Warren Buffett's Berkshire Hathaway bought into a Brazilian card-machine company on its way to Nasdaq. StoneCo's founders had spent twelve years starting and selling payment businesses in Brazil, where a few big banks controlled how shops took cards. Small merchants paid high fees and got poor service. Stone set out to win them one at a time with local sales teams and quick support. When it filed in 2018, Stone was betting that service could beat size.

Twelve Years of Payments

André Street and Eduardo Pontes had built Braspag, a leading online payments gateway in Brazil, before the idea for Stone came to them in 2012. They started with online merchants and plugged them in through simple software. Then they moved into physical stores, where most Brazilian commerce happened. Stone placed sales and service staff in local hubs close to its clients. It earned fees on each card payment and on advancing merchants their money early.

A Billion-Dollar Debut

StoneCo priced its IPO at $24 a share on October 24, 2018, above its $21 to $23 range. It raised about $1.1 billion, and Ant Financial bought $100 million more in a side deal. Berkshire Hathaway and T. Rowe Price were among the backers. The stock rose about 30 percent on its first day on Nasdaq. A push into lending went badly in 2021, and the stock fell far below its offering price. StoneCo still trades on Nasdaq as STNE.

Cover: Stone Bridge, Kitagawa Utamaro. Art Institute of Chicago, public domain. Chosen for a stone bridge (Stone, a bridge for payments).