The Exchanges

Q Uh, what, what'd you do? How, what was your, Invention or experiment or submission that won you young scientists of Ireland?

A Well, as we sort of touched on, I'd gotten really into programming, and in particular, I'd become interested in this programming language called Lisp, and I was kind of fascinated by Lisp because it had been invented in the late fifties, like really early in sort of the history of technology, but it had been kind of forgotten and ignored. The thing I worked on was sort of a new version of Lisp, trying to kind of update it, making it really straightforward to build sort of complicated web applications and things like that. And, you know, it's funny, it's only kind of looking back on it that this sort of becomes clear. I mean, from a very early stage, I was interested in sort of working on tools or just kind of building things that created leverage for others, and that basically the whole point of working on this programming language was to provide a tool that would make it easier for others to build things. And so I, you know, I didn't consciously think about it this way at the time, either kind of when starting Stripe or whatever, but basically all the things that I've worked on kind of Somewhat seriously have in some ways been kind of tools for creation.

AI assessment note: “The thing I worked on was sort of a new version of Lisp”

Q already started and sold a business, and a lot of investors love that. They love to see that experience. Um, but did they ask you, were you asked tough questions by potential investors? Like, for example, you know, you guys are really young. How are you gonna manage people? Or, um, you don't have any connections or involvement in the financial industry or background. Did you get questions like that?

A Surprisingly, no. Uh, I think people are used to that in Silicon Valley. I mean, by the time people become famous, uh, because, because the thing they worked on succeeded, they tend to be older. But that means the mental image we have Uh, of people who do successful things is like 10 to 20 years, maybe even more, older than the ages at which they tend to have actually done them, right? And, uh, VCs and investors and just people in general in Silicon Valley, I think, are sort of unusually sort of attuned to this fact and recognize and realize that sort of, hey, really significant work not only can be done by people in their twenties, but is very commonly done by people in their twenties. Uh, and so, you know, I think that's kind of to their Great credit, and, you know, we really benefited from it. Uh, the, you know, the thing that has, I mean, this is not to suggest that investors, you know, rushed with enthusiasm to invest in Stripe. Most investors said no, but the reason was much more, or reasons were much more because they just thought it was a bad idea, rather than the kind of, uh, real bad people to execute it.

AI assessment note: “Surprisingly, no. Uh, I think people are used to that in Silicon Valley.”

Q and I have Lyft, or you guys, I guess, have my credit card, and so you have to communicate with my credit card company to, um, make sure that they are charging me Uh, so then my bank account will be able to pay the credit card company later. Um, presumably you also have to pay the credit card company, right? Like they're taking a cut of your money too.

A That's exactly right. So what's happening underneath the hood when you use any business powered by Stripe is, you know, you probably type in your credit card. You probably only type it in once and then it's saved with your profile for any time you use it in future. That is securely sent directly to Stripe. So it's not, you know, hitting, uh, or it's not being stored on other servers. And then When a business wants to actually, you know, accept money and charge your credit cards, and you know, over time, it's now more than just credit cards. There's bank transfers and different international payment methods and things like this. But the business that wants to charge your credit cards, they say, hey, I'd like to charge this card 20 dollars, and, and we put money in their bank account, and we have, handle everything that goes on between that instruction and the money arriving in their bank account. It's actually pretty complex what goes on under the hood. But again, our aim is that people did not start businesses so they could deal with the minutia of the financial system.

AI assessment note: “That's exactly right. So what's happening underneath the hood when you use any business”

Q So as you started to really You know, launch and develop and get more and more attention. Why didn't the competitors come out from the woodwork? Why didn't like PayPal or these other transaction, um, companies, Square and stuff say, we're just gonna do what they do. Did they try?

