Stripe Secures $ 600 Million Funding to Bring Merchant Coronavirus Help | Payments Source
The payments unicorn Stripe claims it has the financial power to apply its technology to coronavirus medical care, remote telecommuting, business financing, and easier onboarding for businesses that have suddenly been pushed into a Internet existence.
Stripe said Thursday it raised $ 600 million from Andreessen Horowitz, General Catalyst, GV and Sequoia, on the same terms and valuation as its existing Series G funding. Over the past few years, Stripe has pulled a string of investments from these and other VC firms that have helped its valuation soar to over $ 36 billion.
As part of the investment, Stripe said it has activated a suite of coronavirus-related programs, such as “quick access” to funds through instant payments, Stripe Capital, Stripe Corporate Card and other measures to help clients. small businesses to access government assistance. Striped marquee argues it can process merchant credit requests in a day, a key part as Stripe battles with Square and PayPal to save small businesses that are closed due to home orders and often have only a few weeks or less of money on hand.
Stripe’s new investment comes less than a week later Pay Pal President and CEO Dan Schulman said his company would provide quick loans to small businesses under government assistance programs.
Square recently received an industrial banking license, which will allow it to directly grant loans to small businesses. cabbage earlier this month it had accepted nearly 40,000 applications for small business loans as part of the government’s stimulus effort.
The moves come as the U.S. government’s small business loan facility under the Paycheque Protection Program initial funding is running out and waiting for a new round of government funding. Stripe and other fintechs such as Square, PayPal and Kabbage also tried to expand their small business credit programs during the economic downturn linked to the coronavirus.
“Being able to create a lending facility digitally is important,” said Richard Crone, payments consultant, adding that companies like Square and PayPal have demonstrated the scale needed to support fast lending to small businesses. “Square and PayPal let you push a button and, if you qualify, get credit on your future receivables. … Stripe is going to have to scale at the speed of PayPal.
Beyond this investment, Stripe has taken several other steps, such as accelerating support for telemedicine providers such as Solv, which is working with Stripe to provide physician-assisted forms of coronavirus testing and patient care. emergency the same day. The payment company has elastic scaling capability for businesses that already use Stripe to process payments, noting that some, like Instacart, have seen up to 300% increase in customer demand. from one year to the next.
Stripe has also reduced the work it takes to launch a business on its platform, including allowing farmers to sell produce online, working with mall operator Westfield to support a platform to help retailers to move online in Australia, a partnership with US restaurant technology company ChowNow to launch a loyalty product, and an agreement with French B2B farmer’s market Rungischez You to use Stripe to sell direct to consumers.
Stripe reports that it has over $ 2 billion on its balance sheet, and in 2020 added Caviar, Coupa, Just Eat, Keap, Lightspeed, Mattel, NBC, and Paid as customers. On Thursday, Stripe said meeting company Zoom, which has increased its usage in recent weeks, will use Stripe to modernize its payments system and expand internationally.
As businesses recover from the economic toll of the pandemic, Stripe will be competing with other traditional fintechs and acquirers.
Stripe also competes with merchant service providers FIS, Fiserv and Global Payments, all of which have strengthened their ties with the bank over the past year through a series of mergers that combine payment processing and card issuance.
“Stripe has to go fast here, and they’re going big,” Crone said.
Stripe has gradually added to its core base to enable businesses to sell online. Earlier this year, the company partnered with Separate it to support point-of-sale credit, by expanding Stripe’s profile in installment payments, which are an increasingly popular alternative to credit cards for larger purchases.
More recently, Stripe made a Series A investment in Fast, a San Francisco startup that activates a universal buy button for multiple merchants, giving Stripe access to technology similar to the card networks’ universal payment experience for cardless transactions.