Stripe is a software-as-a-service company that offers a payment-handling system for e-commerce, websites, and mobile apps. Ten years after its foundation it’s valued at over $20bn and its products are used by the big five. Here are the three keys that made it succeed.
John and Patrick Collison, both brothers, were born in Dromineer, Ireland. They started developing ‘Shuppa’ while enrolled in MIT from which they eventually dropped out to dedicate themselves to their new venture ‘Shuppa’ an online instant grocery delivery service, while they developed ‘Shuppa’ they noticed most payment systems like Paypal charged a considerable fee per transaction to sellers. Later, Shuppa became Auctomatic, and they sold it to a Canadian company thus becoming millionaires. As they were developing their grocery delivery startup they came across a huge problem, there were lots of payment options with huge fees for sellers, especially Paypal. Besides, it involved entering third-party websites which considerably slowed down the payment process.
2. Finding and identifying the necessity
The brothers found a problem that had to be solved in their startup and learned that the vast majority of e-commerce and start-ups were facing the exact same problem, they didn’t come up with the next apple but identified Paypal’s flaws and built a service around the same concept.
One year later in 2010, they decided to compete against Paypal by charging lower fees and improving PayPal's strength and safety, this venture immediately grabbed the attention of angel investors such as Elon Musk and Peter Thiel, both founders of Paypal, who invested $2 million and venture capital firms. At first, Paypal was a banking system just like Paypal balance for the everyday user, but Paypal was a well-established company and it’d be very hard to get them out of business.
3. Pivoting toward your potential customers
When they realized that the general public wasn’t as interested they targeted their product to the startup and e-commerce owners who would benefit from their low cost and simple interface and integration. They were no longer a banking service like Paypal but a payment handling service for e-commerce and Startups who were potential customers. They pivoted, they shifted their business strategy to accommodate changes in the industry, customer preferences, and other factors, they became a payment system that unified all payment methods in one in exchange for a commission conversely proportional to your sales, and their target audience became e-commerce and mobile apps, hence they developed an easy to implement the system and easy to use interface so that Startups could easily manage and implement it with a single line of code and an API key
4. The timing
The reason their venture was a massive success wasn’t just the idea itself but rather, the timing, timing is undoubtedly the most important variable, even more, important than the idea itself, especially in tech companies.
Timing is the epoch when your product is released to the market, a good timing means that: There will be an actual need for your product, people will understand what it is and will find value in it, and technical requirements will allow your product to work properly. the first online streaming platform was released in 1997, but most people didn't have a computer at home, and adobe flash and the internet speed made it very difficult and time-consuming for the users to watch a video, the company went out of business 3 years later. 4 years after it shut down an online streaming platform was created in San Mateo, California, adobe flash had been deprecated and replaced by HTML, and the internet was much faster, thus users could access it easily. The timing was perfect and that’s exactly the reason why youtube is a company with a $28.8 billion dollar company and ShareYourWorld.com was shut down in 2001. Same as Stripe did, as the e-commerce online presence grew bigger and bigger they realized there was a huge flaw, they did it when most of the technology for online payment had been developed but not fully, therefore, their company grew as their customers grew and the number of e-commerce increased.
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