#473
Stripey Matters
Published:
Jan 30, 2023
Author:
Sarah Parsons Wolter
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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!
Portfolio News
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Stripey Matters
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Select Financings
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