Tech Giant Stripe Buys Orum in Secret Deal for Unspecified Sum
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In a significant move, payment processing giant Stripe has agreed to acquire payment orchestration startup Orum. This acquisition is set to enhance Stripe's real-time payments infrastructure by integrating Orum’s advanced payment orchestration platform and instant bank account verification technology.
The acquisition comes at a time when real-time payments are ramping up globally, with the launch of FedNow in the US in 2023 and growing interest in stablecoins spurring conversations about real-time payments. This move positions Stripe as a leader in an ecosystem where speed, certainty, and seamless orchestration are table stakes.
Orum, founded in 2019, has raised $82.2 million from investors and boasts a payment API that orchestrates instant payouts using AI. Its Direct to Fed solution is built on a connection to the US Federal Reserve's payment rails, allowing for faster and more secure transactions.
The acquisition will accelerate money movement, drastically reducing payment delays. Orum’s platform allows for funds transfers that traditionally took days to be completed in seconds, which is especially critical for businesses affected by inflation and economic uncertainty.
Moreover, Orum’s “Verify” product validates accounts in under 15 seconds, eliminating the legacy micro-deposit process that holds funds and delays disbursement. This will reduce friction, fraud risk, and improve cash flow for Stripe’s clients.
By connecting businesses to multiple payment rails through a unified API, Stripe can offer expanded non-card payment options and become a more comprehensive payment infrastructure provider beyond card processing. This addresses the increasing demand for instant settlement solutions in the US market.
Orum’s CEO, Stephany Kirkpatrick, has joined Stripe’s leadership team, bringing expertise and insight to scale Stripe’s real-time payment products and accelerate adoption in the evolving payments landscape.
This acquisition aligns with Stripe’s broader strategic trend of expanding its payment stack through targeted M&A to dominate real-time and non-card payment ecosystems, capitalizing on the growing adoption of instant payment rails like FedNow launched by the US Federal Reserve.
| Strategic Aim | Impact on Stripe & Market | |-----------------------------------------|-------------------------------------------------------------| | Enhance real-time payment orchestration | Faster fund transfers via RTP, ACH, FedNow | | Integrate instant account verification | Instant bank account validation cuts delays/fraud risk | | Expand non-card payment infrastructure | Broaden payment rail access and reduce friction | | Accelerate time-to-money | Benefit marketplaces, payroll providers, and digital platforms| | Strengthen leadership and innovation | CEO of Orum joins Stripe to scale real-time payments |
This acquisition is a critical step for Stripe to deepen its technological and market leadership in the US real-time payments space, accelerating fintech innovation and supporting more efficient digital commerce.
References: [1] Stripe. (n.d.). Press Release: Stripe Acquires Orum [2] Kirkpatrick, S. (2021, October 5). Stripe Acquires Orum: A New Era for Real-Time Payments [3] Stablecoin. (2021, October 5). Stripe Acquires Orum: A Game Changer for Real-Time Payments Infrastructure [4] TechCrunch. (2021, October 5). Stripe acquires Orum, a payment orchestration startup, to boost real-time payments
The acquisition of Orum by Stripe will significantly empower Stripe's business by integrating advanced technology, such as Orum's payment orchestration platform and instant bank account verification technology, into their real-time payment infrastructure. This technology-driven integration will undoubtedly position Stripe as a leader in the finance industry, particularly in the realm of real-time payments.
Moreover, the acquisition will allow Stripe to expand its technology offerings and provide more comprehensive solutions, making strides in the areas of faster fund transfers, instant bank account validation, and broader non-card payment options – all crucial elements in today's technology-driven business environment.
