The acquisition will help Stripe incorporate TaxJar’s tax services into its platform. Here are the top-line bullets you need to know.
Stripe, a payment processing platform, has acquired TaxJar, a provider of cloud-based tax services. All of TaxJar’s 200 employees will be part of Stripe once the acquisition is complete.
WHO ARE THE PARTIES TO THE DEAL?
- TaxJar – Based in Boston, TaxJar offers a range of cloud-based tax services, such as localized sales tax rates at checkout and submission of tax returns to local jurisdictions. It also enables e-commerce businesses and users to automatically calculate, report, and file their sales tax forms. The company has about 23,000 customers, including Microsoft, Coca-Cola, and more.
- Stripe – California-based Stripe’s payment processing platform allows merchants to accept online payments and process financial transactions in over 100 countries. The company is currently valued at $95B.
Source: TaxJar
WHY DOES THE MARKET MATTER?
The acquisition strengthens Stripe’s position in the sales tax software space where:
- The global sales tax software market is projected to grow at a CAGR of 8.8% to reach a value of $13.1B by 2027, according to The Insight Partners.
- Emergence of innovative startups and growing investments in cloud-based software to develop efficient tax management in industries like retail, technology, telecom, transportation, and healthcare are fueling the demand for tax automation tools.
- Sales tax automation reduces cost and errors and helps businesses stay updated with the constantly revising sales tax laws globally for cross-border companies.
