When Patrick Collison and his younger brother John were developing ideas in 2010 for new apps to create, they kept running into a seemingly basic problem: Even as it was getting easier to tap cloud services to create startups faster and cheaper than ever, one thing was still a pain in the app: accepting payments online from customers.
So the pair, already entrepreneurs from Ireland who sold their first company in their teens for $5 million, decided to turn that problem into a business. They set up a system that allowed developers to add a few lines of code to their app and start taking payments from anyone anywhere, for a small fee per transaction.
Today, their company, Stripe, processes billions of dollars a year for tens of thousands of companies, from other startups to the likes of Facebook, Salesforce, and Lyft. With a recent funding from Visa and other partners such as Apple and China’s Alibaba, Stripe is now valued at $5 billion. But CEO Patrick Collison and the company’s investors alike think that’s only the start. Hemant Taneja of investor General Catalyst says that when Stripe reached its first $1 million in transactions processed, the elder Collison said, “Only five orders of magnitude left.”
Taneja thinks Stripe indeed could be valued at $100 billion in the next few years if it plays its cards right. Just as Google turned search into an advertising empire and Amazon’s Web Services enabled the creation of many thousands of online businesses, he says, “There’s an opportunity for someone to create a platform that’s all about payments and commerce.”
It’s a heady possibility for someone who still hasn’t turned 27 years old, and who faces competitors from PayPal and Google to big banks. In an interview I conducted with Patrick Collison for a story in MIT Technology Review’s annual list of Innovators Under 35, the Stripe CEO had a sore throat, so he spoke softly, in a distinct if muted accent befitting his upbringing in Ireland’s Shannon region.
But his ambition–and a firm belief that Stripe and the sometimes controversial startups it enables are good for society–were apparent as we talked on a balmy late June afternoon at Stripe headquarters, a 106-year-old trunk factory in San Francisco’s Mission District. Following is an edited version of our conversation:
Q: What spurred your interest in technology early on?
A: I grew up in very rural Ireland. The Internet was kind of a connection to the greater world. It had a lot of significance. Maybe if I grew up in New York, I’d have already felt it. It was very clear if you grew up in the middle of Ireland just how potent a force the Internet was and could be. I was always seduced by the potency of computers and the possibilities for which they could be leveraged.
Q: When did you and John realize you needed what Stripe now provides, and when did you realize it could be a business?
A: We started working on it as a side project, while I was at MIT, and just being baffled at how convoluted and awkward this appeared to be. It seemed like a prevailing ecosystem designed to reduce the number of Internet businesses. …