A Well, what we were doing didn't look that important back then. Uh, it wasn't the case that sort of we immediately, uh, or what we were doing immediately, uh, looked like it was obviously working and obviously of, of major significance. We were, Back then, in the eyes of others, sort of working with all these inconsequential little companies, uh, and making their lives a bit easier, but, well, was this mobile payment thing actually going to amount to much, uh, in aggregate? Were, were there actually that many developers that would be starting these successful companies? I mean, again, it kind of gets back to this pessimism around technology that kind of existed and prevailed around 2009, 2010, and so on, and this is one of the great facts about our industry, uh, is that you cannot turn Money into great products, uh, as a kind of mechanical operation. Uh, if it were possible, there would be many more great iPhone competitors. Facebook would have been long since eclipsed by MySpace or Yahoo or Google. Mobile banking apps would be really good to use.

AI assessment note: “what we were doing didn't look that important back then.”

Q So your dad was running this hotel, and were you guys involved with it at all? Like, did you have to To go there on the weekends and like change sheets and, and, you know, mop the floors?

A Well, remember, you know, Pat, I think it was, Pat was probably four, uh, when they started, I was two, uh, and so, you know, there's only, you know, a two-year-old can only be so useful, uh, in the operations of the, uh, of the hotel. I think my favorite memory is the, uh, you know, the, the ballroom floor, the highly polished surface. Uh, that was awesome as a kid for, uh, for kind of getting a, you know, kind of a length game in terms of who can slide the furthest, but, uh, Much in all is I'd like to imagine that we were extremely useful in, in running the hotel. I think we were primarily a hazard.

AI assessment note: “a two-year-old can only be so useful, uh, in the operations”

Q I mean, I mean, essentially, your competitive advantage was Was you guys?

A I think it's, um, an amorphous combination for any of these products, and I don't mean to single stripe out, for any great product, some amorphous combination of sort of the ethos and the culture and the people and sort of the work style and kind of a fingertip sense for the priorities and all these things that are just like very hard to copy. I mean, it's, There's sort of a continuum, uh, where, uh, at one end, you know, you're, um, you're manufacturing steel, and at the other end, you're, you know, you're manufacturing novels. And in steel manufacturing, sure, you can turn capital into more, better, cheaper steel, and at the other end, it's very hard to know how you, how you turn the money into kind of better writing. And software is, is somewhere in between. And I think this is kind of constantly the challenge of For people looking to analyze and make predictions in the industry, where again, Google should have beaten Facebook.

AI assessment note: “some amorphous combination of sort of the ethos and the culture and the people”

Q guys know that this was huge? I mean, you know, it was going from this idea that you have in Cambridge, Massachusetts, to raising two million, to Being valued at 20, and then a hundred, and then a billion, and then today, more, almost ten billion dollars. When did you, did you ever have a moment where the two of you sat back and said, wow, look what we built?

A There's never really been time for that. Um, and there's nothing like a young company to every morning remind you that there's so much left to be done, so much that's not yet working the way it should be. I mean, it's really quite visceral. You wake up in the morning, and there are 20 emails in your inbox that are sort of somehow all related to things that you're doing badly or wrongly. There's never a moment when it feels successful. And there's a quote that I Kind of often think about from Greg Lamond saying, of course, the cyclist, um, it never gets easier, you just go faster. And I used to kind of cycle quite a bit, and there's a lot of sort of, uh, you know, painful truth to that, where as you cycle more, as you practice more, as you get fitter, as you get faster, as your form gets better, sure, you start cycling faster, your times get better, but the experience of being on the bike never gets easier. The pain that you feel on the first bike ride, that's the same pain that you're going to feel on your 500th bike ride. You'll just be going much faster on the 500th bike ride, and it kind of feels like that in the startup, where every day now, the problems and challenges are, and, you know, visceral pain is just as acute as when we were starting out. The problem is just of a different form. It's, it's this kind of Relentless process of trying to shift what it is that exists a…

AI assessment note: “There's never really been time for that.”

Q When you think of this number, last year, 9.2 billion dollar valuation, does that mean anything to you? I mean, is it abstract? Do you think Man, I'm rich, or, or, do you even, does it even cross your mind? Must at some level, right?

