In today’s world, many companies are moving towards business models that utilize platforms that are almost entirely digital.
This is made possible through the use of cloud computing, which has become much more popular in recent years.
Services offered can include infrastructure as a service (IaaS), platform as a service (PaaS), serverless computers, as well as software as a service (SaaS).
That being the case, investing in companies that provide services through cloud computing can prove to be quite lucrative!
One such company that has proven to be highly valuable is Stripe.
Can Stipe stock be purchased? What exactly is Stripe, and why are they worth investing in?
We’ll be taking a deeper look at Stripe as a company, as well as their competitors, and what you need to know about investing in Strip stock!
Can You Buy Stripe Stock?
At this point in time, Stripe stock is not available for purchase, nor is it traded on the stock market.
Currently, there is not an initial public offering planned for Stripe.
Without a Stripe IPO, there is no way of knowing when Stripe stock will be available for purchase.
With the current worth of the company, and the expected growth that they’ll be undergoing if announced it may end up being the biggest IPO in recent history having to do with a financial technology company.
Many investors have made Stripe stock a hot topic, and the company’s IPO may be on the horizon.
Can You Buy Stripe Stock? Who Owns Stripe?
Stripe is privately owned and is currently owned by its founders, Irish brothers John and Patrick Collison.
While privately owned by the brothers, the company has undergone ten equity funding rounds with investments coming from companies like Sequia Capital, General Catalyst, and Founders Fund.
In addition to these venture capitalists, Stripe has received investors from angel investors like Elon Musk, Peter Thiel, and Elad Gil.
Can You Buy Stripe Stock? Stripe Background: What Is It?
Stripe is a financial services company specializing in finance technology and cloud computing services related to finances.
The company is widely known for its payment processing services, but there’s much more to the company than just that.
They like to call themselves the solution to the economic infrastructure for businesses of any size.
They help businesses accept payments, send payments, and manage the entirety of their financials online.
For the most part, Stripe offers their software as a service to other businesses, but they’ve been looking to expand into other areas in the financial industry as well.
Can You Buy Stripe Stock? Stripe’s Early Years
Stripe was founded in 2009 by brothers Patrick and John Collison in Palo Alto, California.
Originally, the company was part of the Ycombinator program under the name /dev/payments.
Ycombinator is an American seed money startup program, intended to be used by startups to accelerate the early-stage funding of new startups.
Many successful companies like Stripe have been initially funded by Ycombination including DoorDash, Airbnb, and Instacart.
Shortly after its inception, in 2011 Stripe was invested in by Elon Musk, Peter Thiel, Liam Casey, and venture capital firms Sequoia Capital, Andreessen Horowitz, and SV Angel.
The investment totaled at $2 million, far more than what the initial investment from Ycombinator had been. In 2012, the company moved its headquarters from Palo Alto to San Francisco, California.
In the following year, Stripe made its first of many acquisitions, purchasing Kickoff, a chat, and a task-management application.
Stripe More Recently
While the company’s main goal service related to payment processing, Stripe looked to expand, wanting to provide tools that allow a business to do more.
Stripe’s service builds economic infrastructure, and in order to make that infrastructure more complete, they began to develop new software for clients to use.
Among them were Radar, a fraud prevention program that intuitively blocks fraudulent transactions, and Atlas, a startup toolkit that covers incorporating a business’s banking, payment processing, and more.
For the most part, Stripe’s focus has been on creating applications and tools that focused on businesses online.
However, recently Stripe released a product in their lineup called Terminal.
Terminal is aimed at small businesses that need an option for in-person payments rather than solely online payments.
The service offers physical card readers that work with the Stripe software. Originally, the program was invite only, but became public in 2019.
Stripe Stock: How Does Stripe Make Money?
Simply put, Stripe makes money by charging a fee for every successful transaction that the app generates.
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When a purchase is made using the program, the vendor using Stripe is charged 2.9% of the transaction, as well as a $0.30 fixed fee.
To put into perspective how lucrative this business model is, this means that based on the percentage-based fee alone, Stripe is making $2.9 million for every $100 million that is processed using the software.
This is fairly impressive, as Stripe has to do next to nothing to make the money, they just need to provide the working software.
Stripe Stock: Investing in Other Businesses
As of late, Stripe has participated in funding for other businesses. In 2017, Stripe invested in U.K. challenger bank Monzo, and invested again in late 2018, helping the bank’s value nearly quadruple through the fundraising.
Additionally, Stripe invested in Monzo again in 2019 in a round of funding that nearly doubled the value of the bank.
Furthermore, Stripe has led fundraising rounds for other finance-based businesses like Paystack (which they would go on to acquire) and PayMongo.
They have also invested in Step, a bank offering fee-free banking for teens, and Fast, a company dedicated to creating a one-click checkout service that will be universal.
While Stripe may be a giant in the fintech world, they’re also keen on investing in companies that they may eventually partner with or acquire, depending on the circumstances.
Stripe Stock: Why Is Stripe Valuable?
Stripe has been called the most valuable startup in America and has made itself an incredibly valuable company for a plethora of reasons.
