Bitpay pioneered the use of cryptocurrencies as one of the first Bitcoin payment processors. The company is the oldest and largest provider of Bitcoin and crypto payment services today. Its vibrant history includes jump-starting the crypto merchant economy, working with regulators to make blockchain assets safer, and overcoming a $1.8M phishing attack.
BitPay’s success stems from a combination of innovation, perseverance, and a desire to integrate crypto payments into daily life. Today, Bitpay accepts +100 cryptocurrencies and has completed +$5B in payments.
All of these factors have made Bitpay a well-established and respected firm whose shares remain in high demand. However, Bitpay is privately owned, meaning that you can’t purchase shares from a broker without qualifying. Here’s how to navigate the secondary markets to acquire Pre-IPO shares of Bitpay.
What is Bitpay?
Bitpay entered the market in May 2011 as one of the first Bitcoin payment processors. Its founders, Tony Gallippi and Stephen Pair, launched the company in Orlando. Shortly after, it moved to Atlanta as its operations and client base expanded. Today, Bitpay has offices located in New York City, San Francisco, St. Petersburg, Amsterdam, and Argentina. It has processed billions of transactions and remains pivotal in the crypto market due to its features and positioning.
Source – Bitpay
Bitpay’s payment processing features enabled merchants to easily accept Bitcoin and other cryptocurrencies, regardless of their technical understanding. It provides a straightforward interface that streamlines the core options merchants use. Additionally, the company was able to overcome merchants’ concerns thanks to its unique features, which include the ability to accept payments in multiple cryptocurrencies and have them automatically converted to USD to prevent losses from volatility.
BitPay Early Days
The early days saw Bitpay secure a high-level partnership with WordPress, one of the largest website hosting companies in the world. Shortly after, the company reached the 10k merchant milestone. In 2013, Bitpay demonstrated its innovative spirit with the release of the Bitpay Visa Debit Card.
Notably, this was the first crypto debit card to be accepted anywhere VISA was in the US. The project was briefly replaced with a reloadable Mastercard that supported 14 cryptocurrencies and stablecoins.
Currently, the company offers direct gift card purchase options alongside some other cool features like bill pay. The bill pay option enables crypto users to cover their monthly expenses, like light and cell phone bills, using blockchain assets. To accomplish this task, the feature converts your crypto to fiat currency before making the payment directly to the provider. The process was designed to operate in a streamlined and seamless fashion, with the technical aspects all handled in the background.
Bitpay continued to drive adoption via its features and services. In 2018, it secured a virtual currency license from the New York Department of Financial Services. This maneuver enabled the company to expand its offerings and cemented its validity in the space. Users could now access a secure, open-source, non-custodial wallet that connected directly to the best features. Other updated features include the ability to convert tokens directly from the wallet or buy crypto with credit/debit cards.
Historical Funding Rounds
Summary of Bitpay Funding:
Total Funding: Bitpay secured $103M across 6 funding rounds.
Largest Round: Bitpay’s largest funding round secured $40M in April 2018.
Investors: A total of 31 institutional investors and 6 Angel investors back Bitpay.
Latest Round: The latest funding round raised $40M and was a Series B round held on April 02, 2018.
Funding Rounds Breakdown:
Key Investors:
Bitpay secured funding from Aquiline Capital Partners, Index Ventures, A-Grade Investments, Founders Fund, Menlo Ventures, and more.
Why Invest in Bitpay?
There are many reasons why investing in Bitpay could be a good fit for your portfolio. For one, the company has been in operation since the early days of blockchain adoption. It has completed +$5B in transactions over +11 years of service. Additionally, it remained active during the many crypto winters and times of uncertainty that the market experienced. Now, its history and willingness to innovate make it more valuable than ever.
Bitpay is Easy to Use
Bitpay has seen crypto applications go from coding windows to user-friendly interfaces. The company has been there the entire time, updating its features and services to eliminate any technical roadblocks to adoption. It’s helped streamline key payment features such as QR codes and payment links, which have made it easier for new users to join the blockchain sector.
Bitpay is Flexible
Bitpay offers a flexible array of features that can be customized to meet nearly any merchant’s needs. It supports popular projects like Bitcoin, Ethereum, Polygon, Litecoin, Dogecoin, XRP, alongside thousands of ERC-20 tokens. The Dapp also supports a variety of fiat currencies and can integrate into most wallets.
Community Support
Bitpay’s influence hasn’t been limited to the crypto market. The company regularly donates to charities, political campaigns, and special events. For example, the firm sponsored the St. Petersburg Bowl college football game. This commitment to support community activities helps to showcase the positive impact that blockchain assets can have on the world.
Partnerships
The number of high-level clientele and partnerships that Bitpay has makes it a valuable resource in the market. The company has strategic partnerships with Shopify, Intel, Microsoft Azure, and lots of other industry-leading brands. Additionally, it has been part of some pioneering startup projects like BitCore and Copay.
