Stripe Helps Start-Ups Build On Its Platform

Stripe’s star is rising. The five-year-old online payments company started by Irish brothers John and Patrick Collison powers the buy buttons of Facebook, Twitter and Alibaba Group Holdings’ Alipay as well as those of thousands of other companies that process online and mobile payments.

In September it scored a coup by partnering with Apple to help power the ApplePay mobile wallet for the iPhone 6.

Elie Auvray, Jahia’s CEO (left) and CTO Emmanuel Garcin (facing right) chatting with employees at the French B2B software company

Stripe helps merchants see who is buying from them, and what patterns are emerging, and then guides them on where they should focus future efforts. It has raised $140 million in funding from investors that include A-list Valley firms Sequoia Capital and Andreessen Horowitz, as well as PayPal co-founders Peter Thiel and Max Levchin. It has a reported valuation of $1.75 billion.

Now it is helping other ambitious younger start-ups raise funding of their own and potentially become stars in their own right. To help strengthen the Stripe platform, early investor General Catalyst Partners announced in September that it had set up a $10 million fund to invest in start-ups building products to run on the Stripe Connect platform.

Geared Towards Seed-Stage Start-Ups

“We have watched this ecosystem develop with great interest,” Hemant Taneja, Managing Director at General Catalyst, said in a statement. “In Stripe Connect, we see the potential to build entirely new classes of services that enable businesses to better leverage their payments capabilities and data.”
General Catalyst said the GC Stripe Platform Fund is geared primarily toward seed-stage start-ups that have traction. Most investments will range from $250,000 to $500,000.

Stripe Connect enables businesses to connect their Stripe accounts (and their Stripe data) with other services: a company can start selling on Twitter, integrate with its web analytics, or access its Stripe data on a mobile device.

“The Connect ecosystem makes the business data for popular web services accessible for start-ups to build on,” John Collison, a scheduled speaker at Web Summit, said in an interview with Informilo. “This is an opportunity for a new breed of B2B applications that would have been really hard or impossible to build before.”

The first investment has already been announced: Baremetrics, which analyzes data for SaaS companies using Stripe payments, will receive $500,000 in funding.

The GC Stripe Platform Fund is focused on two categories: start-ups that are building extensions to the Stripe platform and add value to other Stripe users; and marketplaces or platforms that are built atop Stripe Connect, such as Bigcommerce or Lyft. The fund has global reach and says it will accept applications from start-ups in both mature and emerging markets which can accept investments from U.S.-based investors.

Stripe Is The Business Engine For Merchants

Traveling to Dublin for Web Summit will bring Collison back to his roots. He and his brother, who were raised in Ireland, are today considered to among the country’s most successful tech entrepreneurs.
Patrick won an Irish national science award in school while John scored the highest-ever score in the Irish Leaving Certificate. Both were accepted into top U.S. universities: Patrick at the Massachusetts Institute of Technology, John at Harvard. While still a student Patrick built a company called Auctomatic, which was sold to Canada’s Live Current Media for $5 million within a year of its launch.
The brothers started Stripe in Boston in 2009, before either had finished their studies, because they wanted to fix the kind of difficulties in accepting online payments that Auctomatic experienced.
It was clear that there was a need for a developer-focused payment platform, says John Collison, so he and his brother moved to the San Francisco Bay area to build up the online payments company.

“We set about building Stripe infrastructure for developers to weave into Web services; nobody before Stripe had really taken this approach before,” says Collison. “PayPal and Google with its earlier checkout were consumer offerings that happened to have a product for merchants,” he says. “Stripe is the business engine for merchants. We only do what is in the merchants’ interest.”

“We think of Stripe as building a universal payment structure for the Internet,” says Collison. “We are not building our own consumer wallet, we are building the underlying layer that powers the apps that powers the Web services but sits in the background.”

So what advice does he have for start-ups that want to get Stripe Connect funding? “We want to work with our business customers to help them sell more,” says Collison. “Those are the applications we get excited about.”



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