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> The funds raised will be used to provide liquidity to current and former employees and address employee withholding tax obligations related to equity awards,

> The funds raised will be used to provide liquidity to current and former employees and address employee withholding tax obligations related to equity awards, resulting in the retirement of Stripe shares that will offset the issuance of new shares to Series I investors. *Stripe does not need this capital to run its business.* It’s the second paragraph of the OP

thgirhet 4y ago
[flagged]
tamade 4y ago
That last sentence is corporate PR spin. They very much need this capital to run the business, ie, they didn't have enough money to pay taxes.
- zaroth 4y ago
  They aren’t raising the money to pay corporate taxes. They are doing this so their employees can pay taxes on otherwise illiquid shares (i.e. taxes the employees can’t afford).
  - gmd63 4y ago
    Isn't managing employee satisfaction part of running a business?
    - zaroth 4y ago
      Everything that Stripe does is part of running their business, that’s just a tautology.
- camjw 4y ago
  They could have just let employee options expire and then they wouldn't have had the tax bill. Though, I imagine recruitment would become a bit harder then.
- jeremyjh 4y ago
  They didn’t have enough to pay their employee’s taxes on unrealized gains.
HDThoreaun 4y ago
If paying your employees in stock with no plan to IPO is how you run your business then you do in fact need capital to pay taxes on that stock in order to keep your employees.
serial_dev 4y ago
Well, don't they, though? The way I understand it is that if they wouldn't have this round, lots of very valuable, tenured employees would be f-ed over, which could cause them to leave on very bad terms and a PR nightmare that could make attracting workers hard.
- zaroth 4y ago
  No, they don’t. There’s an appreciable difference between a company selling newly issues shares to fund their corporate expenses, and arranging a liquidity event for your employees. That’s what they are explaining in that paragraph. Obviously it can be very much in their interest to do this, while it is still also true that “Stripe does not need this capital to run its business.”

thgirhet 4y ago

[flagged]

tamade 4y ago

That last sentence is corporate PR spin. They very much need this capital to run the business, ie, they didn't have enough money to pay taxes.

zaroth 4y ago
They aren’t raising the money to pay corporate taxes. They are doing this so their employees can pay taxes on otherwise illiquid shares (i.e. taxes the employees can’t afford).
- gmd63 4y ago
  Isn't managing employee satisfaction part of running a business?
  - zaroth 4y ago
    Everything that Stripe does is part of running their business, that’s just a tautology.
camjw 4y ago
They could have just let employee options expire and then they wouldn't have had the tax bill. Though, I imagine recruitment would become a bit harder then.
jeremyjh 4y ago
They didn’t have enough to pay their employee’s taxes on unrealized gains.

HDThoreaun 4y ago

If paying your employees in stock with no plan to IPO is how you run your business then you do in fact need capital to pay taxes on that stock in order to keep your employees.

serial_dev 4y ago

Well, don't they, though? The way I understand it is that if they wouldn't have this round, lots of very valuable, tenured employees would be f-ed over, which could cause them to leave on very bad terms and a PR nightmare that could make attracting workers hard.

zaroth 4y ago
No, they don’t. There’s an appreciable difference between a company selling newly issues shares to fund their corporate expenses, and arranging a liquidity event for your employees. That’s what they are explaining in that paragraph. Obviously it can be very much in their interest to do this, while it is still also true that “Stripe does not need this capital to run its business.”