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Business Models Business Operations

How Does Pipe Make Money (Business and Revenue Model)

The Pipe business model

Pipe logo
Here’s what you should know:
  • What is Pipe, and how does Pipe work?
  • How does Pipe make money?
  • Fixed Trading Fees (Commission Fees)
  • Pipe subsidiaries, acquisitions, and exits
  • Pipe profit and revenue
  • What is the Pipe business and revenue model?
  • Pipe funding, net worth, and valuation

How does Pipe make money? Well, here is a full, in depth, breakdown of their main revenue stream and services they offer, as well as the Pipe business and revenue model, how much money Pipe makes per year, and how Pipe works.

What is Pipe, and how does Pipe work?

Pipe is a trading platform for recurring revenue streams that enable companies to access upfront capital for growth without debt or dilution.

Founded in 2019 by Harry Hurst, Josh Mangel, and Zain Allarakhia, Pipe now has more than 8,000 companies on its platform.

So, how does Pipe work? To start using Pipe as an investor or company, you need to first visit their website and apply for an account.

If you meet Pipe’s criteria, you can then begin to bid for contracts of recurring revenue you’re interested in (if you’re an investor) or start accessing capital upfront without needing to take on debt or dilution (if you’re a company).

Some of Pipe’s competitors include Stripe Capital, Square Capital, Shopify Capital, and other companies that offer flexible financing.

How does Pipe make money?

According to Pipe and reports, Pipe has more than 8,000 companies that are trading more than $2+ billion of their annual recurring revenue (ARR) on the platform.

So how does Pipe make money off of all these companies, investors, and tradable revenue?

Below is a breakdown of how much money Pipe makes and its revenue model. Including their main revenue stream and how much they charge for their services.

Here is how Pipe makes money in 2022

Pipe has a revenue model that makes money in just one (1) way; through the trading fees they collect from investors and companies on the platform.

#1. Fixed Trading Fees (Commission Fees)

At this time, Pipe makes all of its money from the trading fees, or commission fees, they charge both investors and companies.

What are these trading fees and how does Pipe make money from it? These fees are for when an institutional investor or company bids for or commits their investment or recurring revenue through the Pipe platform.

When this happens, Pipe makes money by collecting up to 1% of the transaction for themselves (depending on the volume amount). Making it a win, win, win for Pipe, the investors, and the companies.

As noted above, Pipe now has more than 8,000 companies that are trading more than $2+ billion of their annual recurring revenue (ARR) on its platform. Of which, Pipe is getting up to a 1% commission fee on all of it.

How much does Pipe charge for transactions? (Pipe trading fees)

  • up to 1% of the transaction amount
Pipe dashboard | Pipe Business Model | How Does Pipe Make Money? | How Does Pipe Work?
Source: Pipe

Note: Pipe takes a trading fee from both investors and companies.

Pipe subsidiaries, acquisitions, and exits

To date, Pipe has made a total of 1 acquisition.

Mergers and acquisitions business model
Source: Crunchbase | Pipe

Pipe profit and revenue

Pipe has not released any official reports in regards to company earnings.

Note: Because Pipe is a privately held company, they are not required to make their annual reporting, such as Form 10-K’s, pubic.

What is the Pipe business and revenue model?

Pipe makes money through a few revenue models that they combine within their company, they are:

  • Commission based business model
  • Business to business (B2B) business model
  • B2B2C (partnerships) business model
  • Mergers and acquisitions (M&A) business model

Pipe funding, net worth, and valuation

Pipe’s Crunchbase profile shows Pipe has raised $316 million over 5 rounds and has a valuation of $2 billion as of May 2021.