Funding and Investor data sourced from Tracxn
1. Pre-IPO Secondary Marketplace
Secondary markets are purpose-built exchanges that connect pre-IPO shareholders with potential investors. These marketplaces can offer these assets because they work closely with employees, early-stage investors, and venture capitalists, who are crucial to the company’s pre-IPO growth.
Investing in pre-IPO shares of Bitpay could offer strong returns if the company’s valuation increases following its IPO. It’s common for company valuations to increase following an IPO. As such, it makes sense to add pre-IPO shares to your portfolio before the firm announces plans to go public.
Secondary marketplaces have many requirements. Here are some concerns you should be made aware of:
Eligibility: This approach requires you to be an accredited investor, meaning you will have to show at least $1M in liquid assets to qualify for access.
2. Private Equity Firms
Private equity firms gain access to pre-IPO shares during investment rounds. They then offer these shares to high-net-worth accredited investors with a commission. Notably, private equity firms are known to have extra stipulations, including blocking the sale of shares for years in some cases.
3. Employee Equity Sales
Many consider employee equity sales as the best way to acquire pre-IPO shares in Bitpay. This method of acquiring pre-IPO shares requires you to connect with former employees. It’s common for companies to issue shares as part of an incentive package. Notably, this profit-sharing method has become more popular, leading to more pre-IPO share opportunities for investors.
Private Transactions: There are a lot of hoops you will need to jump through to complete a private pre-IPO transaction, including creating specific legal agreements, conducting valuations, and setting in place any limitations on the transfer of the asset.
Brokerage: Brokers will take a lot of the confusion out of the pre-IPO process. These professionals can guide you through each step, ensuring full compliance and avoiding common errors untrained professionals make.
There are several risks that you should consider before jumping into the pre-IPO shares investment arena. Here are the top concerns:
Liquidity Risk
If you are looking for an asset that you can sell right away, pre-IPO shares are not the best option.
These investments can include sales and transfer clauses that prevent the transfer of the asset until certain criteria, such as the IPO’s completion, are met. It’s even common for pre-IPO shares to require you to wait years before gaining the ability to sell your assets.
Finding a Broker
If you meet the requirements and are comfortable with the risks, several platforms offer access to pre-IPO opportunities:
Forge Global: One of the largest private stock marketplaces, offering shares in late-stage startups like SpaceX, Stripe, and Databricks. Minimums typically start around $100,000.
EquityZen: A popular platform allowing accredited investors to buy into private companies with minimums as low as $5,000. Past offerings include companies like Discord and UiPath.
Rainmaker Securities: A full-service broker that helps source and negotiate private share sales, including opportunities in companies like OpenAI, Stripe, and Palantir.
Hiive: A newer platform with live bid/ask pricing for hundreds of private companies. Transparent and low-fee, with minimums starting around $25,000.
MicroVentures: Offers pooled access to late-stage companies through special purpose vehicles (SPVs), including past investments in SpaceX and Instacart.
EquityBee: Allows investors to fund employee stock option exercises at startups, often at discounted valuations, with minimums around $10,000.
Augment: A digital-first marketplace showing real-time pricing for pre-IPO shares, targeting tech-savvy investors and offering lower transaction fees.
StartEngine Private: Launched in late 2023, this platform offers accredited investors access to Regulation D offerings in later-stage, venture-backed companies. In its first nine months, it generated $16.5 million in revenue, with average investments around $32,000
Important: Always perform thorough due diligence and consult a financial advisor before investing in private company shares.
Valuation of Bitpay and Future IPO
Bitpay is one of the most well-known and established blockchain companies in the world. It’s a prime example of how a startup that’s not scared to think outside the box can grow into a global leader. Bitpay’s post-money valuation held on Sep 16, 2019, ranged from $100M to $ 500M. The company earned this value by staying focused on its goal to make crypto payments safe, accessible, and easy to understand.
Bitpay has seen significant growth and secured more investor support since that time. Despite no official announcement regarding hosting an IPO, there are many analysts who believe the company could do so shortly. They cite factors like strong institutional investor support and public awareness surrounding blockchain assets. Additionally, the company’s positioning and partnerships could give it added momentum during the IPO process.
Given Bitpay’s top spot and proven track record, many believe it could host one of the largest blockchain-centric IPOs to date. Consequently, investors who qualify for these assets could capitalize on future growth within the blockchain sector or any hype surrounding the company’s IPO.
Investing in Bitpay Pre-IPO Shares: Conclusion
Investing in Bitpay Pre-IPO shares opens the door for future windfalls. The company remains a crucial component of the blockchain economy and has helped introduce its benefits to the masses. All of these factors could equal long-term growth. However, there are significant risks associated with any pre-IPO investments.
You should always consult a blockchain professional whenever dealing with pre-IPO shares. These assets have extra restrictions and requirements. For those who do their research and find they qualify for Bitpay Pre-IPO shares, there’s a chance that they will see rewards for their forward thinking.
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Disclaimer: This article is for informational purposes only and does not constitute financial, legal, or investment advice. Pre-IPO shares are typically available only to accredited investors and carry significant risk. Always perform thorough due diligence and consult a financial advisor or legal expert before making investment decisions.