[jameskilton]

Stripe has been doing annual tender offers. Their stance on not being public yet is that they don't need to be, as an IPO is mainly a way to raise money.

As an ex-Stripe, I understand the sentiment, and the tender offers are a nice middle ground for now, but I still would like to see them go public eventually.

[tyre]

I hope they never go public (also as an ex-Stripe!)

I can't really see a net-positive benefit to having public shareholders and reporting requirements. Do we think Stripe's leadership needs feedback from random investment advisors or analysts? Do employees need the distraction of daily-updating stock prices? Would quarterly reporting incentivize better decision making?

In my opinion: ehhhhhhhhhhhh

I see the benefit, but if you're joining Stripe you know the trade-off of RSUs in a company that doesn't provide daily liquidity. They provide it on a regular basis, so you're not locked in forever (a la my 2014 Gusto shares).

[bryanlarsen]

I'm sure they already have more than the 500 non-accredited or 2000 accredited shareholder total that would trigger most of those reporting requirements anyways. So Stripe already has most of the drawbacks of being a public company without the benefits.

[kasey_junk]

The reporting isn’t the drawbacks of being public, it’s the investors.

They get to _choose_ who they let in if they are private (by definition).

They don’t need the public’s money and don’t want the headache of dealing with the public. I’d completely agree if I were them.

Disclaimer: ex-stripe who is still an investor.

[bryanlarsen]

The vast majority of public shareholders don't vote their shares. A VC is much more likely to apply unwanted pressure to the board/management than the general public is.

IMO, the best reason to avoid an IPO is to stay out of the media.

[overfeed]

The VC likely already has ownership, and a board seat - public companies are susceptible to activist-investors and hostile bids: outsiders who hold little/no stake, but an outsized influence.

[bryanlarsen]

Neither of which would be relevant in the Stripe case, because if Stripe IPO's they'll release a negligible number of shares. It'd be impossible for either group to amass a substantial number of shares.

[toomuchtodo]

Harder for activist investors to get into a private company than a public one imho. Keeps out those who would squeeze the business and bail, and potentially kick out the founders. With sufficient cashflow (which Stripe most certainly has), you can buy out existing investors without going public.

(not ex-Stripe, but own startup equity and have no problem with them never going public if that is the choice; optimize for the enterprise and existing stakeholders, not the public market mechanics broadly speaking)

[bryanlarsen]

You'd need to amass 50% of the shares to kick out the founders. That'd be impossible for a hostile party to do if Stripe IPO's because they wouldn't release anywhere close to that number of shares.

The only way to kick out the Collison's would be for the VC's to do it. They currently own 80%. It's easier for the VC's to do that if Stripe stays private than if Stripe IPO's.

[est31]

I'd say it has advantages and disadvantages.

One advantage is that whales can't play around with the stock price, say VCs dumping stocks at an unfortunate moment and putting pressure on the price. But it's also just wall street folks doing price manipulation for options schemes that can be an issue (it's illegal but has low enforcement if you are rich and well connected). Also lower chance of activist investors, and less of a quarterly pressure to show nice numbers, etc.

The advantage is also a disadvantage: minority shareholders of non-public companies have much less rights than those of public ones, and that includes employees. That's part of why you are dependent on the founder's goodwill on whether a startup exit can screw over rank and file employees or not. I'm not sure how much that danger is still out there if the company is doing tender offers, but it might still exist actually. Similarly, you can structure tender offers in a way that say former employees are disadvantaged, and many other arbitrary criteria.

Note that this depends greatly on the jurisdiction, e.g. in Germany there is legislation that's unfriendly to minority shareholders even for public companies, e.g. visible in the Varta takeover, imo part of why the idea of adding stocks to pensions will be ripe for money grabbing schemes of whales against the smaller owners.

Also employee of private company with tender offers, but not Stripe. Opinions my own.

[malfist]

Do very many companies provide daily liquidity? Most of my time getting RSUs have had trading windows, once a quarter if you're lucky.

[toast0]

When I was an employee of a subsidiary of Infospace, my RSUs were always worthless (honestly, I don't remember if any vested while I was there), at Yahoo, we could generally trade, although one shouldn't trade immediately after earnings, but I don't remember if this was enforced at the affiliated brokerage. At Facebook, I think it was typically a three week window every quarter.

Of course, if you quit, the windows are no longer in force, although if you have material non-public information, you're still not allowed to trade. Maybe there'a a share price where you'd rather quit and sell than hold on until the window opens.

[coffeemug]

Also ex-Stripe. This suggests an opportunity to build an exchange that addresses these problems. Could one build an exchange with deliberate "turn-based" liquidity to avoid the problem of daily stock price distraction, for example? (This is hard because there will always be secondary markets, but presumably this is already the case.)

[Rastonbury]

I get the feeling that the founders will not bend and invest for long term and not quarterly, as a non ex-stripe at least judging by their patience to IPO

[fnordpiglet]

The latest self funded tenders have been pretty tiny. I wouldn’t term it as “liquidity” as much as a symbolic gesture.

[tyre]

AFAIK none of the recent tenders have been self-funded. They’ve matched external investors who want shares with employees.

Also, not sure what you mean by "tiny". It's been billions of dollars.

[coldpie]

Going public is the fastest way to turn a solid, functioning business into a hideous, infinite-growth chasing ghoul that everyone hates. Don't do it.

[bryanlarsen]

Instead they are mostly owned by VC's, who will more directly pressure them to do that than the general public owners will.

The important part is that the Collison's control Stripe now. When that changes things may go down hill. It won't matter if it is public or not.

[WheatMillington]

As opposed to VC owners, who are famously satisfied with slow growth. Right?

[sensanaty]

And VCs are what, patient angels who invest their money out of the goodness of their hearts expecting no returns?

[maratc]

Above certain amount of shareholders, the rules for the public companies start applying, so you get all of the disadvantages of being a public company (like SEC filings, etc.) without the advantages (like ability to raise money.) IIRC this is what forced $MSFT to do IPO in 1986.

[adventured]

An IPO today is mainly a way for major investors - those that want out - to liquidate out in a big way by dumping to a very large mass of investors. There is no other means to do that without signaling a gigantic loss of confidence.

Raising money as a private entity is trivial these days if you're in the league that Stripe is. See: the comical AI private funding levels.

[hypeatei]

> An IPO today is mainly a way for major investors

Major investors and insiders. Stay the hell away from IPOs if you're not an institution getting access to shares at a reasonable price.

[giancarlostoro]

I'm glad. I don't think every company needs to be on the stock market, and companies that are profitable like Stripe is, absolutely do not need to be on the stock market. Why? So people can buy and sell their stock on a whim?

[johnny_canuck]

Are there caps on how much you could sell during the tender offer? I had one come through my email ~3 years ago for a company I previously worked for. IIRC it allowed you to sell up to 10% of your stock.

[armadyl]

> As an ex-Stripe, I understand the sentiment, and the tender offers are a nice middle ground for now, but I still would like to see them go public eventually.

This is an incredibly odd sentiment, imo. What’s the desire to see them go public unless you personally are profiting from it? Going public would quickly set Stripe on a pathway to potential enshittification and at minimum starting to squeeze the consumers and businesses it provides services to more.

[paxys]

If they are ex-Stripe they are likely holding shares, and so yes they would personally profit from going public.

[jez]

The tender offer announced in the article is open to former employees as well, so they personally profit regardless of Stripe being public (unless the claim is that by being public the valuation would be materially higher than the stated valuation for this offer).

[shevy-java]

There may be a conflict of interest with ex-Stripe folks wanting to see a move towards x or y.