Plaid (company)

Plaid is a financial services company based in San Francisco, California. The company builds a data transfer network that powers fintech and digital finance products.

Plaid Inc.
Private
IndustryFinancial technology, Financial Services
FoundedMay 2013 (2013-05)
FoundersZach Perret
William Hockey
Headquarters
San Francisco, California
Number of locations
7 countries (US, Canada, UK, France, Spain, Ireland, Netherlands)
Key people
ProductsTransactions, Auth, Balance, Identity, Income, Assets, Investments, Liabilities
ParentVisa Inc. (pending)
Websiteplaid.com

The company builds a technology platform, which enables applications to connect with users’ bank accounts.[1] Plaid focuses on enabling consumers and businesses to interact with their bank accounts, check balances, and make payments through financial technology applications.[2] The company operates in the U.S., Canada, the UK, France, Spain, Ireland, and the Netherlands.[3]

On January 13, 2020, Visa announced that it was acquiring Plaid for $5.3 billion.[4]

History

Plaid was founded in 2013 by Zach Perret and William Hockey.[5] The pair originally attempted to build consumer financial management products, including budgeting and bookkeeping software.[6] When confronted with difficulties in connecting bank accounts required for these tools, they decided to pivot their core business focus to a unified banking API.[7]

Funding

The company raised a $2.8M seed round from Spark Capital, Google Ventures, and New Enterprise Associates in late 2013. In 2014, they raised $12.5M from New Enterprise Associates.

On December 11, 2018, the company announced a $250 million Series C round with a valuation of $2.65 billion. The funding round was led by Mary Meeker, with Andreessen Horowitz and Index Ventures joining as new investors. Former backers Goldman Sachs, NEA and Spark Capital also participated.[8] It was later revealed by Plaid that both Visa and Mastercard invested in the round.[9]

Round Date Lead Investor Amount Raised Valuation
Seed Sept 19, 2013 Spark Capital $2.8M --
Series A Nov 15, 2014 New Enterprise Associates $12.5M --
Series B Jun 19, 2016 Goldman Sachs Investment Partners $44M --
Series C Dec 11, 2018 Mary Meeker, Index Ventures, Andreessen Horowitz $250M $2.65B

Acquisition

In January 2019, Plaid acquired competitor Quovo for $200 million.[10]

On January 13, 2020, Plaid announced that it had signed a definitive agreement to be acquired by Visa for $5.3 billion dollars.[11][12] The deal is double the company’s most recent Series C round valuation of $2.65 billion,[13] and is expected to close in the next 3-6 months, subject to regulatory review and closing conditions. According to the deal, Visa would pay $4.9 billion in cash and approximately $400 million of retention equity and deferred equity,[14][15] according to a presentation deck prepared by Visa.[16]

gollark: Or it got stuck in a local maximum, which happens a lot.
gollark: For biology, it's just really complicated, because of being run through ruthless optimization processes for billions of years.
gollark: For encryption you run your data through a transform which makes it basically impossible to get the original data back out again without some other data (the key).
gollark: Encryption, I mean.
gollark: No, that's totally different and unrelated.

References
  1. "Plaid – Press". plaid.com. Retrieved 2017-05-31.
  2. "6 Fintechs Disrupting The Industry". Inc.com. 2017-01-26. Retrieved 2017-05-31.
  3. ""Every company is a fintech company"". Fortune. Retrieved 2020-03-22.
  4. Andriotis, Cara Lombardo and AnnaMaria (2020-01-14). "Visa to Pay $5.3 Billion for Fintech Startup". Wall Street Journal. ISSN 0099-9660. Retrieved 2020-01-28.
  5. "Fresh off a $2.65B valuation, Plaid co-founder William Hockey is leaving". TechCrunch. Retrieved 2020-03-22.
  6. Velazco, Chris. "Rambler Takes Home The Disrupt NY 2013 Hackathon Grand Prize, Learn To Drive And Radical Are Runners Up | TechCrunch". Retrieved 2017-05-31.
  7. Ha, Anthony. "Plaid Raises $2.8M To Make Banking Data More Developer Friendly | TechCrunch". Retrieved 2017-05-31.
  8. Rooney, Kate (2018-12-11). "Plaid's $250 million funding round propels it to $2.7 billion valuation". www.cnbc.com. Retrieved 2018-12-12.
  9. "Plaid announces strategic investment from Mastercard and Visa". TechCrunch. Retrieved 2020-03-22.
  10. Tesfaye, Mekebeb. "Plaid snags API competitor Quovo for $200 million". Business Insider. Retrieved 2020-01-25.
  11. "Visa is acquiring Plaid for $5.3 billion, 2x its final private valuation". TechCrunch. Retrieved 2020-01-13.
  12. "With Plaid Acquisition, Visa Makes A Big Play for the 'Plumbing' That Connects the Fintech World". Fortune. Retrieved 2020-01-28.
  13. "What Plaid's $5.3 Billion Acquisition Means For The Future Of Fintech And Open Banking". finance.yahoo.com. Retrieved 2020-03-22.
  14. Demos, Telis (2020-01-14). "Visa's Bet on Plaid Is Costly but Necessary". Wall Street Journal. ISSN 0099-9660. Retrieved 2020-03-22.
  15. "Payments giant Visa acquiring crypto-serving fintech firm, Plaid". Invezz. 2020-01-14. Retrieved 2020-03-22.
  16. "Visa to acquire crypto-serving fintech unicorn Plaid for $5.3B". finance.yahoo.com. Retrieved 2020-03-22.
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