Online sales is big business; in 2020 alone, US e-commerce grew by 44 percent, accounting for 21.3 percent of total American retail sales for the period.
In other words, there’s a lot of money in money.
It’s something Patrick and John Collison (32 and 30) know well. The Irish entrepreneurs founded Stripe in 2010 after receiving $2 million worth of investment from some of the biggest names in tech.
Flash forward a decade Stripe’s most recent round of funding saw the company raise $600 million after an incredible $95 billion valuation – an increase of almost 300 percent in less than a year.
Amazingly, this makes Stripe the world’s second most valuable venture-backed company behind ByteDance, the $180 billion company behind TikTok.
A financial services and software as a service company, Stripe has found fortune by revolutionising and updating how online transactions are carried out.
Prior to services like Stripe, the technology underlying e-commerce was dated, with companies required to go through a rigorous and timely process before they could start trading.
Stripe simplified this by allowing merchants to accept credit card payments directly to their apps or websites.
Stripe itself estimates that 75 percent of UK adults have made a payment via Stripe over the last year via platforms including Deliveroo, Zoom and Instagram. And for each payment, Stripe takes a small percentage of the profit.
Early investors induced Lyft, Facebook and Elon Musk and Peter Thiel. Today, it is believed Stripe handles a large amount of Amazon’s transactions – which may account for its incredible valuation this year.
It’s a valuation made all the more impressive considering the company was valued at $9.2 billion in 2016, at the time making the brothers the world’s youngest self-made billionaires with an estimated worth of $1.1 billion each.
As of 2021, Stripe’s customer base counts over 50 companies that each process over $1 billion annually, with its enterprise revenue doubling year on year.
The pandemic has played a part in Stripe’s recent growth, with over 200,000 new companies signing up to the platform since the beginning of the Covid pandemic. According to co-foudner John Collison, Stripe handled over 5,000 payment, refunds and customer data requests per second in 2020.
“Stripe itself is now bigger [by payment volumes] than the entire e-commerce market was when we started working on Stripe,” he added.
To unlock this article, please subscribe. Benefits include:
- Offers, benefits and access to exclusive clubs, restaurants, bars, gyms, hotels and handpicked brands
- 2 Bookazines delivered to your door each year
- 15% off selected brands online with the Gentleman's Journal Shop
- Events — invitations to member-only events each year
- Paywalled content — access to member-only password-protected online features
- Your own Clubhouse membership card to redeem all the perks