On the morning of January 14, Beijing time, Visa announced today that it will buy Financial Services API startup Plaid for $5.3 billion. Plaid specializes in developing financial services APIs. This is similar to Stripe’s approach to payments, but rather to facilitate payments, but to make it easier for developers to share banking and other financial information. For a company like Visa, this service makes sense.
The startup bought Quovo two years ago to break through banking and expand into the wider financial services and investment sector. The idea is to provide a more comprehensive platform for financial service providers. The company’s founder said at the time: “Historically, financial applications have used Plaid primarily to interact with checks and savings accounts. When we acquired Quovo, we were expanding our capabilities to a wider range of asset classes. “
The deal is expected to close within the next three to six months, pending regulatory approval.
According to Crunchbase, Plaid’s exit price is a big win for its investors, who have invested a total of $353.3 million in the company. The most important of these is a $250 million investment at the end of 2018. Index Ventures and KPCB led the round of financing, when Plaid was valued at $2.65bn, about half the final purchase price.
It later emerged that MasterCard and Visa had also participated in the round of financing.