Stripe acquires payment processing startup Lemon Squeezy

Payments giant Stripe has acquired its four-year-old competitor Lemon Squeegee, Lemon Squeegee announced on Friday.

Terms of the deal were not disclosed.

As a self-proclaimed “merchant of record,” Lemon Squeezy calculates and pays global sales tax for digital products, handling legal processing and fees in every country. It primarily serves SaaS and software businesses.

In a post on X, Stripe CEO Patrick Collison announced the acquisition, saying, “Welcome @lmsqueezy! We’re going to grow the merchant of record sales in a big way.” And Chief Product Officer Will Gaybrick shared in his own post: “When asked “what should Stripe ship next?” many of you named merchant of record. The Lemon Squeezy team has built a great MoR product, and we’re excited to work closely with them to help more of you scale!”

Lemon Squeeze co-founder and CEO JR Farr explained in a blog post that since his company’s public launch in 2021, it has received “multiple acquisition offers and (Series A) term sheets” from investors. In a podcast, Farr specifically discussed turning down a $50 million Series A term sheet. (It’s unclear how much, if any, venture funding the startup has raised.)

He added: “But despite the attractiveness of these opportunities, we knew what we had built was truly special and needed the right partner to take it to the next level. We’re proud to say we found that partner in Stripe and have gone from idea to acquisition in less than three years.”

While he didn’t share current revenue figures, Farr said Lemon Squeezy surpassed $1 million in annual recurring revenue nine months after its public launch in 2021.

The founder also said that Lemon Squeeze has been processing payments on Stripe since its inception.

This isn’t Stripe’s first acquisition this year. In March, the payments giant completed an “acquisition” of a four-person team from Supaglu for an undisclosed amount. Supaglu raised a $6.8 million seed round led by Benchmark general partner Chethan Puttagunta in November 2021. (Puttagunta did not respond to TechCrunch’s request for comment.)

SupaGlue, formerly known as Supergrain, was an open source developer platform for user-oriented integration.

And last summer, Stripe picked up a startup called OK, which developed a low-code analytics software to help engineering leaders understand how their teams are performing. OK was a small startup with just seven employees that over time raised $6.6 million from investors like Sequoia Capital and Kleiner Perkins after graduating from Y Combinator’s winter 2020 cohort.