It has a great reputation for the services it provides is simple and easy to use.
Making Online Payments Easy
Before Stripe, accepting payments on websites was costly, and more importantly, it was complicated.
The company helped to change the way online businesses functioned, providing an easy way to accept online payments for the first time.
Making things even more simple, they also found a way to integrate with a range of online hosting websites and providing their customers with pre-built code depending on the platform they use.
Friendly For Customers and Their Users
The company doesn’t only provide a high-quality product to its customers, though; they also provide high-quality customer service.
Stripe has one of the best reputations in their niche for the way they treat their customers and serve them.
The most prominent way they do this is by staying in the background.
Stripe’s largest competitor, PayPal, makes sure that the user knows they’re using a PayPal checkout.
Stripe forgoes this, allowing the experience of shopping on a small business’s website a seamless experience.
For the reasons listed alone, Stripe has become the default online payment processing service for most small businesses.
With its entry into the brick-and-mortar market, Stripe is sure to continue to grow and increase its value in the fintech industry.
Can You Buy Stripe Stock? Stripe Competitors You Can Buy
If you’re looking to invest in Stripe stock, you may be waiting quite some time for a Stripe IPO to be announced.
In the meantime, there are publicly traded competitors of Stripe that can be invested in!
Take a look at our list of companies similar to Stripe that are available today on the stock market.
PayPal Holdings Inc. (NASDAQ: PYPL)
Arguably Stripe’s largest competitor, PayPal is another fintech company that is a suitable replacement for Stripe in your investment portfolio.
Paypal was founded in 1998 in the United States, originally as Confinity.
The original intent of the company was the creation of security software for handheld devices, but that swiftly changed when the company saw no success in the endeavor.
In 1999, their first electronic payment system was established, and the company began to see notoriety.
In 2000, the company was acquired by X.com, who was owned by Elon Musk.
Musk focused his attention on the company’s electronic payment system.
In 2001, the company was formally renamed Paypal, and in 2002 had their initial public offering.
At the time of its IPO, PayPal’s shares were an inexpensive $13 per share.
Despite the low cost, the company generated $61 million from the IPO, a figure that’s notable when it comes to initial public offerings.
At the time of writing this article, PayPal shares are hovering at just under $290 a share, a significant increase in the stock price over the last 19 years.
Square Inc. (NYSE: SQ)
A contemporary to Stripe, Square is another publicly traded company that presents as an excellent alternative to Stripe stock.
Square was founded by Jack Dorsey and Jim McKelvey in in 2009 in St. Louis, Missouri.
The idea occurred to Dorsey, who also founded Twitter, when McKelvey couldn’t complete a sale due to an inability to accept credit cards.
Dorsey and McKelvey got to work quickly, developing the company and product in less than a year’s time, launching in 2010.
Square is a digital payments company, like Stripe, but rather than being focused on online businesses, the company created mobile credit card readers, allowing small businesses to accept card payments without the need to contract through larger payment processing companies.
In addition to their credit card processing services, Square launched several other products under the Square name.
Square Capital was created as a way to offer business financing to merchants using the company, and issued the app called Square Cash, allowing users to send each other payments directly.
Square Cash would late be renamed Cash App, and is used by millions of people a year. Square’s business model is similar to that of Stripe, charging a base percentage and transaction fee for every transaction made using the software.
Stripe Stock: What Is Stripe Worth?
Stripe has come a long way since its founding in 2009.
In twelve short years, the company has grown from a small, ambitious startup to the most highly valued startup in the country, being worth more than SpaceX.
Stripe is used by many online businesses without customers even knowing that it’s being utilized. In 2020, Stripe’s net revenue was $7.4 billion.
With another round of funding having taken place in March of 2021 resulting in $600 million raised, Stripe’s value skyrocketed.
The company has a private valuation of $95 billion at this point in time, nearly $60 billion more than it was valued at during the same time period last year.
Should Stripe stock become available, you can be sure that the starting price will be high, based on the fact that the company has no trouble raising large amounts of money on its own.
Stripe Stock: Final Thoughts?
Stripe has proven itself to be quite the unicorn in the financial technology market, growing from a small startup in 2009 to the most valuable startup ever conceived as of this year.
Stripe offers a variety of high-quality services and software to their customers and client base and has an incredible reputation for going above and beyond for the people using their services.
They changed the way online payments can be taken, taking inspiration from competitors like PayPal, but streamlining the process into a more user-friendly experience.
Because of their $95 billion valuation, you can be sure that should there be a Stripe IPO, the Stripe stock price will be high.
Unfortunately, at this time, a Stripe IPO has not been announced, and according to investor Sequoia, planning for an initial public offering would take place over at least a year.
If you’re looking to buy Stripe stock, but can’t wait for an IPO, looking at their competitors that are publicly traded on the stock market could be worth your while.
Two competitors that are on the stock market right now are PayPal and Square, both of which are excellent alternatives to Stripe.
If you’re patient though, holding out to buy Stripe stock isn’t a bad idea, considering just how much they’re worth, and the waves they’ve made in the last few years alone.
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