Fair and thank you for that. Wouldn't their value to Stripe be much more than 3.75x in this case?

Basically, there are 3 types of buyers: value PE, growth PE and strategic. Value pays 3-4x, growth 4-7x, strategics ¯\_(ツ)_/¯ Stripe would be a strategic for Baremetrics.

Hmm ... Where did you get these multiples from? Based on what I've seen in many sources (here's one that I have at hand, by McKinsey: https://www.mckinsey.com/business-functions/strategy-and-cor...), high-growth tech/IT startups are valued (and, I assume, could be acquired) at > 15x, sometimes even > 20x.

For public companies, growing > 40%, ARR > $100Mn, NDR>125$ revenue multiples are sky-high ATM.

For private companies at around $1Mn-$3Mn ARR growing sub-20% YoY there are very few buyers in the first place.

I was definitely talking about the first category (though not necessarily public only; AFAIK there are some [many?] private companies that fit that profile). I agree that those revenue multiples are high, though I'm not sure I would refer to them as "sky-high". Who knows what kind of numbers we will see in the future ... ;-)

Compared to public markets yes, but there are 100s of buyers, particularly if you’re (adjusted) EBITDA profitable, but even if just break even.

Public company multiples, VC investment valuations and lower middle market PE exit multiples are very different markets.

The multiples come from direct personal experience.

Understood. Though I would expect some overlap between the first two markets. I'm curious about reasons and rationale, underlying potential differences between valuation and/or multiples within relevant categories. Any pointers or links to corresponding content, by any chance?

And for the record, make sure you keep track of price/earnings vs price/revenue multiples :)