Stripe paid €9m for Irish start-up Touchtech

Revenue at Collison brothers’ firm grew 51pc in Europe and Asia before the pandemic

Stripe Inc. co-founders John Collison and Patrick Collison. Photo: Bloomberg/David Paul Morris

Adrian Weckler Twitter Email

May 03 2021 02:30 AM

Stripe's revenue grew 51pc in Europe and Asia before the Covid-19 outbreak saw the payment firm triple in value, according to the company’s latest accounts.

The filing also reveals that the ecommerce giant, founded by Limerick brothers Patrick and John Collison, paid $10.8m (€9m) for the Irish secure payments startup Touchtech in 2019. Stripe’s own soaring valuation since then means the Touchtech sellers’ payment could be worth three times the initial price, if they have held onto their shares.

Stripe, now Silicon Valley’s biggest ever private company with a valuation of $95bn (€79bn), saw an increase in turnover in Europe and Asia from $529m to $800m in 2019.

Stripe International also recorded an after-tax profit of $39m for the first time, compared to a loss of $24m the year before, because of a one-off internal group IP transfer worth $150m.

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The accounts also show that the Collisons transferred all of Stripe’s international intellectual property to Ireland in 2019, the year it established Dublin as its international headquarters, in a transfer valued at $10.95bn.

Since then, CEO Patrick Collison has described Stripe as an “Irish American” company with an increasing number of leadership executive roles based in Dublin, where more than 300 people work.

In March, Stripe announced that it would add “at least” 1,000 jobs in Dublin over the next five years.

Co-founder John Collison said that Europe, which is Stripe’s second largest market behind the US, is a growing percentage of Stripe’s business and that expansion here is one of the reasons Stripe raised a fresh $600m round in private funding this year.

The €9m Irish Touchtech acquisition in 2019 may have left co-founders Shekinah Adewumi and Joseph Kuye in a better financial position than the underlying takeover figure implies, as the accounts suggest it was an all-share deal. Stripe’s value has increased threefold since 2019.

The 2019 accounts show that Stripe International, which says that it is tax resident in Bermuda, paid a cumulative €7.7m in tax in its non-US international markets, from Ireland and the UK to Singapore, Hong Kong and Australia. The accounts do not say how much was paid to Irish authorities.

Wages and salaries at the company more than doubled to €50.3m in 2019. Its international headcount went from 195 to 365 over the period. Most of the increase in headcount was in engineering, which more than quadrupled to 94, while sales jobs rose from 65 to 84.

The accounts also show a cash pile of $536m while Stripe International’s cost of sales rose from $455m to $699m in the same period.

Despite the accounts being 18 months old, they will likely be of interest to potential investors, with Stripe at the centre of speculation over an IPO this year or next.

The company is believed to be one of the big gainers of the Covid pandemic as more people defaulted to online payments for everyday goods and services.

Last week, Stripe acquired the US sales and tax technology firm TaxJar. It also announced the roll-out of a card-issuing service for businesses in 20 European countries, including Ireland.