- Fidelity marked down the values of its shares in Stripe, according to its monthly report.
- Over the last year, Fidelity’s mutual fund has cut the value of its late-stage startup investments.
- Instacart has also taken a valuation hit from the asset manager, while Reddit’s has rebounded.
Silicon Valley just can’t catch a break.
Over the last year, Fidelity’s monthly filings have painted a dire picture of just how poorly startups have been faring since an investing peak in 2021, which was marked by an onslaught of VC funding and sky-high valuations.
Stripe, one of the biggest startups that was handsomely rewarded during this funding peak, has now lost its luster among investors, including Fidelity. The asset manager, which has invested in Stripe through its mutual fund, marked down the value of its Stripe investment by nearly 20% in February compared to the previous month, according to new data released by the mutual fund. Fidelity valued its shares of the fintech at $21.67 a piece, down from $26.87 at the beginning of the year. Even so, Stripe has occasionally seen month-over-month improvements, like in March 2022 and January 2023.
Fidelity has invested in recent funding rounds of Stripe and other high-profile startups via its $55 billion Growth Company Fund. The value it places on shares is one indicator of how companies are doing.
Since January 2022, Fidelity’s per-share valuation of Stripe has dropped by more than 40%. That time has been marked by various internal struggles at the fintech startup including layoffs in November. Earlier this month, Stripe announced it raised $6.5 billion at a $50 billion valuation — a steep drop from the $95 billion valuation it received when it last raised funding in early 2021. That capital will be used to provide liquidity to former and current employees, the company said.
Stripe did not respond to a request for comment.
The payment processor isn’t the only startup that has taken a beating over the last year in Fidelity’s rankings: The asset manager’s mutual fund has slashed its per-share value of grocery-delivery startup Instacart by around half in the last year, from just under $81 a pop in February 2022 to the current mark of $40 per share.
The Growth Company Fund’s per-share value in social-media giant Reddit, meanwhile, has rebounded 3.25% since a $36.90 low in May 2022.
Representatives for Instacart and Reddit did not immediately respond to requests for comment. A representative for Fidelity declined to comment.
Following a brutal month that saw the collapse of Silicon Valley Bank, a storied institution once revered by the tech community, and Signature Bank, which many crypto startups favored, this is just another setback for the tech industry and startups.
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