Shopify Inc. has taken a significant stake in Stripe Inc., the payments giant it helped turn into Silicon Valley’s most valuable private company. Th

Shopify confirms significant investment in payment processor Stripe

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2021-06-15 00:00:07

Shopify Inc. has taken a significant stake in Stripe Inc., the payments giant it helped turn into Silicon Valley’s most valuable private company.

The Ottawa-based commerce software giant on Monday confirmed it has invested more than US$350-million in Stripe – its exclusive provider of payments processing services – over a series of investments. The investment was first reported Monday by the Wall Street Journal, citing unnamed sources.

Payments has been a key driver of Shopify’s success as it has grown into Canada’s most valuable company, providing a platform for more than 1.7 million merchants globally to run their digital stores and manage their operations.

The partnership has been a lucrative one for both companies, and expanded this year as Shopify introduced bank accounts and debit cards for merchants as part of a program with Stripe. “This is obviously a very deep partnership,” said former Shopify interim chief financial officer and adviser Mark MacLeod. “Stripe became the backbone of Shopify Pay from the inception. They’ve grown up together … Stripe probably powers half of Shopify’s revenue right now.”

Despite the mutual benefits, Shopify did miss out on the chance to invest in Stripe early on and book a significant return on investment as the U.S. company reached a valuation of US$95-billion during a fundraising round in March.