Online payments processor Stripe’s IPO (initial public offering) is one of the most anticipated listings in the tech industry.
The company made its first steps to go public in 2021. And with a projected valuation of $50 billion as of (March 15, 2023), Stripe is on track to debut among the biggest IPOs in history.
But how does a retail investor go about investing in an IPO like Stripe, especially if they make a direct listing?
Find out more about what could be one of the hottest IPOs and how to buy Stripe stock on Public.com if it lists on the stock market.
What is Stripe?
Stripe is a payment processing firm and it’s considered one of the most valuable technology startups. Brothers Patrick and John Collison created the private company in 2010. It has headquarters in both Dublin, Ireland, and San Francisco, California.
Stripe has risen over the years to become what the New York Times called “the largest among a class of fast-growing, highly valued financial technology companies.”
Stripe’s core product is payment processing, and scores of e-commerce businesses use it—including the most recognizable names. From startups to Fortune 500 companies, some of Stripe’s customers include Zapier, Slack, Google, Instacart, Amazon, and Shopify. Businesses in over 120 countries use Stripe to help facilitate commerce and growth.
When Is the Stripe IPO Date?
Will Stripe go public this year? We don’t know yet. Stripe is expected to go public sometime soon, although no date has been set. The company filed its intentions to go public with the Securities and Exchange Commission (SEC) in July 2021.
Some say due to its massive valuation, Stripe doesn’t need the capital and could pursue a direct listing instead of a traditional IPO. A direct listing involves offering current investors the chance to sell shares without being bound by a lockup period. A traditional IPO on the other hand, is when a company going public works with investment banks to sell its shares on a stock exchange via institutional investors.
Retail investors interested in buying shares of Stripe, once it’s publicly traded, or other companies that list on the stock market can do so through most brokerage firms.
Public is working toward an IPO allocation offering. Our Public Live shows cover the latest IPOs so you can find out about any upcoming IPOs. And with Public Premium you can access advanced business metrics on public companies.
How Much is Stripe Worth?
Stripe lowered its valuation to $50 billion from $95 billion as of March 15th, 2023 when they raised $6.5 billion to provide liquidity to current and former employees amidst economic and political uncertainty
The company has had a number of fundraising rounds, with the most recent being in March 2023, when it raised $6.5 billion million from a number of companies including Andreessen Horowitz, Baillie Gifford, MSD Partners and Thrive Capital, among others. Here’s a full list:
Why Does Stripe’s IPO Stand Out?
Stripe’s IPO is one of the most anticipated listings in a while, mostly due to its high valuation The COVID-19 pandemic also fueled its growth, with many businesses turning to Stripe to fill their sudden need to build online payments capabilities.
The payment platform is designed for any company to be able to use and scale as needed. Within the payments processing, Stripe offers revenue management apps, fraud prevention, and a cloud-based infrastructure. It also offers BNPL (buy now, pay later) services.
Other business segments the company has been focusing on include additions of new programs such as Stripe Identity and Stripe Tax. Stripe has also been actively investing in other fintech startups and has taken on a few acquisitions of its own. It has invested in corporate card issuer Ramp and teen-focused payments and banking app Step. Other investments this year have been in Pico, Safepay, Accord, and Balance.
How to Invest in the Stripe IPO
If you want to invest in Stripe, you can do so when and if it goes public. Once it’s publicly listed, you can buy shares of Stripe during stock market open hours the same way you would buy shares of any other public company.
First, you should make sure you want to invest in Stripe by analyzing their financial history and reports that become available after a company goes public. With Public’s Premium offering, you can get access to advanced business metrics on many public companies and follow their financial performance, market cap and valuation, and growth metrics as the company progresses.
While its financial statements are currently private, once it goes public, Stripe will have to publish its financial statements every quarter. These statements will give insight into Stripe’s cash flow, financial position, and potential financial risks, such as pending lawsuits.
Once you’ve decided whether or not to invest in Stripe when it’s listed, you can buy stock through the Public.com app.
Public is working on an IPO allocation offering and members can join the waitlist to be notified about upcoming IPO allocations through the Public.
To buy shares of a company:
- Sign into the Public app or website and look up the company you want to buy stock in.
- Make sure you have funds in your account.
- Decide how much you want to buy and then place your order.
Strength and Opportunities of Stripe IPO
- Market remains largely untapped, with room for plenty of growth. The online payment industry is still booming, with many transactions switching to digital instead of paper even as life gets back to normal.
- History of strong leadership. Plus, it doesn’t only offer payment processing, but a host of other valuable services to diversify its product line. That trajectory is bound to continue.
- One of the most valued startups in the U.S. About 964,894 websites currently use Stripe, including many top brands like Slack, Xero, Deliveroo, Ford, and more.
Weaknesses and Risks of Stripe IPO
- Generates a large amount of business through Shopify, and the company’s dependence on it could be a problem.
- Stripe’s enormous valuation means the company would need to prove it can continue to grow post-IPO, as we’ve seen with other public companies. Its large valuation could actually deter some investors away, as it could fall when it debuts on the stock market. It was also recently devalued from $95 billion to $50 billion, which could give some investors pause.
- There is a lot of volatility with an IPO. Investing is risky, so if you want to invest in Stripe’s IPO, make sure to do your own research and seek out the investment advice of a professional before investing in the stock market.
Stripe holds a strong segment of the payments-processing market in spite of competition from the likes of PayPal, WePay, and Square. It has steadily grown to attain one of the largest valuations in the fintech space and across all company types.
Keep an eye out for what may be a large IPO, possibly in the near future and be sure to join Public if you want to be informed about new IPOs.
