From $9B to $3.5B: Rapyd’s Valuation Rollercoaster

Rapyd Financial Network, the London-based global payments powerhouse, is gearing up to raise $300 million in a new funding round. But here’s the kicker: the company’s valuation has taken a nosedive to $3.5 billion—a far cry from its $9 billion peak in 2021. According to Bloomberg, this marks a significant shift in the fintech landscape, where even giants are feeling the heat.

What Does Rapyd Do?

Rapyd isn’t just another fintech player. It’s a global payments platform that offers a suite of financial services, including:

• Payments processing
• Mobile wallets
• Money transfers
• Card issuing
• Fraud protection

All of these services are accessible to third parties via a sleek API, making Rapyd a go-to for businesses looking to streamline their financial operations.

Acquisition Spree: Rapyd’s Growth Strategy

Rapyd isn’t just sitting back. The company has been on an acquisition rampage, snapping up four companies in recent years. Highlights include:

• Valitor: A $100 million acquisition of the Iceland-based payments startup in 2022.
• PayU: A whopping $610 million deal for units of the global payments platform in 2023.

Now, Rapyd plans to use the new funding to acquire yet another payment processing startup. Talk about doubling down!

The Down Round Reality

Rapyd isn’t alone in this valuation dip. The fintech world is seeing a wave of down rounds, where companies raise capital at lower valuations than their previous highs. Why? The VC funding frenzy of 2020 and 2021 inflated valuations to unsustainable levels. Now, the market is correcting itself.

“Flat or down rounds hit a decade high, making up 27% of all deals in the first nine months of 2024.”

PitchBook Data

Even Rapyd’s competitor, Stripe, faced a similar fate, raising capital at a $50 billion valuation—down from its $95 billion peak.

What’s Next for Rapyd?

In 2023, Rapyd CEO and co-founder Arik Shtilman hinted at closing a $700 million financing round. But here’s the twist: the company never publicly confirmed whether the round was completed or at what valuation. This new $300 million raise could be a strategic pivot to stabilize the ship.

Who’s Backing Rapyd?

Rapyd’s investor lineup reads like a who’s who of the VC world, including:

• Coatue
• Oak HC/FT
• Target Global
• Tiger Global Management

Despite the valuation drop, these heavyweights are still betting on Rapyd’s future.

The Bigger Picture

Rapyd’s story is a microcosm of the broader fintech ecosystem. The days of sky-high valuations are over, and companies are now focused on sustainable growth. For Rapyd, this funding round could be a chance to reset, refocus, and emerge stronger.

As the fintech world watches closely, one thing is clear: Rapyd isn’t backing down. It’s adapting, evolving, and fighting to stay ahead in a fiercely competitive market.