Fintech Plaid raises $575M at a $6.1B valuation, says it will not go public in 2025

Summary

Plaid, which connects bank accounts to financial applications, has sold about $575 million worth of common stock at a $6.1 billion post-money valuation, the fintech company confirmed to TechCrunch. The valuation is about less than half of the $13.4 billion that San Francisco-based Plaid was valued at when it raised a $425 million Series D in April 2021 in a round led by Altimeter Capital. A spokesperson acknowledged the decrease, saying it was “simply a reflection of the contraction of multiples across the market.” Indeed, higher interest rates have led to lower valuations for many startups that last raised at the top of the high cycle in 2021. Still, Plaid’s new valuation is about 15% higher than the $5.3 billion Visa was going to pay for the company before that acquisition deal fell apart in January of 2021 due to regulatory concerns. Plaid will not go public in 2025 but it is a milestone the company continues “to track towards,” according to the spokesperson. In October 2023, Plaid named former Expedia exec Eric Hart to serve as its new chief financial officer. The fact that it appeared to be eyeing an IPO — albeit with no timeline — drew attention. Today, the company maintains that it is “well-capitailized.” “Plaid’s business is in a great position and we’re optimistic about the opportunity ahead,” the spokesperson said. Franklin Templeton led the “oversubscribed” raise, which also included participation from new backers Fidelity Management and Research, BlackRock, and others in addition to existing investors NEA and Ribbit Capital. Plaid characterized the transaction as “not a Series E,” but rather a sale of common stock, which involves a company directly issuing new shares to raise capital. This is different from a secondary share sale, which occurs when existing shareholders sell their shares to other investors, without the company receiving any new capital. The proceeds of the round will be used to address employee tax withholding obligations related to the ...