Stripe Offers $53 Billion to Acquire PayPal and Its Remaining 11 Users Who Haven’t Switched to Apple Pay
SAN JOSE, CA — In a landmark financial technology deal, Stripe and private equity firm Advent International have reportedly offered $53 billion to acquire PayPal, its popular Venmo app, and the priceless collection of 2006-era checkout buttons still scattered across America’s abandoned small-business websites.
The proposed acquisition would combine Stripe’s sleek, modern payment infrastructure with PayPal’s core competency: asking customers to enter a six-digit security code, solve a CAPTCHA, confirm their identity by text, reset a forgotten password, and then return to the merchant’s website to discover their shopping cart is now empty.
“This is about bringing together two iconic companies,” said a person familiar with the offer. “Stripe processes the future of commerce. PayPal sends you an email saying someone you don’t recognize has requested $14.72.”
At roughly $60.50 per share, the offer represents a 28 percent premium over PayPal’s previous market value and a 4,000 percent premium over the amount most Americans assumed PayPal was worth after trying to cancel an automatic payment.
Stripe is reportedly most interested in Venmo, the digital wallet used by millions of Americans to split dinner checks, pay fantasy football dues, and publicly document transactions with descriptions such as “🍆💦 rent lol” despite having parents, employers, and federal investigators on the same platform.
Analysts believe Stripe could generate substantially more revenue from Venmo by introducing innovative new features, including:
“Instant Transfer Plus,” which would move your money immediately for only slightly more money.
“Venmo Premium,” allowing users to hide the financial evidence of their cocaine purchases from former high school classmates.
“Venmo Professional,” which automatically changes “pizza 🍕” to “independent consulting services” before tax season.
“Venmo Private Equity,” which lets users borrow $37 billion to buy Venmo using Venmo.
PayPal has struggled in recent years as consumers increasingly choose Apple Pay, Google Pay, Shop Pay, credit cards, debit cards, bank transfers, cash, checks, loose quarters, casino chips, and simply abandoning the purchase rather than remembering their PayPal password.
The company’s share price has fallen 24 percent over the past year, prompting PayPal to replace its chief executive with Enrique Lores, a former HP executive whose extensive experience managing once-dominant technology brands reportedly made him “the obvious man to oversee this particular situation.”
“We need to recommit to the fundamentals,” Lores recently told investors. “Specifically, we need to become a technology company again, which management was surprised to learn we had stopped being sometime around 2017.”
PayPal’s board has not formally responded to the offer and is expected to spend several weeks evaluating whether $53 billion adequately reflects the company’s strategic value, consumer reach, and enormous archive of emails beginning with “You sent a payment.”
Some analysts have called the bid a lowball offer, noting that PayPal processed approximately $1.8 trillion last year. Others countered that processing money and making money are technically different things, a distinction the financial technology sector hopes investors never fully understand.
The deal could also face regulatory scrutiny because it would consolidate an enormous portion of online payments under a single company. However, industry experts said regulators could ultimately approve the acquisition after Stripe checks a box confirming it is not a robot.
Private equity firm Advent International is expected to assist with financing and restructuring. People close to the negotiations said Advent’s role would include cutting costs, selling off unnecessary assets, raising fees, firing everyone who understands the legacy code, and eventually discovering that the entire PayPal platform is maintained by one 58-year-old engineer named Dennis who cannot be terminated because nobody else knows the password.
Stripe was founded in 2010 and became successful by making online payments relatively simple for merchants—a revolutionary concept that sent shock waves through PayPal, whose executives had previously believed checkout pages were supposed to feel like applying for a mortgage through a fax machine.
The potential merger would also reunite Stripe with members of the so-called PayPal Mafia, the group of early PayPal employees and investors who went on to dominate Silicon Valley, shape American politics, launch rockets, create surveillance platforms, and somehow make society nostalgic for the comparatively innocent era when tech companies merely wanted your credit card number.
Should PayPal reject the offer, Stripe and Advent could increase their bid, approach shareholders directly, or wait six months until PayPal unveils another “bold transformation plan” and becomes available for $38 billion.
At press time, PayPal shares had jumped 17 percent on news of the offer before declining slightly after investors were asked to log in to view their gains.