What's behind Stripe's OpenRouter move
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Payments company Stripe is in talks to acquire OpenRouter for around $10 billion, Wall Street Journal reported Thursday.
Why it matters: It says a lot about Stripe's ambitions as it seeks to represent the "GDP of the internet."
Driving the news: OpenRouter allows companies to switch between different AI models, a high-demand product at a time when companies are looking to control spending.
- It's not considered a fintech or payments company — but it is building a network, which is key for payments companies.
- OpenRouter also has the potential to represent AI spending, given its role as a gateway to multiple AI models.
Between the lines: In some ways, it's revenue model is similar to a payments firm. It charges a percentage fee for on top of the underlying model's cost. CEO Alex Atallah has notably compared his company to Stripe in the past.
- Ramp, the expense management company last valued at $44 billion, is also developing a routing product, as token costs become one of the biggest concerns for companies.
- Increasingly, tokens are becoming the new currency.
What they're saying: "As tokens become increasingly fungible with money, streaming payments in real time is an important part of Stripe's economic infrastructure for AI," a Stripe announcement earlier this year read.
State of play: OpenRouter has a wealth of suitors, from what we hear and from media reports.
- It was valued at $1.3 billion earlier this year, which could make a deal a rapid boon for investors include CapitalG and Menlo Ventures.
The bottom line: If token usage becomes much more spread out, these companies in the middle could be the ultimate (and less volatile) winners.
- Cursor launched a routing product, too, earlier this week. Databricks also has such capabilities.
