/dev/payments, renamed Stripe for obvious reasons of pronunciation and spelling, continues to cause a stir on the other side of the Atlantic. This online payment company, originally from Ireland and now based in California, is always on the lookout for new ways to offer an ever more modern service.
The development of cryptocurrencies, the various investments received and new functionalities punctuate the evolution of the platform, which is now present in 110 countries.
How did Stripe make such a rapid ascent? Who are its partners? What about integrating cryptocurrencies into the application? Dive with us into the heart of the $22.5 billion American unicorn.
What is Stripe?
The most compelling aspect of Stripe is its meteoric rise. Founded in 2010 by two brothers, John and Patrick Collison, the company has successfully completed a number of fund-raisings, enabling it to become one of the leaders in online payments. Here's a look back at a successful seduction operation.
Originally, /dev/payments
Originally, John and Patrick Collison founded a mobile payment company they decided to call /dev/payments. However, the pronunciation and spelling of the company were complicated for consumers, so the two entrepreneurs quickly decided to change the name of their project to Stripe. Since then, the company has come a long way, becoming a leader in its field.
Their project is simple: they want to enable their customers to pay directly via a mobile application and track transactions. What's more, consumers can pay without necessarily using a merchant account. The idea quickly caught on, and the application exploded within a few years.
Today, Stripe has enriched its offering to keep customers happy. They can now transfer money, detect fraud and issue virtual or physical payment cards for employees.
The temptation of crypto-currencies
In 2014, cryptocurrency entered the public arena. It was then that Stripe decided, thanks to a partnership with FTX and Blockchain.com, to integrate Bitcoin into its system. Bitcoin. The initial idea being to "enable buyers to access locations where credit card penetration was lower or in use cases where credit card fees were prohibitive" according to a brand release.
However, Bitcoin has been losing momentum in recent years, which is why Stripe decided in 2018 to exit Bitcoin. Indeed, fees had significantly increased and the company considered that the cryptocurrency carried too great a financial risk. In addition, transaction confirmation times were getting considerably longer, impacting Bitcoin payments.
Since 2022, Stripe has decided to return to cryptocurrencies, but with much stricter control over transactions. Users must now be identified before they can pay in cryptocurrency. Today, it's possible to pay or convert to cryptocurrency with Stripe, and thanks to various partnerships with Just Mining or the exchange FTX.
Renowned collaborators
The Irish-born unicorn now has over 1,300 employees and nearlymillion corporate customers such as Google, Facebook, Deliveroo, Spotify and Uber. Various rounds of financing and fund-raising have enabled the company to grow.
Potential quickly recognized
Stripe's success in attracting funding is due to investors' ability to recognize the company's potential. Shortly after its creation in 2010, Stripe received funding from startup incubator Y Combinatorstartup incubator, enabling it to grow more rapidly.
In February 2012, two years after its creation, Stripe was already valued at 100 million dollars. The following year, the company received $20 million from various investors: Sequoia Capital, General Catalyst, Peter Thiel, Chris Dixon, Redpoint and Aaron Levie. Four years later, in 2016, Stripe raised a further $150 million (including Google), bringing its valuation to $9.2 billion.
Finally, in 2019, Stripe raised $100 million from Tiger GLobal Management, boosting its valuation to around 22.5 billion. Stripe's rapid ascent has literally seduced investors, and the number of customers is growing daily.
What's next?
Stripe's rise to prominence has been rapid, and the company has no intention of stopping there. The company's objectives are diverse, and its development is far from over.
Heading for Asia
The Asian market is attracting a great deal of interest from investors due to its demographic characteristics (Asia is the most populous continent on the planet, with almost 4.5 billion inhabitants) and the rapid pace of its digital development. Countless Western companies are trying their luck in Asia, and Stripe aims to follow in their footsteps.
First of all, Stripe is planning to open an engineering center in SingaporeThe aim is to meet the needs of its customers in the region, namely Grab and Carousell. This would not be the company's first hub, as Stripe already has one in Dublin, San Francisco and Seattle.
In July 2018, Stripe entered into a partnership with Chinese payment platforms Alipay and WeChat Pay. Thanks to this association, Stripe users can now receive payments from both Chinese apps.
New features to come
Stripe's success in winning over so many consumers is due to its constant quest for innovation. After launching its cryptocurrency conversion and buying/selling system, the unicorn continues to scrutinize its users' behavior to offer them increasingly tailored services.
Stripe's next project is to offer its customers a premium offer which will be reserved for users with the richest accounts. These users will then have privileged access to ever more powerful functionalities.
Worrying competition
Online payment services are proliferating across the globe. In Africa, for example, unicorns such as Nigeria's Interswitch and Egypt's Fawry. Stripe's conquest of the American continent therefore seems complicated.
In Western countries, American giant PayPal and Dutch start-up Adyen (which has already gone public) are well established. It's hard for Stripe to break into this market.
The major challenge for Stripe is to to diversify its functionalities and offer an ever more intuitive interface to continue winning new customers. It's a tall order for Stripe, but fortunately, the unicorn is no stranger to challenges.
A possible IPO?
With big-name investors (Elon Musk, to name but one) and an ever-increasing valuation, the question of an IPO is beginning to loom large for the Collinson brothers. It should be added that, with a fortune of almost $4.3 billion, they are among the ten youngest billionaires in the world. ten youngest billionairesaccording to Forbes USA magazine.
According to experts, an IPO would value the unicorn at between 45 to 100 billion dollars. However, the two entrepreneurs remain discreet on the subject, and have yet to give a date for a possible IPO.
In 2021, Stripe developed a revenue recognition system to simplify their accounting and automate bookkeeping. Stripe continues to expand with the acquisition of Recko to help companies automatically reconcile payments. Finally, the company has extended the number of payment terminals on the European continent.
Stripe: key information
Workforce
By June 2020, the Irish-born Californian unicorn had nearly 2,500 employees.
Sales figures
In 2020, Stripe reported sales of $7.4 billion, an increase of around 70% on the previous year.
Initial public offering
To date, Stripe has not gone public. The startup's two founders are keeping quiet about an IPO, but experts suspect they are preparing for one.
Business and strategic objectives
The company's objectives are varied. Firstly, they wish to offer new functionalities on their application to continue attracting new users. Secondly, the Collinson brothers aim to enter the Asian market through partnerships.
Scalability
If the company has succeeded in establishing itself as a leader in the online payment sector, it is above all thanks to its ever more innovative functionalities and its perfect understanding of contemporary financial issues. Investors are well aware of the unicorn's potential, which is why they continue to fund it. With a possible IPO, it is estimated that Stripe could be worth between 45 and 100 billion dollars.
Mantra/Citation CEO
A complete payments platform (a complete payments platform).
