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Fintech

Fidelity marked up Stripe shares by 32% going into 2024

Stripe’s share value jumped in Fidelity’s December report after a tech stocks bull run closed out 2023.

Fidelity Investments marked up its Stripe holdings to $24.59 per share at the close of 2023, a 32% jump from its August price, according to an annual report published last week.

The rebound in Stripe’s paper valuation reflects how a surging stock market has improved the outlook for IPO hopefuls and provided some reprieve for the fund managers that have been forced to significantly write down their startup stakes in recent years.

Despite the recent appreciation, Fidelity’s holding in the payments company is marked well below Stripe’s 2021 price, when it was valued at more than $41 per share. That year, Fidelity first invested in Stripe’s blockbuster Series H, a $600 million round at a $95 billion valuation.

“The multiples for payments companies have rebounded over the last year,” according to Abdul Abdirahman, principal at VC firm F-Prime Capital. The stock price of Adyen, Stripe’s closest publicly traded competitor, has more than doubled since early November. PitchBook’s global fintech unicorn index has climbed more than 18% during that period.

Investors are closely watching publicly traded fintech companies in anticipation of several major fintech public listings in 2024. Stripe and Plaid are considered leading contenders for an IPO once conditions improve. Both companies hired new CFOs last year, which is often a signal that a company is readying for a public listing.

“A lot of these companies have raised so much capital in private markets … It’s hard for me to imagine Stripe raising another $10 billion [privately],” Abdirahman said.

The payments giant took criticism from early investors and employees for not riding 2021’s fintech bubble to a public listing. Stripe was forced to scramble to raise new capital last year—at a significant valuation discount—to avoid employees’ stock units expiring.

Correction: An earlier version of this article mistakenly referred to Steffan Tomlinson as Stripe’s first CFO. The company has had other CFOs before Tomlinson. (Feb. 28, 2023)

Featured image by San Francisco Chronicle/Getty Images

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