A It's been my experience that people pay a huge amount of attention to the headline numbers of Silicon Valley companies, and so, you know, Stripe is a company that's been valued in fundraising at, you know, 9.2 billion dollars, or what have you. There is an assumption baked in that Stripe continues to execute very strongly, and so it would be a very dangerous mode to slip into becoming rearward looking and looking at everything that has happened to date, because the much more relevant fact is, What we release in 2018, what we release in 2019, what, what Stripe's global expansion looks like and, uh, and things like that. You, you don't have a valuable company unless the company continues to execute. It's very dynamic.

AI assessment note: “it would be a very dangerous mode to slip into becoming rearward looking”

Q What, how much of, of, of the success of this company do you attribute to your skill and your, you know, your intelligence and how much to luck?

A I think the question is less about, you know, how much can be attributed to my skill and intelligence, uh, and instead to the skill and intelligence of the hundreds of people who've gotten the stripe to where it is, and I guess I would say that skill and intelligence, and especially, most importantly, intense application and hard work, I think all those things are necessary. I think had they not been there, had there not been so many people who just came up with So many smart ways of doing things and, you know, in many cases toiled at such length. There's not a chance, not a sliver of a chance that we would be here. But I also think that the luck was required too. There, there are, again, groups of people who are smarter and harder working than us who just didn't have the same good fortune.

AI assessment note: “I also think that the luck was required too.”

Q So you guys had a couple 100,000 bucks from the sale of Octomatic, and obviously you had the coding chops and the technology chops, but you did not have any money. How are you able to, to get money to, to, you know, fuel the ambitions of this company?

A One of the things that Silicon Valley does well is it probably has the high, you know, Patrick and I now travel to a decent number of other places, and Stripe has offices around the world, and Dublin and London and Singapore and places like this. But, but I think Silicon Valley is probably the best place in terms of the risk tolerance of the investment capital that's available. If we could get people convinced of the opportunity, and if we could show people that initial early customer traction, and how much it resonated with the target market, they were actually willing to take a bet, despite the fact, I mean, when you look back on it, there was a vast amount of uncertainty in every other Aspect of the execution between, would Patrick and I be able to get visas for, you know, for the United States to work here, to would we be able to hire, to what would the long-term, ah, you know, financial partnership structure, things like that look like. But people are willing to look past all of those things to the opportunity.

AI assessment note: “if we could show people that initial early customer traction... they were actually willing”

Q So what did Peter Thiel see in Stripe? Like, was it just easy to use? I mean, was it the kind of thing where a software developer would be like, oh my god, somebody has finally figured this thing out.

A I, I think many of the developers were just really glad that someone was finally paying attention to them at all. Now, as it happened, we paid obsessive attention to them, and we were really building for that audience, but the baseline that people were working with was very low. It was not competitive. I think what changed and what we were fortunate to be a part of was the fact that now, uh, For internet businesses, payments is actually part of the strategy that matters. It's part of the product experience. And so basically, I think this used to be a fairly tactical vendor decision for the business, where it was just something that needs to be taken care of, and there was only downside, really. You could make a bad choice, but you couldn't make a great choice. Whereas now, as we've seen with companies like Amazon, like Lyft, like Instacart, They can actually win based on their product experience, and that's new.

AI assessment note: “developers were just really glad that someone was finally paying attention to them”

Q Did anybody try to stop you or make life difficult for you, banks or regulators? Because you're dealing with intricate financial regulations, and I mean, and big banks presumably have a big interest in this. This could be a revenue stream for them. Like, Did, were there people who tried to, or was it just once you started, you just, the momentum was, the wind was behind you?

A Well, in this department, we really tried, tried to approach things differently to, I think, how technology companies often tend to. Uh, technology companies, I think, often have a sort of go it alone mentality. We'll build it all in-house. We'll do it all ourselves. We can do things better than ever in the outside world. Whereas we thought that Stripe would only be possible, and it would only be possible to do it well. If we partnered closely with people who had deep expertise and experience in industries that we ourselves were less familiar with. And so from the very beginning, even before we launched, we partnered closely with banks, and now we work with banks in, you know, many different countries. And not just banks, but sort of other financial institutions besides. But we really wanted to build Stripe as sort of a, you know, multi-decade thing.

AI assessment note: “from the very beginning, even before we launched, we partnered closely with banks”