Checkout.com Cuts Internal Valuation to $11B

Payments platform Checkout.com has reportedly reduced its internal tax valuation to around $11 billion.

The reduction at the London-based company, as reported by the Financial Times Tuesday (Dec. 13), comes as a number of high-value publicly owned and private startups are seeing their valuations drop as investor sentiment cools.

Sources tell the Financial Times that Checkout.com informed its staff of the reduction in November, while also lowering the price at which employees can exercise stock options from $252 per share to $65.

In a statement issued to PYMNTS, the company said it had told staff it will “align equity awards to an updated tax valuation that reflects the current macroeconomic conditions.”

“This gives our employees the opportunity to share more meaningfully in the potential economic upside as we continue to grow our business,” the company said. “We are focused on building and scaling a generation-defining business that enables global brands and their communities to thrive in the digital economy.”

A company spokesperson declined to share Checkout.com’s prior internal tax valuation.

The reduction in internal price, different from the valuation decided by investors, helps employees by lowering the cost of their equity in the company. This year has seen other companies make similar moves.

The payments company Stripe reduced its internal valuation by 28% in June, while Instacart has lowered its valuation three times this year.

Checkout.com, which processes payments for customers that include Sony, Patreon and Pizza Hut, has collaborated with PYMNTS for a number of our reports.

The company was valued by investors at $40 billion in January after raising $1 billion in a Series D funding round from investors that included Tiger Global.

Since then, Europe’s tech sector has seen a drastic reduction in value — to the tune of $400 billion, as PYMNTS noted last week.

A report by the London-based venture capital (VC) firm Atomico found that the total value of public and private tech companies in Europe fell from $3.1 trillion late last year to $2.7 trillion.

The reasons for this drop include increased interest rates and the Russia-Ukraine war, the report said, with venture capital funding in the sector falling 18%. Atomico also found that 82% of founders surveyed had more trouble raising venture capital than they did 12 months ago.