Having expanded to 25 international markets in its first five years, online payments platform Stripe has learnt commerce is cultural.
Discussing Stripe’s international expansion agenda during a media visit to the company’s San Francisco headquarters last week, Billy Alvarado, Stripe’s chief business officer, said it was critical to build a single platform that catered for the differences in cultural habits towards payments.
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“Money and commerce are oddly cultural,” Alvarado said. “There’s a lot of different reasons for that. People have a lot of different preferences for the payment instrument they use. There’s different levels of trust in the underlying commerce infrastructure and there’s different levels of infrastructure to actually support that.”
“It’s important to build the right technology platform, a single platform to handle the complexity of all the cultural preferences of how to pay from credit card payments to a boleto in Brazil. These are all ways we expect people will want to pay and ways businesses that use Stripe will want to receive payments.”
On top of cultural behaviours, providing global financial services brings with it a complex set of regulatory issues, Alvarado said.
“You want to build an organisation that can handle both the global nature as well as the local nature of this. It is important to partner with global players like Visa and MasterCard but also to build relationships at the local level with the businesses, with the developers, with the local payment instruments,” he said.
Growing the GDP of the internet
With nine global offices including one in Melbourne, Stripe has set itself the task of investing in building a infrastructure designed to “grow the GDP of the internet.” And they plan to be at it for a while.
“If you are operating the company by quarterly metrics and you are only looking to hit the next quarter’s metrics each time you would never make a big investment in international. You have to be willing to take a multi-year, decade-long investment,” said John Collison Stripe co-founder.
“The way we think about Stripe’s role is we want to build things that help grow the GDP of the internet. We’d like to build the tools and the APIs and the infrastructure that allows new kinds of companies to emerge and new kinds of products and services to get built,” Collison said.
“On a global basis less than 5 per cent of consumer spending happens online today. Compare that to how much time you spend in the digital world and how much value you get from it.”
According to Collison, “You can debate whether that number will be 20 per cent or 50 per cent or 70 per cent, but we clearly have an order of magnitude left to grow. This is the commerce we want to enable and accelerate. This is what we mean when we talk about growing the GDP of the internet.”
Stripe’s product roadmap is focused on global expansion and on building a tech stack of higher value tools that solve more problems for businesses.
For example, in 2016 Stripe launched its product Atlas, which according to the official spiel is “designed to give entrepreneurs everywhere access to the basic building blocks for starting a global internet business.” Atlas lets businesses incorporate a US company, get access to US bank account, tax and legal advice, and the Stripe account for payments.
“We are not under any illusions about how long it is going to take. We expect to be working on this for the next decade and still solving these problems on that kind of time frame,” Collison said.