The Financial Times reported today that fintech startup Checkout.com has reduced its internal valuation to $11 billion, a significant drop from the $40 billion valuation it reached just under a year ago. This development has sparked interest among industry observers and investors alike.
What Does It Mean for the Company?
However, it’s essential to understand that this reduction in valuation doesn’t necessarily mean what you might think. In Checkout.com’s case, the company wasn’t in the process of raising a new funding round. Unlike Klarna’s down round, the new valuation wasn’t determined by a VC firm willing to invest in the company.
Checkout.com: A Full-Stack Payments Company
Checkout.com is building a full-stack payments company that acts as a gateway, acquirer, risk engine, and payment processor. The company allows users to process payments directly on their site or app, as well as rely on hosted payment pages, create payment links, and more. It supports various payment methods, including card payments, Apple Pay, Google Pay, PayPal, Alipay, bank transfers, SEPA direct debits, and payouts.
Private Company Valuations: Imperfect Metrics
It’s challenging to determine the value of a private company like Checkout.com. The post-money valuation has been used as a metric for startups to compare their size with that of their direct competitors. However, this metric is imperfect due to various factors:
- Companies don’t raise money at the same time: Each company’s fundraising process is unique, making it difficult to establish a fair comparison.
- Lack of transparency: Private companies often keep their financial information private, making it hard for investors and analysts to assess their value accurately.
Romain Dillet: Tech Journalist with a Deep Understanding
As we delve into the world of fintech and startup valuations, it’s essential to appreciate the expertise of Romain Dillet, a renowned tech journalist. With 12 years of experience at TechCrunch, Romain has established himself as one of the most knowledgeable tech journalists in the industry.
Romain’s background in computer science and his extensive knowledge of the tech industry enable him to provide insightful coverage of fintech companies like Checkout.com. His ability to connect the dots between innovations and their impact on society is unparalleled.
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Additional Reading
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Stay informed about the ever-evolving world of fintech and startups with TechCrunch’s comprehensive coverage.
