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How Stripe, a company you've never heard of, powers the sharing economy

Caitlin McGarry | Oct. 1, 2013
Processing payments may not be sexy, but Stripe lets you seamlessly hitch rides and order takeout.

For apps such as Postmates, the process is a bit more complicated. When you place an order on the Postmates app, it arrives within an hour. Seems easy enough, but on the back end your payment has to be split among the courier, Postmates, and the retailer or restaurant that supplied the goods you bought.

It was a chicken-and-egg situation: Sharing-economy startups began using Stripe because the cash distribution possibilities were endless, and Stripe started adding more features because the company noticed those startups gravitating toward its service.

"We noticed that some of the fastest-growing companies weren't charging money for themselves," Collison says. "They were managing a marketplace of buyers and sellers, and helping broker those transactions...They would say, 'Okay, Stripe, you made it really easy for me to charge money and get it into my bank account, where it was really hard before. But I'm not actually looking to put all this money in my bank account, I'm looking to send it somewhere.'"

Postmates launched 18 months ago with Stripe built in from day one. Stripe added a feature for Postmates that allows the company to pay couriers immediately after Stripe processes each customer's credit card. That isn't such a big deal for users, but it keeps the bike messengers who carry all those deliveries happy. Happy bikers, happy customers.

"We want to give our riders and our couriers the money as fast as possible," Postmates cofounder and CEO Bastian Lehmann says. "That is something we developed together with Stripe."

Muddy international waters
Sharing-economy startups have made no secret of their international expansion plans, and Stripe is right there with them.

Stripe is now available in Canada, the United Kingdom, and Ireland, and the company is beta-testing operations in Australia, Belgium, France, Germany, and Spain. Changing currencies is easy—Stripe has offered that feature for a while now. But each country has different ways of doing business, a whole new set of financial regulations, and varying cultural views about money. Plus, Collison says, the sharing economy in Britain isn't the same as in the United States. Stripe plans to establish teams and outposts abroad to learn the ins and outs on the ground.

But Stripe isn't just focused on the sharing economy, or on startups. The company already counts Blue Bottle Coffee, New York's Museum of Modern Art, Pebble, and Vice among its clients, with bigger brands signing on all the time.

"The larger [a] company gets, the slower it tends to move and adapt to new technologies," Collison says. But large companies are turning to Stripe to power their newer projects. "We're seeing [it] already today, where Rackspace is using Stripe, [the Museum of Modern Art] down the street is using Stripe. As they build new things, they say, 'Let's use Stripe for that.'"


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