Visa to buy plaid for $5.3 billion in bid to reach startups
Visa has agreed to buy Plaid Inc. in a $5.3 billion deal that seeks to diversify the payments giant by improving access to financial startups.
The deal is expected to close in the next three to six months, Visa said in a statement Monday. The purchase price is double Plaid’s $2.65 billion valuation in a 2018 funding round.
Plaid makes developer tools that help power a range of popular financial apps, including Venmo, Coinbase and Acorns Grow It provides the pipes that startups use to offer banking data inside their apps and websites. Founded in 2012, Plaid has attracted investments from Goldman Sachs Group and venture capitalist Mary Meeker.
Plaid previously held talks with Jack Dorsey’s Square about an acquisition that would have valued Plaid at about $1 billion. In early 2019, the firm announced that it was buying one of its competitors, Quovo, in a deal valued at about $200 million.
Both Visa and Mastercard Inc. have been seeking to move beyond card payments in recent years to fuel their rapid revenue growth. Mastercard bought a payments platform owned by Nets for $3.2 billion last year, using its biggest-ever acquisition to move further into so-called account-to-account payments.
The announcement included comments from executives at JPMorgan Chase and PayPal Holdings. Plaid has struck data-sharing agreements with major banks including JPMorgan and Wells Fargo over the past few years, seeking to head off battles over whether consumers could give up their bank username and password to share data with financial applications.