'Stablecoin Summer': Stripe Makes Tender Offer at $159 Billion Valuation

In brief

• Stripe made a tender offer to buy shares from current and former employees with a company valuation of $159 billion.
• The firm saw a 34% yearly increase in business volumes and its stablecoin orchestration acquisition, Bridge, had volumes jump 4x.
• Its stablecoin focus also includes Tempo, a payments-focused blockchain that it anticipates will launch a mainnet soon.

Payments giant Stripe is offering to repurchase shares from current and former employees through a tender offer that values the firm at $159 billion. It comes amid surging stablecoin volumes and $1.9 trillion in business volume generated via its platform, the firm announced on Tuesday.  The tender offer is primarily being funded by the firm’s investors, like a16z and Thrive Capital, though it will use some of its own funds to buy back shares.  The valuation puts the firm in the range of consumer products giant Unilever (UL) and pharmaceuticals firm Pfizer (PFE), which trade around $163 billion and $154 billion, respectively. 

At its current mark, the privately held payments company is valued just behind banking giant Charles Schwab (SCHW) which was recently trading around $169 billion. “Our programmable financial services now power more than 5 million businesses directly or via platforms, including all of the top AI companies, many of the largest blue-chip companies (90% of the Dow Jones Industrial Average), most of the biggest tech companies (80% of the Nasdaq 100), and a significant fraction of freshly minted startups,” the company’s founders John and Patrick Collison wrote in its annual letter.  While the company highlighted the uptick in business volumes, around 34% year-over-year, its founders gave significant space to stablecoins in their annual letter, noting the sector’s doubled payments volume last year—around $390 billion worth in total, according to a report from McKinsey. Stripe’s own stablecoin orchestration platform, Bridge, saw volume more than quadruple last year, according to the company.

Stripe completed its acquisition of Bridge for $1.1 billion last year and was granted a National Bank Trust Charter from the OCC last week to boost its stablecoin offerings.  “It may be a crypto winter, but it’s a stablecoin summer,” the Collison brothers wrote. “Stablecoin payments are advancing quietly and inexorably as real-world uptake continues apace.”  In addition to its Bridge acquisition, the company also announced plans last year to develop its own stablecoin-focused blockchain, Tempo, together with crypto venture capital firm Paradigm. The network, which remains in testnet, has already welcomed major firms like “Visa, Nubank, and Shopify,” who are “already testing Tempo for a number of use cases, including global payouts, embedded finance, and remittances,” the company letter noted.