By Ben Lucas
Tech firms shouldn’t worry so much about valuations, the co-founder of Stripe has said, after the payments firm’s valuation was cut earlier this year.
Stripe cut its valuation to $50bn (£39bn) in March this year, which is well below its peak of $95bn back in 2021.
The valuation was slashed as it announced a new $6.5bn funding round from some of the firm’s existing shareholders, such as US venture capital firm Andreessen Horowitz and British investment management firm Baillie Gifford, as well as new investors including Goldman Sachs and two Singaporean state investors, Temasek and sovereign wealth fund GIC.
But co-founder of the Irish-American firm John Collison said he was unphased by the near 50 per cent drop in its valuation.
“Stocks prices go up, stock prices go down,” Collison said in an interview with The Sunday Times.
“A lot of high-growth companies have traded down 70, 80, 85 per cent in some cases,” he said.
“Even before the latest funding round, people inside Stripe – they’re very smart – were not expecting that the way Stripe was valued in 2021 was the way it would be valued in 2023,” he added.
“But also, you don’t feed your family with equity valuations. It’s really a mistake for founders to get caught up in all that,” he said.
Stripe has remained privately owned since it was founded in 2009, despite recurring speculation about a possible IPO.
But Collision insisted that option was not on the table. “We have no plans to go public,” he said.
