Stripe is a pain in the ass as a buyer, so I really hope they won't be able to acquire competitors and become a de facto monopoly.
For example, when you're traveling abroad and can't buy a service online with your card, you can be 95% sure that Stripe is the payment processor.
Maybe true but I’ve never had a worse experience than I have with PayPal, truly an awful company
Well for an expats, it's really a gamechanger not having to play three card monte selecting the correct card to use for each transaction. You would be surprised how many transactions are (accidentally?) geofenced based on where your card is issued from, and Paypal pretty much solves these.
Yeah, but PayPal is an even bigger pain.
> Stripe hit a $159 billion valuation on Tuesday and said it was on track to reach an annual run rate of $1 billion this year.
Wow! This is the quality of reporting from CNBC? The $1B ARR number is just for Stripe's Revenue products (Billing, Invoicing, etc). That doesn't include their main business (payments-related products).
I used to live in the United States and recently moved to Germany. Using PayPal for payments is a lot more common here than Germany. In fact I connected my Uber account to my credit card via PayPal and my partner pays for a lot of things online via PayPal.
PayPal is also used for transferring money between friends and family quite frequently
I have been trying to help someone in Guatemala receive payments from international tourists and PayPal seems to be the best option we've found, even though I don't like using it (horror stories about money being stranded in locked account, etc).
Not good. Stripe rejects anyone even close to the regulated cannabis space (with no room for appeal) but PayPal will accept these tranctions. So, this would put a non-zero amount of businesses (that don't even touch that deadly, deadly plant) in a tight spot with this monopolisation of the industry.
I don't think anything would change. If Stripe's underlying providers (banks) aren't involved then their requirements would not apply.
Stripe doesn't want to reject anyone, but their banks/underwriters do not have a limitless appetite for risk.
Someone new will arise to fill the market gap if there is demand. Saw it firsthand here with the Marijuana industry in Michigan shifting around payment providers to accept credit card transactions after it was legalized. A lot of hoops had to be jumped through. I think it still has the potential to be bad, but it does give opportunities.
If you had any pointers I'd be grateful
Will anyone be getting arrested for insider trading? It spiked on rumors yesterday when nearly everything else was collapsing.
Haven't you heard? Crime is legal
Also anti-trust, monopolies and insider trading are all legal.
The SEC won't do anything.
That feels like it would be a pretty significant blunder for stripe. Paypal is everything that stripe isn't. Legacy, confusing, slow, expensive and hidebound.
When a company with good tech buys out a company with crap tech, they're not paying for crap tech — they're paying for the user base.
I would wager that Stripe has already put together a consumer-cash platform, and is weighing whether to deploy it as "Stripe Cash" or "Paypal 2.0". The former strategy would require a slow rollout that would compete with Paypal, Apple Cash, whatever Google and Samsung’s offerings are called… The latter branding would make them the dominant player overnight.
On the other hand, they are getting rid of a competitor.
They're going to become PayPal. There's no scenario where that doesn't happen as they get larger and larger and larger. Especially as competition is eliminated.
That would mean they would be acquiring Venmo as well?
I feel like PayPal is slowly degrading, I hope Stripe would find a way to modernize it.
When Seagate (then a reputable hard drive manufacturer) purchased Maxtor (then the bottom-of-the-barrel for both price and reliability) I hoped Seagate would rehabilitate their newly acquired facilities and bring them up to the same quality.
I was disappointed.
Stripe is overvalued by about 10x judging by Block and PayPal.
Best case scenario: Stripe gets larger, gets bloated, slower, eats some competitors, becomes their competitors. The street presses down on their valuation as their growth races toward single digits. Congratulations.
Block is fetching ~13 times op income. PayPal is fetching ~7 times op income.
And it’s still private. So no proper price finding has occurred yet.
People always want the upstart hotness. Look at the shiny growth (which is meaningless if they're just going to end as a slow growth obese giant anyway, it's all rinse & repeat).
Maybe Stripe sees the end writing on the wall and they're going for it while the bubbly action is there.
> PayPal’s stock has plummeted over the last year as it faces slowing growth and mounting competition in the digital-payments market.
What is the mounting competition? Does Paze factor into any of this?
Do you know anyone using Paze?
FedNow is what has PayPal's former investors so terrified (so much so that investors don't even think PayPal warrants a double digit multiple).
No cost instant financial transfers between US financial users is coming over the next decade. The Fed has 1,400 banks onboard so far, up from 900 the prior year (that's 1,400 in two years). Half of PayPal's business goes away over the coming decade.
cool, more market consolidation
You have it backwards, great opportunity to start a niche competitor for whatever feature they'll remove once the acquisition is done!
Creating a payment processor is extremely complex and expensive. It's not easy to start a niche competitor.
When’s the last time a private company acquired a public company? Crazy!
Not all that different from Musk buying Twitter. Happens pretty often with private equity as a buyer.
Mostly private equity companies do this.
Bending Spoons bought Vimeo.
Hellman & Friedman bought Zendesk.
Now how can a company that launched many people’s successful career of meddling in everyone’s affairs be acquired by a company that was launched 10 years later, interesting.