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Visa is acquiring Plaid for $5.3 billion, 2x its final private valuation


Visa is acquiring Plaid for $5.3 billion, 2x its final private valuation – TechCrunch

Visa announced today that it is buying financial services API startup Plaid for $5.3 billion. 

Plaid develops financial services APIs. It is akin to what Stripe does for payments, but instead of facilitating payments, it helps developers share banking and other financial information more easily. It’s the kind of service that makes sense for a company like Visa.

The startup bought Quovo two years ago to move beyond just banking, and into broader financial services and investments. The idea was to provide a more holistic platform for financial services providers. As the founders wrote in a blog post at the time of the acquisition, “Financial applications have historically used Plaid primarily to interact with checking and savings accounts. In acquiring Quovo, we are extending our capabilities to a wider class of assets.”

The deal is expected to close in the next three to six months, pending regulatory approval.

The Price

Plaid’s exit price is a triumph for its investors, who put a combined $353.3 million into the company, according to Crunchbase data. Most important among those rounds was a $250 million infusion that came in late 2018. Index and Kleiner led that round, valuing Plaid at $2.65 billion, or 50% of its final sale price (we doubt that that ratio is a coincidence).

At the same time, it was later revealed, Mastercard and Visa also took part in the round, with TechCrunch reporting in 2019 that the two payments giants “quietly participated in the round.” 

Whether those investments were large enough to grand Visa information rights isn’t clear, but certainly the two credit card giants had more insight into what Plaid was doing than they did before their investment. We can presume, then, that Plaid was doing well as a private company; no one pays twice a multi-billion dollar valuation for a firm unless they want to keep it away from their core business, or a key competitor. 

Or perhaps both in the case of Plaid.

The Twilio comparison

Plaid is often compared to Twilio, another API-first company that sits in the background, helping other players do business. Noyo, on the early-stage front, is doing something similar with its healthcare information and insurance APIs. Stripe, as mentioned above, is similar but in the payment space. The model has proved lucrative for Twilio, which has soared as a public company; Plaid’s huge exit will add extra shine to the startup varietal.

However, unlike Twilio, Plaid was bought while still private, depriving us of a good look into its figures. We anticipate that they would show growth in high-margin revenues. That’s something that all companies, public and private, covet.

For Visa, however, there’s likely something more to the deal. Namely it now has a view into scads of high-growth, private companies that are reinventing the world that Visa operates in. Buying Plaid is insurance against disruption for Visa, and also a way to know who to buy. 

But for today, it’s a win for Plaid shareholders (including employees).

