read more
We asked ChatGPT to make a market-beating ETF. Here’s what happened - In a bid to see how close technology really is to replacing Wall Street’s army of analysts, experts and money runners, we challenged ChatGPT, the artificial intelligence tool that’s taking the internet by storm, to create us a winning portfolio for the US stock market. The result: A classic exercise in fence-sitting, with the tool explaining that the market is too unpredictable to design such a fund, while warning about the need to pick investments aligning with our goals and appetite for risk-taking. Read more
Rich customers pull money from banks offering paltry interest rates - Big banks are still paying paltry interest on checking and savings accounts despite the Federal Reserve’s steepest rate increases in decades. Their wealth-management customers are done waiting: They are moving the extra savings they accumulated during the pandemic into products whose rates have more closely tracked the Fed. Read more
SEC scrutiny blocks some crypto firms from going public - The SEC didn’t set out to stop the companies from going public, according to a person familiar with the matter, but crypto firms believe the pace of the agency’s review hurt their efforts, particularly after the crash of a well-known cryptocurrency and the failure of a large crypto hedge fund that hit many exchanges and lenders. The bankruptcy of crypto exchange FTX and a bear market in digital asset prices may keep the door closed. Read more
Amazon NFT initiative coming soon - Amazon is launching a digital assets enterprise, according to four sources familiar with the matter, who said that an NFT initiative is expected in the spring. Amazon has been shopping the digital collectibles effort to no shortage of power players in the industry, with a focus on blockchain-based gaming and related NFT applications. Read more
Brazil and Argentina to start preparations for a common currency - The initial focus will be on how a new currency, which Brazil suggests calling the “sur” (south), could boost regional trade and reduce reliance on the US dollar, officials told the Financial Times. It would at first run in parallel with the Brazilian real and Argentine peso. Read more
Klarna introduces Spotify-style 'Money Story' overview - Klarna has taken a leaf out of Spotify's playbook with the launch of Money Story, a personal summary of 2022 that provides consumers with useful insights into their spending habits. Read more
Crypto banks borrow billions from home-loan banks to plug shortfalls - Signature Bank tapped its local home-loan bank for nearly $10b in the fourth quarter, among the largest such borrowings by any bank since early 2020, according to securities filings. Silvergate Capital, a competing lender that shifted its business toward crypto a decade ago, received at least $3.6b. Although helping banks shore up liquidity is part of the mission of FHLBs, some observers say backstopping the crypto industry’s fallout is far removed from the original intent. Read more
EU lawmakers back 'prohibitive' capital rules for crypto assets - European Union lawmakers backed a draft law on Tuesday to implement the final leg of post-financial global bank capital rules, adding "prohibitive" requirements to cover risks from cryptoassets. The European Parliament's economic affairs committee approved a draft law to implement Basel III capital rules from January 2025, though backing several temporary divergences to give banks more time to adapt. Read more
Accord - California based collaboration platform for B2B sales raised $10m in Series A funding led by Matrix Partners, Nat Friedman and YC. Read more
Calimero Network - London based blockchain infrastructure company raised $8.5m in Seed funding led by Khosla Ventures, Lyrik Ventures and Near Foundation. Read more
Coverdash - New York based insurance startup for SMBs and gig economy workers raised $2.5m in Seed funding led by Bling Capital. Read more
Dayforward - New York based life insurance startup raised $25m in growth funding led by AXA Ventures. Read more
Ethos Wallet - Reno based crypto wallet based on the Sui blockchain raised $4.2m in Seed funding co-led by Boldstart Ventures and Gumi Cryptos Capital. Read more
Foro - Charlotte based commercial lending startup raised $8m in Series A funding led by TTV Capital. Read more
Hawk AI - German based developer of anti-money laundering and fraud prevention tech raised $17m in Series B funding led by Sands Capital. Read more
Inscribe - San Francisco based fraud detection startup raised $25m in Series B funding led by Threshold Ventures. Read more
Kenzy - UK based rent-to-own startup for key workers raised £3m in Seed funding led by Axeleo Capital and Outward VC. Read more
Pilon - Singapore based supply chain financing fintech raised $5.2m in growth funding led by Wavemaker Partners. Read more
QuickNode - Miami based blockchain development platform raised $60m in Series B funding led by 10T Fund. Read more
Salv - Estonia based crime monitoring and compliance platform raised €4m in Seed extension funding led by ffVC. Read more
Sandbar - New York based anti-money laundering, fraud, and counter-terrorism risk detection software provider raised $4.8m in Seed funding led by Lachy Groom and Abstract Ventures. Read more
Spatial Labs - California based web3 infrastructure and hardware company raised $10m in Seed funding led by Blockchain Capital. Read more
Suppli - Texas based digital accounts receivable platform for the construction market raised $3.1m in Seed funding led by Equal Ventures. Read more
Vartana - San Francisco based sales platform raised $12m in Series A funding led by Mayfield. Read more
Wafeq - Dubai based accounting and financial compliance startup raised $3m in Seed funding led by Raed Ventures. Read more
Zenfi - Mexico based credit tracking and lending company raised $8.5m in growth funding led by Magma Partners. Read more
Zitti - Los Angeles based food supply chain management platform for restaurants that includes payments infrastructure raised $3.5m in Seed funding co-led by Oceans Ventures and Serena Ventures. Read more
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