Stripe acquires TaxJar in multimillion dollar deal

Online payments company Stripe has acquired TaxJar, a leading provider of sales tax software for internet businesses in a multmillion dollar deal.

No financial details of the deal have been publicly disclosed but TaxJar had a post-market evaluation of $179 million (€148 million) in 2019, according to Pitchbook.

The deal comes just a day after Stripe once again participated in a funding round for Step, a US mobile banking start-up aimed at teenagers, and was named among Time's 100 most influential companies.

Stripe said TaxJar will help internet businesses comply with an ever-growing list of sales tax requirements. It said alongside its Billing and Radar products that TaxJar will “become a pillar of Stripe’s revenue platform.”

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Headquartered in Woburn, Massachusetts, TaxJar is a developer of a cloud-based sales tax automation platform designed to manage tax easily. The company’s platform offers a multi-channel reporting feature that organises sales tax data into return-ready reports, enabling businesses to automatically file sales tax returns in any US state. The company had raised over $60 million in venture funding prior to the sale.

Stripe said that one of the top requests from its users over the past five years has been for assistance in navigating sales tax, particularly in the US which has more than 11,000 different tax jurisdictions.

“There’s a reason TaxJar has been a top choice for businesses: their software tools make it incredibly easy to handle sales tax,” said Dhivya Suryadevara, Stripe’s chief financial officer.

“With TaxJar, we will help millions of internet businesses running on Stripe with their sales tax and make it easier for them to sell internationally,” she added.

As part of the acquisition, the entire TaxJar team of 200 employees will be joining Stripe.

The acquisition comes as part of a prolonged spending spree by the company founded by Irish brothers Patrick and John Collision.

Stripe, which was recently valued at $95 billion following a recent fundraise has been splashing the cash, co-leading a $115 million funding round for US fintech start-up Ramp earlier this month and leading a $35 million round for payroll infrastructure firm Check and a $102 million investment in online checkout company Fast, earlier in the year.