Warren Buffett’s Company Buys Shares Of Fintech Startups
Investment firm Berkshire Hathaway, headed by a billionaire and famous bitcoin critic Warren Buffet, began supporting fintech startups, The Wall Street Journal reports.
Buffett's company invested about $600 million in a Brazilian startup StoneCo and fintech project from India Paytm. Both companies correspond to Berkshire Hathaway preferences as they dominate their domestic markets and work in a regulated industry. In particular, Stone is considered the fourth largest payment operator in Brazil, and Paytm has 300 million users worldwide.
Previously, the holding preferred shares of large companies with stable income like Coca-Cola, however, in the past few months, it was following the trend and invested in two aspiring payment services.
The decision to purchase shares of these fintech startups was made by Berkshire Hathaway’s portfolio managers Todd Combs and Ted Weschler. The owner of the holding, Warren Buffett, argued that the technologies are not in the Berkshire Hathaway’s sphere of interest but later reported the need to find a new niche for investment.
Stone shares went up by 30% in the first days after the news about being financed by the corporation. As the startup team said, they expect a long-term investment from the holding. In his turn, Buffett refused to share his opinion on the deal.
The holding acquired Stone shares during the initial public offering, though Buffett spoke negatively about IPOs before. He believes that this gives sellers extra advantages.
Earlier, the BitGo crypto wallet received $15 million from Galaxy Digital and Goldman Sachs.