Fintech giant Stripe revealed in its annual letter published on Wednesday that it surpassed $1 trillion in total payment volume in 2023, up 25% from 2022.
This milestone, coming 15 years after the company was founded, provides a glimpse into the financial health of one of the world's largest private companies and how quickly it is growing. In comparison with, PayPal Total disbursement volume exceeded $1 trillion in 2021, 23 years after its founding.
Co-founders and brothers Patrick and John Collison attributed this growth to Stripe's business, the fast-growing startups adopting its products, and its invoicing and tax services.
“We've spent a lot of time focusing on that overall growth,” Stripe President John Collison said in an interview with Andrew Ross Sorkin on Squawk Box that aired Wednesday.
“We spent all of last year with people anticipating all kinds of doom and gloom,” he said, adding that “so far, consumer spending has held up pretty well.”
Stripe is valued at $65 billion as of the company's most recent tender offer completed last month. This is an increase from its last valuation of $50 billion, but still far from its high of $95 billion in 2021.
“Startups are doing themselves no favors by denying the existence of a new economic reality,” Collison told Sorkin. “We've always been very concerned about shareholders. We wanted to ensure shareholders had liquidity, and that's why we made the tender offer last year, and that's why we made the tender offer this year.”
The company's annual letter also revealed surprising statistics about startups.
Despite tepid startup fundraising conditions last year, which fell to a six-year low according to PitchBook, the Collison brothers say their data suggests startups founded in 2022 are generating revenue at a faster pace than those founded in 2019. In particular, synthetic intelligence startups outperform other sectors.
“Things got a little crazy at the peak of 2021… startups are focusing on more profitable growth,” Collison explained to Sorkin on “Squawk Box.” “Because the inference costs are so high for AI products, you actually tend to see paid products from these startups much earlier than you would from other companies.”
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