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How the Collison brothers turned ‘seven lines of code’ into Stripe

bloomberg.com

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Re: How the Collison brothers turned ‘seven lines of code’ into Stripe

#151

Post by foxylad »

shimon_e wrote: post #23
Kluny wrote: post #11

Earlier quoted context omitted.

To expand, it's these 7 lines. (Actually 12) - more or less. Maybe not precisely that, but it's the bit where you add a payment form to your website. It's a nice headline, but it really leaves out the tremendous amount of back-end work that went into making that front end easy to use.

The PayPal form is roughly the same number of lines. The real break through for stripe was it was an alternative to PayPal with a modern UI.

We moved from PayPal to Stripe. Yes, integration was much easier, because of the simple and effective API and great documentation (good examples with your own data included - brilliant!).

But we switched because PayPal just did not work. A significant percentage of card transactions failed for absolutely no reason, despite "good" customers (school teachers from first world countries), no chargebacks and no fraud. Cards would routinely magically work the next day, and in the end we came to believe PayPal arbitrarily failed card transactions to force people to set up PayPal accounts.

Moving to Stripe resolved this overnight. We'll never go back.

Re: How the Collison brothers turned ‘seven lines of code’ into Stripe

#154

Post by sadlyNess »

stevenj wrote: post #144
pieterhg wrote: post #65

Earlier quoted context omitted.

Patrick is awesome! He asked me to have lunch after I tweeted feature suggestions about Stripe. Indeed, which founder of a billion dollar company does that (or has time for that)? Another time, I had trouble getting the Stripe code to work and Stripe's former CTO Greg Brockman debugged my PHP code (!) to fix it for me. I'm not making this up. The CEO wants to have lunch with me (a nobody) and the CTO debugs my code.…

Why do you think Stripe will get acquired (and soon)? I personally think it'll stay a standalone company because its founders already have plenty of money (from Auctomatic and presumably from taking money off the table during Stripe's funding rounds) and seem intensely motivated to change the world by having a pivotal role in increasing the GDP of the internet (as stated in the article). That, coupled with its (both…

Erm, how does taking money off the table when raising a round work? (just never heard of it)

Re: How the Collison brothers turned ‘seven lines of code’ into Stripe

#155

Post by sgc »

sadlyNess wrote: post #154
stevenj wrote: post #144

Earlier quoted context omitted.

Why do you think Stripe will get acquired (and soon)? I personally think it'll stay a standalone company because its founders already have plenty of money (from Auctomatic and presumably from taking money off the table during Stripe's funding rounds) and seem intensely motivated to change the world by having a pivotal role in increasing the GDP of the internet (as stated in the article). That, coupled with its (both…

Erm, how does taking money off the table when raising a round work? (just never heard of it)

Raise 100M, 20M is set aside for salaries/bonuses. As long as the numbers work and people believe you, investors like people who want lots of money, because they know they are going to work their asses off to make a profit.

Re: How the Collison brothers turned ‘seven lines of code’ into Stripe

#156

Post by bigtunacan »

My comment/question isn't about Stripe per se, but rather the surcharges of payment processors in general. It seems like 2.9% + .50 is about average, but then I see a site like https://sendmoneytoschool.com/ and they are charging a $1.00 processing fee for credit card payments to put lunch money in my kids' school account.

Is there some way to get super low processing fees if you don't use something like Stripe? Or are they taking money from the school and the parents? I'm just wondering how low of a rate is is possible to get for your ecommerce credit card payments?

Re: How the Collison brothers turned ‘seven lines of code’ into Stripe

#158

Post by AdieuToLogic »

ckinnan wrote: post #52
shimon_e wrote: post #23

Earlier quoted context omitted.

The PayPal form is roughly the same number of lines. The real break through for stripe was it was an alternative to PayPal with a modern UI.

Nope. The Stripe advantage over PayPal is that Stripe operates more like a merchant account, where the buyer sees the seller's name on the credit card statement. PayPal injects itself into the checkout process, Stripe is basically a white label. Stripe also has easier underwriting. I suspect Stripe is taking more business from merchant accounts/gateways than PayPal, because they are different markets.

  The Stripe advantage over PayPal is that
  Stripe operates more like a merchant account ...
Stripe is an ISO with First Data Merchant Services (FDMS, I believe now owned or controlled by Wells Fargo) doing the actual processing and, as such, assumes a different legal role than PayPal (which is a VAR for Paymentech). This is how Stripe is, as you say, "basically a white label."

Re: How the Collison brothers turned ‘seven lines of code’ into Stripe

#159

Post by AdieuToLogic »

strictnein wrote: post #34
whipoodle wrote: post #21

The bit about Amazon is the actual news contained in the story, if anyone here is interested in discussing that.

Yeah, this is really, really interesting: > Stripe’s new partnership with Amazon. com Inc., the largest and most sought-­after customer on the internet. Over the past couple of weeks, Stripe began handling a large, though undisclosed, portion of Amazon’s transactions. Lots of questions about why Amazon would do something like that. Is it so they have a backup in case their systems go down? Or was Stripe actually able…

  Or was Stripe actually able to get better
  rates than Amazon was ...
I can say with high confidence that this is not the case. Amazon processes through Paymentech on their Salem platform. Effectively, this is the Stratus side of the house which is optimized for high-volume batch oriented customers.

Since Stripe is an ISO with FDMS, they will always have higher fees than a relationship with an "on-the-rails" bank for merchants with volume anywhere near Amazon.

IMHO, a more likely scenario is that Amazon is looking to acquire Stripe, take over the ISO relationships with their merchants, and leverage from there.

Re: How the Collison brothers turned ‘seven lines of code’ into Stripe

#160

Post by AdieuToLogic »

samblr wrote: post #129

>>>> "Stripe made its debut in 2011 .... had spent two years testing their service and forming relationships with banks, credit card companies, and regulators so customers wouldn’t have to". Can somebody help throw light on: how Paypal was lagging in 2011 when compared to stripe ? -OR- how Collisons went forming better relationship with bank to build a system better than Paypal ?

Stripe is an ISO with First Data Merchant Services (FDMS, I believe now owned or controlled by Wells Fargo) doing the actual processing and, as such, assumes a different legal role than PayPal (which is a VAR for Paymentech).

The "two years testing their service" part is longer than a lot of ISO certifications, but that all depends. Ultimately, though, it's a lot easier to be certified as a VAR due to the fact that the processor (a bank usually, though can be an ISO) assumes more responsibility (risk/liability) in the relationship.

Regarding "forming better relationship with bank [sic]", it's not so much that one is has a better relationship than the other as it is their relationships are fundamentally different.

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