Stripe is Building the Internet’s Economic Infrastructure

Stripe, the technology company building the Internet’s economic infrastructure, is rumoured to be on the verge of an initial public offering (IPO). The fintech unicorn last week raised $600 million in a Series H funding round, which valued the company at $95 billion, an almost three-fold increase from its April 2020 valuation of $36 billion from April 2020, per PitchBook data. According to a press release, the company plans on using the funds to expand its European operations. Thirty-one of the 42 countries that Stripe operates in, are in Europe. The company cited Ireland, where it is headquartered, as a particular focus of attention. 

According to the press release, the funding raised was partly due to backing from two insurance giants: Allianz, through its Allianz X fund, and Axa. Other backers are Baillie Gifford, Fidelity Management & Research Company, Sequoia Capital and Ireland’s National Treasury Management Agency (NTMA). The presence of two insurers is perhaps an indication of where the company is going. 

The company was funded over a decade ago, and is the most valuable private fintech company in the world, by quite a stretch. Robinhood, the second most valuable fintech company, is valued at around $11.7 billion since it raised $3 billion in private funding during the GameStop mayhem. The global health crisis pushed the world online and accelerated Stripe’s revenue as people turned to online shopping. 

Despite the company’s growth and rising valuation, it has refrained from speaking about an IPO. Indeed, it is unlikely that the company would seek an IPO soon after its Series H funding. Questions surrounding its next steps are growing. The company has kept its own counsel regarding its profitability, revenues, user numbers and other operational and financial details. Without these details, it is hard to form an estimate of the value and performance of the company thus far. 

Stripe Treasury is an Indication of the Power and Ambition of Stripe

Stripe is revolutionizing online payments. It’s last innovation, launching Stripe Treasury, is indicative of the power and ambition of the platform. As per the website, “Stripe Treasury is a banking-as-a-service API that lets you embed financial services in your marketplace or platform. With a single integration, enable your customers to hold funds, pay bills, earn interest, and manage cash flow.” 

Using Stripe Treasury, platforms such as Shopify can offer their merchants access to financial tools to help them manage their finances. Stripe Treasury also offers users interest-earning accounts that are eligible for Federal Deposit Insurance Corporation (FDIC) insurance. The accounts are enabled by Evolve Bank & Trust. Revenue earned on Stripe is available nearly instantly and can be spent using a dedicated card, transferred via wire transfer or ACH, used to pay bills and many other transactions. 

Although Stripe Treasury is banking-as-a-service, the company is very careful to indicate that it is not a bank. Indeed, Stripe works with many banks, such as Goldman Sachs. Stripe isn’t directly competing with banks for a medspa franchise opportunity.It intends to democratize access to banking through its powerful APIs by developing a thick bank partner network. Currently, that includes Goldman Sachs Bank USA and Evolve Bank & Trust in the United States, and Citibank N.A. and Barclays as global expansion partners. 

Stripe fulfills its regulatory and compliance requirements in partnerships in conjunction with its US banking partners to facilitate ease of use of Stripe Treasury by its platform customers. The banks are able to use Stripe to reach millions of businesses. 

Stripe Treasury is a textbook example of the power of platforms. Stripe allows any number of online merchants to tap into the capabilities of any number of bank partners thanks to Stripe, which sits at the middle of this relationship. 

An example of this is how a platform customer can create a bank account with Goldman Sachs for a pilot on Rocket Rides. Rocket Rides cannot offer bank accounts with Goldman Sachs, and Goldman Sachs cannot offer bank accounts to individual merchants. However, through the platform, problems such as these can be resolved. Stripe connects people on different sides of its market to help them with their particular needs and mobilize their capabilities. 


Stripe Treasury, as well as other innovations such as Capital for platforms, and its partnership with Shopify, add to the sense that Stripe truly is trying to build the economic infrastructure of the future. Stripe believes that it is only just getting started.The company is still developing the products and global payments and treasury network that are necessary to build the internet’s economic infrastructure. 

It would be interesting to see an S-1 from Stripe. However, this is unlikely to happen any time soon. The company is also unlikely to go the way of a SPAC. One assumes that the core business is profitable and spits out a lot of free cash. The business has increasingly focused on spending its money on acquisitions and investments to build the internet’s economic infrastructure. Stripe’s stated ambition is massive. Whether it can actually get there is yet to be seen.