Visa has set a price that is twice as much as the company's latest valuation. Although Plaid has been steadily growing since 2013, the payment giant expects it to surge even more following the acquisition.
According to the press release, the transaction will not impact on Visa’s stock buyback program that was announced earlier nor the dividend policy.
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Plaid is reportedly one of the most popular softwares behind the fintech companies that allows start-ups to connect with their customers’ bank accounts. The list of firms that use Plaid, apart from payment app Venmo, includes mobile investing app Robinhood and crypto exchanges Coinbase and Gemini.
In 2018, Plaid raised $250m in a 2018 Series C funding round. Following the move, the company's market valuation rose to $2.7bn.
Visa and MasterCard were among those who invested in Plaid at an early stage, along with Citi, American Express, and Goldman Sachs. The latter was reportedly an exclusive advisor during the acquisition.
In December 2019, Plaid revealed that each one in four people in the US who have banking accounts are connecting some fintech company through an app.