What do you consider Stripe's potential $ 100 billion valuation?


This is The TechCrunch Exchange, a newsletter sent out on Saturdays based on the column of the same name. You can register for the e-mail here.

Welcome to a special Thanksgiving edition of The Exchange. Today we will be brief. But not quietly, because there is a lot to tell.

Above, The Exchange posted about the Slack Salesforce deal here. Please inform yourself if you missed this at the breakfast cake yesterday. And unfortunately, I have no idea why Palantir is seeing its value soar. Ordinarily we'd debate it and wonder what its profits could mean for the lower levels of private SaaS companies. However, since the movement of the public market appears to be an artificial increase in value, we will just wait.

Here's what I want to talk about this beautiful Saturday: Bloomberg reports that Stripe is in the market for more money, at a price that puts the company at "more than $ 70 billion or well above, up to $ 100 billion Dollar "rate.

Hot damn. Stripes would become 1st or 2nd major startup in the world at these prices, depending on how you count. Startup is an odd word for a company that is worth so much, but with Stripe still holding onto the private markets like a kind of life raft, continuing to raise outside funding, and presumably more focused on growth than profitability, it retains its typical characteristics at a tech startup, so we can safely call it one.

Which is strange, because Stripe is a huge problem that could run into twelve digits, assuming it gets that $ 100 billion price tag. It's hard to come up with a good reason why it's still private, other than the fact that it can get away with it.

Anyway, are these reported potential price maniacs? Perhaps. But they have a certain logic. Do you remember this place and PayPal The result indicated strong payment volumes over the past few quarters, which is good for Stripe's recent growth. Also note that Stripe was already "processing transactions valued at hundreds of billions of dollars a year" about 14 months ago.

This is where you can have fun math. Let's say Stripe's processing volume was $ 200 billion last September and $ 400 billion today, taking the number as an annualized metric. Stripe charges 2.9% plus $ 0.30 for a transaction. Let's call it 3% for simplicity and conservatively. That math has a run rate of $ 12 billion.

Now, the company's actual numbers could be closer to $ 100 billion, $ 150 billion, and $ 4.5 billion, right? And Stripe doesn't have the same gross margins as Slack .

But you can see why Stripe's new rumors aren't 100% wild. You can get the multiples working if you believe in the company's growth story. And to support the argument are his public compositions. Square's stock more than tripled this year. The value of PayPal has more than doubled. Adyen's shares nearly doubled. This is the kind of public market attraction that can really help a startup, at a very late stage, raise new capital and secure an aggressive price tag.

Finally, the possible new evaluation of Stripe could be useful. The fact that it is still a private company does not.

Market notes

Miscellaneous and miscellaneous

And as for Edtech, Equity's Natasha Mascarenhas and our intrepid producer Chris Gates have put together a special ep in the educational technology market. You can listen to it here. It's good.

Hugs and let's both do cardio