Summary of Sequoia Capital’s Offer to Legacy Fund LPs for Stripe Shares
- Offer Details:
- Opportunity for LPs: Sequoia Capital offers limited partners (LPs) of some legacy funds the chance to sell their shares in Stripe.
- Transaction: New purchasers, including Sequoia’s various funds (Expansion Fund, Sequoia Capital Fund, Sequoia Heritage, and Sequoia Capital Global Equities), will commit to buy up to $861 million of Stripe shares.
- Valuation: Stripe’s current fair market value is assessed at $70 billion, down from $95 billion three years ago but up from $50 billion last year. Current share price is $27.51.
- Investment Background:
- Sequoia’s Investment in Stripe: Sequoia Capital has invested a total of $157 million into Stripe since 2010.
- Options for LPs:
- Choice to Sell or Hold: LPs can choose to sell all or a portion of their Stripe shares or hold them.
- No Carried Interest: Those who choose to sell will benefit from no carried interest.
- Deadline: LPs have until 14 August to decide.
- Context and Similar Offers:
- February Offer: Similar offer was made to current and former Stripe employees in February, resulting in Stripe raising $694.2 million in April.
- Speculations of IPO: These offers and other developments have led to speculation about Stripe’s potential stock market flotation, though it remains unconfirmed.
- Sequoia Capital’s Intentions:
- Investor Relations: Sequoia aims to appease investors of mature portfolio companies, acknowledging different goals for liquidity and portfolio management.
- Optimism about Stripe: Despite offering the sell option, Sequoia remains highly optimistic about Stripe’s future.
- Additional Context:
- Acquisition of Okay: Stripe acquired software start-up Okay in 2023, fueling further IPO speculation.