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Every radical turn in technology history has its great entrepreneur, and for space that person is SpaceX founder Elon Musk. His unswerving conviction that u201cspace must be affordableu201d led him to disrupt the old-school space launch industry with reusable Falcon 9 boosters, an achievement that has inspired hundreds of entrepreneurs and investors to take up […]n”,”protected”:false,”author”:36697590,”featured_media”:1932023,”comment_status”:”open”,”ping_status”:”closed”,”sticky”:false,”template”:””,”format”:”standard”,”meta”:”outcome”:””,”status”:””,”crunchbase_tag”:0,”amp_status”:””,”relegenceEntities”:[],”relegenceSubjects”:[],”jetpack_publicize_message”:”Disrupting Space: A new event from TechCrunch https://tcrn.ch/3a5l7KD”,”categories”:[426985170,174,17396],”tags”:[],”crunchbase_tag”:[],”tc_stories_tax”:[],”tc_event”:[576727286],”jetpack_featured_media_url”:”https://techcrunch.com/wp-content/uploads/2020/01/TC-Sessions-Space-Post-Image.png”,”jetpack_publicize_connections”:[],”shortlink”:”https://tcrn.ch/3a5l7KD”,”rapidData”:”pt”:””,”pct”:””,”featured”:false,”subtitle”:””,”fundingRound”:false,”seoTitle”:””,”seoDescription”:””,”premiumContent”:false,”premiumCutoffPercent”:1,”tc_cb_mapping”:[],”associatedEvent”:”ad”:”display”:true,”title”:”Tickets are now available to discover the next frontier in space – get yours now and save $150″,”override_link”:””,”date”:1593043200,”link”:”https://techcrunch.com/events/tc-sessions-space-2020/”,”status”:”pre”,”title”:”TC Sessions: Space 2020″,”termID”:576727286,”event”:1931495,”authors”:[1551056],”hideFeaturedImage”:false,”_links”:”self”:[“href”:”https://techcrunch.com/wp-json/wp/v2/posts/1932016″],”collection”:[“href”:”https://techcrunch.com/wp-json/wp/v2/posts”],”about”:[“href”:”https://techcrunch.com/wp-json/wp/v2/types/post”],”replies”:[“embeddable”:true,”href”:”https://techcrunch.com/wp-json/wp/v2/comments?post=1932016″],”version-history”:[“count”:8,”href”:”https://techcrunch.com/wp-json/wp/v2/posts/1932016/revisions”],”predecessor-version”:[“id”:1932324,”href”:”https://techcrunch.com/wp-json/wp/v2/posts/1932016/revisions/1932324″],”authors”:[“embeddable”:true,”href”:”https://techcrunch.com/wp-json/wp/v2/guest-authors/ned-desmond”],”https://techcrunch.com/edit”:[“href”:”https://techcrunch.com/wp-admin/post.php?post=1932016&action=edit”],”author”:[“embeddable”:true,”href”:”https://techcrunch.com/wp-json/tc/v1/users/36697590″],”wp:featuredmedia”:[“embeddable”:true,”href”:”https://techcrunch.com/wp-json/wp/v2/media/1932023″],”wp:attachment”:[“href”:”https://techcrunch.com/wp-json/wp/v2/media?parent=1932016″],”wp:term”:[“taxonomy”:”category”,”embeddable”:true,”href”:”https://techcrunch.com/wp-json/wp/v2/categories?post=1932016″,”taxonomy”:”post_tag”,”embeddable”:true,”href”:”https://techcrunch.com/wp-json/wp/v2/tags?post=1932016″,”taxonomy”:”_tc_cb_tag_taxonomy”,”embeddable”:true,”href”:”https://techcrunch.com/wp-json/wp/v2/crunchbase_tag?post=1932016″,”taxonomy”:”tc_stories_tax”,”embeddable”:true,”href”:”https://techcrunch.com/wp-json/wp/v2/tc_stories_tax?post=1932016″,”taxonomy”:”tc_event”,”embeddable”:true,”href”:”https://techcrunch.com/wp-json/wp/v2/tc_event?post=1932016″],”curies”:[“name”:”wp”,”href”:”https://api.w.org/rel”,”templated”:true],”_embedded”:{“authors”:[“id”:1551056,”name”:”Ned Desmond”,”link”:”https://techcrunch.com/author/ned-desmond/”,”description”:”Ned Desmond is COO of TechCrunch. He was also responsible for Crunchbase from April 2012 until September 2015, when Crunchbase spun out of AOL/Verizon to become a standalone, venture-backed company. “,”slug”:”ned-desmond”,”links”:”facebook”:”http://www.facebook.com/ned.desmond”,”twitter”:”http://twitter.com/neddesmond”,”linkedin”:”http://www.linkedin.com/in/neddesmond”,”crunchbase”:”https://www.crunchbase.com/person/ned-desmond”,”position”:”Contributor”,”cbDescription”:”

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Ned Desmond is the COO of TechCrunch General Manager of AOL Tech and Engadget.nn

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Ned Desmond is the COO of TechCrunch General Manager of AOL Tech and Engadget.nn

He was also responsible for CrunchBase from April 2012 until September 2015, when Crunchbase spun out of AOL/Verizon to become a standalone, venture-backed company, in partnership with Emergence Capital.nn

Previously he was the founder and president of GoSportn, an enthusiast media company, which launched GoFISHn.com and GoHUNTn.com.nn

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long-tail success after a breakout game”,”content”:{“rendered”:”

For many gamers, Poku00e9mon GO was an exciting fad that ate up their summer and was just another chapter in a franchise. A lot of these people would already treat the game like some sort of nostalgic mid-2010s hit, but the game is minting cash from users at a more expansive rate that ever. A report in Sensor Tower this week estimated that 2019 was Niantic’s best year to date in terms of in-app purchase revenue from Poku00e9mon GO users, noting that the company likely pulled in nearly $900 million according to its estimates.n

The rate of user revenue is still lower now than it was following launch, Poku00e9mon GO launched in just a few markets at the beginning of July 2016 and Sensor Tower estimates its revenue reached $832 million in the final six months of that year. But with higher year-over-year totals compared to 2017 and 2018, the estimates do suggest that Niantic’s aggressive updates to gameplay and its in-game social features helped boost revenues.n

""n

The truth is, every couple years there’s a new gaming title that accumulates users at a startling pace. What happens after the press cycle churns and the game is left to its own devices is where the great studios prove themselves. Niantic is in a cushy position as its breakout title fills its coffers, but the company still has some soul-searching ahead of it as it simultaneously aims to chase a follow-on hit and a developer platform.



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I'm a 50 year old PLC programmer from Burnley, UK. I severed my time as an electrician in the baking industry and soon got involved with the up and coming technology of PLC's. Initially this was all based in the Uk but as the years went by I have gradually worked my way around the globe. At first it was mainly Mitsubishi with a bit of Modicon thrown in but these days the industry leaders seem to be the Allen Bradley range of PLC and HMI’s.

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