Plaid co-founders William Hockey and Zach Perret
Payments giant Visa is buying Silicon Valley start-up Plaid for $5.3 billion, the companies announced Monday.
Plaid is well-known among financial technology developers, but the average person interacting with it most likely wouldn’t recognize the name. Its API software lets fintech companies connect to users’ bank accounts. Its customers include popular peer-to-peer payment app Venmo, mobile investing app Robinhood and cryptocurrency exchanges Coinbase and Gemini.
The company raised a $250 million Series C funding round in 2018 that launched its valuation to $2.7 billion. Plaid also added widely followed venture capitalist Mary Meeker to the board. Venture arms of Citi, American Express, Google and Goldman Sachs have also made investments in the company.
As of December, Plaid said 25 percent of people in the United States with bank accounts have connected to the fintech company through an app.
Because of that network effect, Plaid has grown steadily with its list of customers. The company says it integrates with more than 10,000 banks and connects to roughly 20 million consumer accounts. While it does not give specific numbers or a full list of companies, Plaid said its customer base doubled from 2017 to 2018.
“We are extremely excited about our acquisition of Plaid and how it enhances the growth trajectory of our business,” Al Kelly, CEO and chairman of Visa, said in a statement. “Plaid is a leader in the fast growing fintech world with best-in-class capabilities and talent. The acquisition, combined with our many fintech efforts already underway, will position Visa to deliver even more value for developers, financial institutions and consumers.”