The Stripe Ecosystem in One Giant Visualization
It seems Stripe is living up to the hype.
The fintech unicorn was just revalued at $9 billion after its latest round of funding led by General Catalyst Partners and CapitalG, the investment arm of Google’s parent company Alphabet Inc. The new financing, which almost doubled Stripe’s valuation, occurred despite a general slow-down in venture capital funding over recent months.
Why are investors doubling down on Stripe? It’s because the company seems poised to continue revolutionizing online payments, and it’s creating a ripple effect that is spreading throughout the entire e-commerce landscape.
The above infographic, courtesy of payment analytics software Control, gives insight into the rapidly evolving Stripe ecosystem – a key differentiating factor that investors are banking on with this five-year-old startup.
Breaking the mold
As is often the case with game-changing companies, Stripe was born out of frustration. Co-founders John Collison and Patrick Collison created the payment-processing platform after seeing an opportunity to improve the cumbersome online payment experience not just for entrepreneurs, but also for web developers and customers.
Stripe lets business owners set up an online payment system and start accepting payments in as little as 10 minutes, with a process that’s as simple as embedding a line of code.
Cutting Red Tape
To fully understand how freeing this is for business owners and web developers, consider how limited online payment processing used to be.
Traditionally e-commerce companies accepted payments online by connecting with third-party software such as PayPal, or by spending time and money setting up a merchant account and building a network for securely storing sensitive credit card information. While larger companies with teams of developers could do this, smaller companies were limited in their options.
Furthermore, setting up a merchant account required an arduous waiting period – sometimes even months – before approval could be granted and payments could be accepted. Once payments were processed, they were subject to days-long holding periods while they were put through various levels of regulatory bureaucracy.
How Stripe Works
Stripe is a PSP (Payment Service Provider) that lets business owners collect payments, including recurring payments, and transfer them directly to their own account instantly.
It does this by eliminating the need to store credit card information, which is what limited business owners before. Previously, when setting up an internal online payment system, web developers had to adhere to strict regulations surrounding the storing of credit card information, as per the Payment Card Industry’s Data Security Standard (PCI DSS). This is a complicated process that often requires a lot of paperwork and costly third-party consultation.
While any business or individual merchant collecting or handling credit card information is still required to maintain PCI-compliance, Stripe takes care of a lot of the legwork. Customers can enter their credit card information, which goes directly to Stripe’s secure servers, so site owners don’t have to store sensitive user data. Stripe processes the payment, checks for fraud, and takes a fee of 2.9% plus 30 cents. Business owners see the money in their bank account instantly, rather than having to wait days for clearance.
To customers, the payment experience is much the same, but faster and without the need to leave a current web page to visit a third-party page – as is the case with PayPal.
The Stripe Ecosystem
Perhaps one of the most unique aspects of Stripe is the ease with which web developers can build their own integrations that can merge with Stripe’s technology to fulfill other business requirements.
In many ways Stripe is like a giant lock into which web developers can insert their own custom-built “key”, unlocking a payment process that’s tailored to e-commerce. This has created a third-party integration ecosystem that spans nearly every aspect of running a business, from analytics to accounting, email, expenses, and shipping processes.
The best part? The massive Stripe ecosystem is accessible to anyone who uses the platform to run their online payment processing, and it truly allows developers and entrepreneurs to better serve their customers.
Big Players are Switching to Stripe
While Stripe was created with small business owners and startups in mind, recently some very big fish have joined forces with the payment processing platform, including Facebook, Lyft, Slack, Macy’s, and Target. With users in 110 countries and a recent foray into Asia, Stripe is now considered PayPal’s main competitor.
It’s no surprise then, that PayPal alumni saw Stripe’s potential early on. That’s why PayPal co-founders Elon Musk, Peter Thiel, and Max Levchin have all invested in the now $9 billion payment startup.
Ranked: America’s 20 Biggest Tech Layoffs Since 2020
How bad are the current layoffs in the tech sector? This visual reveals the 20 biggest tech layoffs since the start of the pandemic.
Ranked: America’s 20 Biggest Tech Layoffs This Decade
The events of the last few years could not have been predicted by anyone. From a global pandemic and remote work as the standard, to a subsequent hiring craze, rising inflation, and now, mass layoffs.
Alphabet, Google’s parent company, essentially laid off the equivalent of a small town just weeks ago, letting go of 12,000 people—the biggest layoffs the company has ever seen in its history. Additionally, Amazon and Microsoft have also laid off 10,000 workers each in the last few months, not to mention Meta’s 11,000.
This visual puts the current layoffs in the tech industry in context and ranks the 20 biggest tech layoffs of the 2020s using data from the tracker, Layoffs.fyi.
The Top 20 Layoffs of the 2020s
Since 2020, layoffs in the tech industry have been significant, accelerating in 2022 in particular. Here’s a look at the companies that laid off the most people over the last three years.
|Rank||Company||# Laid Off||% of Workforce||As of|
Layoffs were high in 2020 thanks to the COVID-19 pandemic, halting the global economy and forcing staff reductions worldwide. After that, things were steady until the economic uncertainty of last year, which ultimately led to large-scale layoffs in tech—with many of the biggest cuts happening in the past three months.
The Cause of Layoffs
Most workforce slashings are being blamed on the impending recession. Companies are claiming they are forced to cut down the excess of the hiring boom that followed the pandemic.
Additionally, during this hiring craze competition was fierce, resulting in higher salaries for workers, which is now translating in an increased need to trim the fat thanks to the current economic conditions.
Of course, the factors leading up to these recent layoffs are more nuanced than simple over-hiring plus recession narrative. In truth, there appears to be a culture shift occurring at many of America’s tech companies. As Rani Molla and Shirin Ghaffary from Recode have astutely pointed out, tech giants really want you to know they’re behaving like scrappy startups again.
Twitter’s highly publicized headcount reduction in late 2022 occurred for reasons beyond just macroeconomic factors. Elon Musk’s goal of doing more with a smaller team seemed to resonate with other founders and executives in Silicon Valley, providing an opening for others in tech space to cut down on labor costs as well. In just one example, Mark Zuckerberg hailed 2023 as the “year of efficiency” for Meta.
Meanwhile, over at Google, 12,000 jobs were put on the chopping block as the company repositions itself to win the AI race. In the words of Google’s own CEO:
“Over the past two years we’ve seen periods of dramatic growth. To match and fuel that growth, we hired for a different economic reality than the one we face today… We have a substantial opportunity in front of us with AI across our products and are prepared to approach it boldly and responsibly.”– Sundar Pichai
The Bigger Picture in the U.S. Job Market
Beyond the tech sector, job openings continue to rise. Recent data from the Bureau of Labor Statistics (BLS) revealed a total of 11 million job openings across the U.S., an increase of almost 7% month-over-month. This means that for every unemployed worker in America right now there are 1.9 job openings available.
Additionally, hiring increased significantly in January, with employers adding 517,000 jobs. While the BLS did report a decrease in openings in information-based industries, openings are increasing rapidly especially in the food services, retail trade, and construction industries.
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