Stripe Analysis

The Business Model Canvas

Key Partners

  • Stripe’s partners consist of the dozens of companies that enable customers to accept and manage payments using its service.
  • These include firms in the following areas: Accounting, Analytics, Booking & Ticketing, Card Readers & POS Systems, CRM, eCommerce, Electronic Signature, E-mail Marketing & Dunning, Financing, Form-Building & Software Tools, Fundraising & Marketplaces, Gift Certificates, Installments, Inventory Management, Invoicing, Mobile Payments, Notifications Recurring Payments, Referral Marketing, Relay, Shipping, Transaction Monitoring, and User Management

Key Activities

  • Stripe’s business model entails maintaining a common platform enabling transactions between two parties: merchants and consumers. The platform includes its website and mobile apps.

Value Proposition

  • Stripe offers three primary value propositions: price, accessibility, and convenience.

Customer Relationship

  • Stripe’s customer relationship is primarily of a self-service, automated nature. Customers utilize the service through the main platform while having limited interaction with employees. The site offers a Help section with answers to numerous potential questions. That said, there is a personal assistance component as users can contact support staff through an e-mail form.

Customer Segments

  • Consumers: This segment consists of individuals, who can make purchases and set up recurring payments.
  • Merchants: This segment consists of businesses, who can accept web and mobile payments from consumers.
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Key Resources

  • Stripe’s main resource is its proprietary software platform, which connects merchants and consumers. As a relatively new startup, it depends heavily on financial resources from investors. As of 2016, it has generated $280 million in seven rounds of funding from 18 investors, who include Sequoia Capital, General Catalyst Partners, Founders Fund, and Thrive Capital.

Channels

  • Stripe’s main channel is its website, through which it markets its offering and makes it available for use. It also offers a mobile app, Stripe Dashboard, through which customers can access the service; they must already have an existing account through the website.

Cost Structure

  • Stripe has a cost-driven structure, seeking to reduce expenses through significant automation and low-price value propositions. Its biggest cost driver is transaction expenses, which largely consist of the costs incurred to accept a customer’s funding source of payment. Other major drivers are in the areas of customer support/operations and sales/marketing.

Revenue Streams

  • Transaction-Related Revenues
  • Service-Related Revenues

SWOT

Strength

  • Both Stripe and Paypal provide payment processing services to help you accept money through your website. But in my opinion, Stripe is easier to use and understand, simpler to setup, more flexible, and better value for about the same price as Paypal.
  • process payments directly on your site without the headache of complex payment gateways, merchant bank accounts, and PCI compliance
  • secure interaction with Stripe servers keeps your customers' data safe
  • seamless checkout experience within your own site means increased conversions and/or sales
  • easier integration, setup, and maintenance
  • others at: http://robmclarty.com/blog/stripe-vs-paypal
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Weakness

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Opportunities

  • In 2007, when the brothers were coding their APIs, online payments were supposed to have been solved. Elon Musk, Peter Thiel and Max Levchin founded PayPal in 1998, which was bought by eBay in 2002 for $1.5 billion. The fintech ‘revolution’ that followed, however, wasn’t much of an uprising but more of a spot of portfolio diversifying by some banks that laid down the payment rails any eager startup had to ride on. The banks still verified identity and owned the account for cards and payments drew from.
  • For years, the growth in e-commerce outpaced the underlying payments technology: companies wanting to set up shop had to go to a bank, which processes payments, and setup a gateway to connect the two. This takes weeks, lots of people, and fee after fee. Much of the software in place was decades old and written by banks, credit-card companies and financial middlemen.
  • Paypal – designed to simplify payments – actually made this worse. The company infuriated startups with its restrictions – once turnover hit a certain level, Paypal automatically put the business on a 21 to 60 day rolling reserve, meaning that up to 30 per cent of a company’s revenue could be locked up for up to two months. Developers had to choose between this and complex legacy systems built by banks.
  • from: https://www.wired.co.uk/article/stripe-payments-apple-amazon-facebook
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Threats

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Porter's 5 Forces

Threats of New Entry

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Threats of Substitute Products

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Competition
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Bargaining Power of Customer

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Bargaining Power of Supplier

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PESTEL

Politic

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Economy

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Social

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Technology

Environment

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Legal

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Business Model Canvas

Value Proposition

  • Stripe offers three primary value propositions: price, accessibility, and convenience.

Revenue Stream

  • Transaction-Related Revenues
  • Service-Related Revenues

Cost

  • Stripe has a cost-driven structure, seeking to reduce expenses through significant automation and low-price value propositions. Its biggest cost driver is transaction expenses, which largely consist of the costs incurred to accept a customer’s funding source of payment. Other major drivers are in the areas of customer support/operations and sales/marketing.

Key Resources

  • Stripe’s main resource is its proprietary software platform, which connects merchants and consumers. As a relatively new startup, it depends heavily on financial resources from investors. As of 2016, it has generated $280 million in seven rounds of funding from 18 investors, who include Sequoia Capital, General Catalyst Partners, Founders Fund, and Thrive Capital.

Key Partners

  • Stripe’s partners consist of the dozens of companies that enable customers to accept and manage payments using its service.
  • These include firms in the following areas: Accounting, Analytics, Booking & Ticketing, Card Readers & POS Systems, CRM, eCommerce, Electronic Signature, E-mail Marketing & Dunning, Financing, Form-Building & Software Tools, Fundraising & Marketplaces, Gift Certificates, Installments, Inventory Management, Invoicing, Mobile Payments, Notifications Recurring Payments, Referral Marketing, Relay, Shipping, Transaction Monitoring, and User Management

Key Activities

  • Stripe’s business model entails maintaining a common platform enabling transactions between two parties: merchants and consumers. The platform includes its website and mobile apps.

Customer Segments

  • Consumers: This segment consists of individuals, who can make purchases and set up recurring payments.
  • Merchants: This segment consists of businesses, who can accept web and mobile payments from consumers.

Channels

  • Stripe’s main channel is its website, through which it markets its offering and makes it available for use. It also offers a mobile app, Stripe Dashboard, through which customers can access the service; they must already have an existing account through the website.

Customer Relationship
  • Stripe’s customer relationship is primarily of a self-service, automated nature. Customers utilize the service through the main platform while having limited interaction with employees. The site offers a Help section with answers to numerous potential questions. That said, there is a personal assistance component as users can contact support staff through an e-mail form.

Monopoly Characteristic

Proprietary Tech

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Network Effect

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Econ. of Scale

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Branding

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7 Questions of Business

Engineering Question

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Timing

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Monopoly

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People

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Distribution

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Durability

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Secret
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June 8, 2017 Notes

How two brothers turned 7 lines of code into a $9.2B startup
  • Patrick and John Collison
  • Debug the process
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