Plaid, a company specializing in connecting bank accounts to financial applications, is reportedly working with Goldman Sachs (NYSE: GS) on a tender offer. This deal aims to enable early-stage investors and employees to sell existing shares, potentially raising between $300 million and $400 million, according to sources cited by Bloomberg. The tender offer will likely result in a lower valuation for the Fintech company compared to its previous financing round.
In April 2021, Plaid had reportedly secured a substantial $425 million Series D funding round, which was led by Altimeter Capital, at a post-money valuation of $13.4 billion. However, the Fintech industry has experienced a shift in valuations since then, primarily due to significantly higher interest rates. This market adjustment has led to lower valuations for many Fintech startups, including Plaid.
Initially, Plaid focused on serving Fintech clients, but its customer base has expanded to include established financial companies such as H&R Block, Western Union, and Citi.
Despite the valuation adjustments, Plaid’s revenue has continued to grow, with a reported increase of more than 25% in 2024, according to Bloomberg.
The collaboration with Goldman Sachs on the tender offer will provide early investors and some employees with an element of liquidity without pursuing a public offering.
The liquidity provided could set a precedent for similar transactions as Fintechs dodge an IPO but allow some investors to exit part or all of their holdings.
As covered last month, Fintech Plaid plans to hire more staff in 2025 while adding office space.
Plaid CEO and cofounder Zach Perret said that you may think of the company as the “plumbing that connects banks to the app and the app to the banks.”
Plaid has offices in London. San Francisco. New York and Amsterdam. Soon, Plaid intends to establish an office in the Raleigh-Durham Triangle.
Established in 2013, Plaid is an open banking enabler that allows users to link their banking accounts with apps such as Venmo, CashApp, and other services.