Limerick brothers Patrick and John Collison, the founders of the online payment system Stripe.
Photo by: Forbes
The Irish brothers who built their 1 billion dollar company say they ‘won’t cash out’.
John (23) and Patrick (25) Collision, who founded Ireland's newest technology company, say that they are only getting started.
‘Stripe’ provides a low cost method for companies to accept credit card payments online without administrative and financial hassles.
The venture has been hugely successful and has just received new funding of approximately $70 million dollars from some of Silicon Valley’s canniest investors. This new funding values the company at around $1.3 billion.
The oldest of the brothers, Patrick, said the latest valuation reflected the promise shown by Stripe, which processed billions of dollars in payments for businesses last year. These varied from small companies to the Museum of Modern Art in New York.
Stripe’s rapid growth has inspired talk in Silicon Valley that it could threaten Paypal, which has not faced serious competition for over a decade. Stripe collects 2.9% from every transaction plus 30 cents.
There should be more transactions happening on the internet on a macro basis, whether you believe that should be 20% or 40%.
Paypal's Co-Founder Peter Thiel, who backed the Limerick brothers early on, led Stripe’s recent funding round through his venture capital firm, the Founders Fund.
“It’s a nice validation of what everyone has done over the last year,” Collision said of the investment.
However, the Limerick native did not respond to any direct comparison to Paypal, only saying he was confident the demand for payment processing would only explode in the coming years, as only 2% of all commercial transactions take place online today.
“There should be more transactions happening on the internet on a macro basis, whether you believe that should be 20% or 40%. Well, what is holding it back? Our goal is to expand internet commerce.”
According to John, “It's still early days for the payment systems that power the internet," he said. "It's outrageously difficult and expensive to move money between countries.
"Fraud and storing credentials still cause merchants hassle. So online payments is a great place to go hunting for problems worth solving."
The runaway success story began when the brothers became infuriated by how difficult it was to accept payments from customers online.
"We had found it really hard in our previous business to accept payment over the internet,"
"It felt like many other people would be having the same problem, so we set about solving it."
Despite the landmark nature of the company’s current funding, John said that there were no single breakthrough moments for the young company.
"It feels to me more like the product of lots of little breakthrough moments," he said. "It was lots of incremental steps."
He also revealed that the brothers were working on the service long before they announced it to the world in 2011.
"Many people don't know this, but we started working on Stripe almost two years before it launched publicly," he said. "There was a long period where we were writing code to support a small handful of users, and navigating a relatively unfamiliar industry.
"We wrote the first lines of code in October 2009. Three months later, in the following January, we got our first customer. We stayed going, writing code, starting to hire people and trying to find new customers. By the time we launched publicly in September 2011, we were 10 people."
Stripe now processes billions of dollars a year for thousands of businesses, from newly-launched start-ups to Fortune 500 companies. The company is headquartered in an old trunk factory in the Mission district of San Francisco.
In 2013, Patrick and John were named in The Sunday Times’s Irish Rich List with a €59m ($81m) holding in Stripe.