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Stripe valuation soars to $95B after latest fundraising

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Re: Stripe valuation soars to $95B after latest fundraising

#31

Post by ampdepolymerase »

buro9 wrote: post #29
manishsharan wrote: post #22

Earlier quoted context omitted.

Think of it this way: there is no opportunity for an new entrant into this market almost globally. Stripe's fee is low enough and its API is super easy to use and the brand is well loved by most ecommerce companies. A new entrant will have to go up against this enormous amount of goodwill that Stripe has accumulated. The only danger to Stripe is if a major bank decides to get into this space. I work for a major bank…

Disagree. Every ecommerce company and retailer looks at payment fees as money left on the table. The more money Stripe take on, the more they need to return to investors, and so the more pressure to make margin. That is the opportunity for the future. I too doubt it would come from a bank, nor from Visa and Mastercard... but could another exist? Yes! If it came from a big player, I'd be looking at Shopify.

Shopify already has a first party processor, but they are not available to non-shopify customers.

Re: Stripe valuation soars to $95B after latest fundraising

#32

Post by klelatti »

abalone wrote: post #28
manishsharan wrote: post #22

Earlier quoted context omitted.

Think of it this way: there is no opportunity for an new entrant into this market almost globally. Stripe's fee is low enough and its API is super easy to use and the brand is well loved by most ecommerce companies. A new entrant will have to go up against this enormous amount of goodwill that Stripe has accumulated. The only danger to Stripe is if a major bank decides to get into this space. I work for a major bank…

Low pricing is not a moat.

Why? If you have scale and the cost base that enables you to sustain the pricing profitably in can be very, very difficult for competitors to enter your market.

Re: Stripe valuation soars to $95B after latest fundraising

#33

Post by klelatti »

Graffur wrote: post #3

What is Stripe's moat? It's developer friendly but from my experience management will only care about the cost.

I just listened to a podcast with Patrick Collison in which he listed the ways in which Stripe's market seemed unattractive when they started out. Dauntingly complex, highly regulated etc.

Anyone looking to compete with Stripe will have the same thought process and probably won't bother.

And if they do then they will have to execute as successfully as Stripe over an extended period.

Edit: Just to add that the podcast was "The Knowledge Project" [1] - just a fascinating conversation.

[1] https://fs.blog/knowledge-project/patrick-collison/

Re: Stripe valuation soars to $95B after latest fundraising

#34

Post by ThePhysicist »

sebmellen wrote: post #4

This certainly makes Stripe the most valuable private startup in the world. Where does Stripe rank among the world's most valuable private companies, though? It's easy to find lists of dubious quality like this: https://news.yahoo.com/10-most-valuable-private-companies-21... , but I'm sure there are more lurking. What are they?

Bosch is privately owned and they made 71 B€ of revenue in 2020, so about 180 times bigger than Stripe.

Re: Stripe valuation soars to $95B after latest fundraising

#37

Post by disiplus »

klelatti wrote: post #33
Graffur wrote: post #3

What is Stripe's moat? It's developer friendly but from my experience management will only care about the cost.

I just listened to a podcast with Patrick Collison in which he listed the ways in which Stripe's market seemed unattractive when they started out. Dauntingly complex, highly regulated etc. Anyone looking to compete with Stripe will have the same thought process and probably won't bother. And if they do then they will have to execute as successfully as Stripe over an extended period. Edit: Just to add that the podcast…

sure that was then, but that changed over the years. stripe is not cheap, i'm pretty sure if somebody came with the same UX many would switch, us including. We are B2B and with postpaid so the customers are using Stripe to pay Invoices. There are zero charge backs or fraud but still have to pay high fees.

Re: Stripe valuation soars to $95B after latest fundraising

#38

Post by kjrose »

AlwaysRock wrote: post #35

Wow. It takes a lot of money to take on the PayPal monster huh? Incredible.

Well, and I could be wrong. Paypal was able to be basically a bank without having to follow any of the rules of what a bank needed to follow.

Sorta like Uber being a taxi service without having to follow any of the rules of a taxi service.

My guess is it's very expensive to beat someone who has already broken the rules to get to where they are before the rules caught up to them.

Re: Stripe valuation soars to $95B after latest fundraising

#39

Post by 0xy »

abalone wrote: post #28
manishsharan wrote: post #22

Earlier quoted context omitted.

Think of it this way: there is no opportunity for an new entrant into this market almost globally. Stripe's fee is low enough and its API is super easy to use and the brand is well loved by most ecommerce companies. A new entrant will have to go up against this enormous amount of goodwill that Stripe has accumulated. The only danger to Stripe is if a major bank decides to get into this space. I work for a major bank…

Low pricing is not a moat.

This is totally wrong, considering Stripe has enormous negotiating leverage.

My employer never bothers switching to any competitor because Stripe match any deal that their competitors present to us.

Could you, a single person and $500m of seed funding match Stripe's prices? Not without hemorrhaging cash.

One of Amazon's moats is low pricing as well, which can only be achieved with eye-watering scale (their margins are 0% in some categories, they make it up by delaying payments to vendors and pocketing the interest).

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