Sequoia Capital to Earn $100M From Stripe’s $1.1B Acquisition of Bridge

Venture capital firm Sequoia Capital is poised to earn approximately $100 million following Stripe's acquisition of Bridge for $1.1 billion. This notable return is especially significant in the crypto sector, which has seen a considerable decline in venture funding since its peak in 2022.

Other Investors Set for Major Returns

Reports indicate that Sequoia invested $19 million in Bridge during its Series A funding round less than a year ago, translating to a 16% ownership stake in the stablecoin platform.

• If liquidated, this stake could yield a windfall of $100 million.
• Other investors, including Ribbit Capital, Bedrock Fund Management, Index Ventures, and Haun Ventures, also stand to gain significantly from the acquisition.

Stripe announced its finalized bid for Bridge on October 20, 2024. The platform, co-founded by Sean Yu and Zach Abrams, provides software tools for businesses to process payments in stablecoins. However, the transaction is pending regulatory approval and is expected to close in the coming months.

Stripe's Commitment to Stablecoins

The acquisition comes just six months after Stripe co-founder John Collison promised to support stablecoins by mid-2024. This deal ranks among the largest in the crypto sector to date.

Crypto Venture Funding Trends

Despite Sequoia's success, the broader crypto venture funding landscape is facing challenges. According to a report from Galaxy Digital, crypto venture funding fell by 20% in Q3 2024, totaling $2.4 billion.

• The report noted a 17% decrease in deals, with only 478 reported during that period.
• Analysts attributed the downturn to a "barbell market" where investors are focusing on high-profile cryptocurrencies and high-risk meme coins, often neglecting mid-sized projects.

Despite the funding decline, Stripe's interest in Bridge was reportedly driven by the platform's growth, which saw it reach a $14 million run rate recently.Sequoia Capital's expected earnings from Stripe's acquisition of Bridge highlight the potential for significant returns in the crypto sector, even amid a challenging funding environment.