Plaid has successfully raised $575 million in a secondary share sale, which has led to a significant valuation adjustment from $13.4 billion in 2021 to $6.1 billion today.
The funding round saw participation from notable investors including Ribbit Capital, NEA, Fidelity Management & Research Co., BlackRock, and Franklin Templeton. This capital infusion will allow some Plaid employees to liquidate restricted stock options that are set to expire at the end of 2025.
CEO Zach Perret shared with CNBC that the company has experienced “substantial” growth over the past year, attributing the valuation decline to overall market conditions. Perret emphasized, “The reality is our business is much stronger, and our revenue has grown quite substantially. While our profitability has improved significantly, we are still influenced by market multiples, as many companies in the industry are.”
He also mentioned that although an IPO remains a prospective goal, the company recognizes the need for further internal development before proceeding. “We still have a lot of internal work to do. We’re not ready, which is why we didn’t consider it right now,” Perret stated.
Founded in 2012, Plaid specializes in connecting consumers’ financial accounts across more than 12,000 providers to over 8,000 fintech companies. The firm’s valuation reached $13.5 billion in 2021, shortly after it abandoned a $5.3 billion acquisition deal with Visa, which was halted by the U.S. Justice Department over antitrust concerns.