Stytch

Stytch provides APIs and SDKs that let developers add passwordless login, authentication, authorization and fraud prevention to their applications, and later positioned itself as an identity platform for AI agents. Reed McGinley-Stempel (CEO) and Julianna Lamb (CTO), who both built user authentication features at Plaid, founded the company in 2020. It was based in San Francisco. Its products competed in developer authentication, where it pitched an API-first approach rather than prebuilt login widgets, and added support for WebAuthn hardware keys and biometric logins in 2021.

Benchmark led a $6.25 million seed round raised around the time of founding in summer 2020, with Index Ventures and angels including Plaid co-founder William Hockey, Figma CEO Dylan Field and Elad Gil. In July 2021 Thrive Capital led a $30 million Series A, with Coatue Management, Benchmark and Index Ventures participating, at a valuation sources put above $200 million. Four months later, in November 2021, Coatue led a $90 million Series B with Benchmark, Thrive Capital and Index Ventures that valued Stytch above $1 billion. Stytch used part of that round to acquire Cotter, a Y Combinator backed no-code passwordless platform.

Developer adoption grew from about 350 developers in July 2021 to roughly 4,000 in November 2021, and the founders later said the platform served hundreds of millions of users across thousands of apps. Twilio announced on October 30, 2025 that it would acquire Stytch and completed the deal on November 14, 2025. Twilio's 2025 annual report states it paid $104.1 million in cash for all outstanding shares, or $58.5 million net of cash acquired.

Stytch is a clear example of a 2021 unicorn price failing to hold. Benchmark entered at the seed, Thrive at the Series A near $200 million, and Coatue led a Series B at $1 billion. The company was sold about four years later for $104.1 million, roughly a tenth of the Series B valuation and less than the roughly $126 million it had raised. How the $104.1 million was split among preferred and common holders has not been disclosed, but with the price below total capital raised, liquidation preferences would have determined who was repaid first. The deal also shows a common outcome for 2021 infrastructure startups: a strategic buyer already used by the target, in this case Twilio's SMS, email and WhatsApp verification products that Stytch relied on, acquiring the business at a fraction of its peak private price.