I can save the economy, says 22-year-old Stripe internet tycoon John Collison
Oscar Williams-Grut meets John Collison, who is well on his way to a second web fortune
Sunday 07 July 2013
When a 22-year-old says he can help Britain's economy to get back on its feet, most people would laugh at the precocity, let alone take any notice. But when that 22-year-old has built a $500m (£340m) e-commerce company backed by the founders of PayPal and was a self-made millionaire in his teens, then he suddenly seems a little less cocky.
Irish lad John Collison thinks Stripe, the online payment tool he built with his 24-year-old brother Patrick, could kick-start a generation of British internet businesses in the UK when it launches here later this year. The Limerick-born siblings have built up Stripe in the US over the past three years and are now looking to conquer the other side of the pond.
The problem that he and his brother spotted when building their latest business is the difficulty in accepting payments online. A natural heir to PayPal, Stripe lets web developers quickly and easily receive money through the web.
What sets it apart from PayPal is that Stripe allows customers to complete purchases on the same website, rather than sending them to an external site.
"It's kind of absurd when you think about it," Collison says in a California-tinged lilt. "Imagine you were at Pret [a Manger] and they were, like, 'That'll be £3.99 for the coffees, you just need to go down to the bank and put £3.99 in our account and come back and pick them up.' That's literally what we're doing in the online world."
The firm charges a base rate of 2.9 per cent plus 30 cents on each transaction, with a sliding scale for bigger businesses. Despite being just three years old, the business is already processing millions of dollars each day.
"Because it's so general, we have, like, a cheese shop in Brooklyn, marketplaces, software companies, such as Foursquare and Wal-Mart's software division – all these completely different use cases [types of businesses]."
Collison has a boyish enthusiasm for problem-solving and a bright, relentless energy about him. When not tinkering with his half-a-billion dollar company the Harvard graduate is an amateur pilot, and is the type of person who could spend a week toying with a chemistry set before asking questions that a professor would struggle to answer.
"When a country doesn't have a good economic infrastructure, that harms the country," says the animated Collison. "With Stripe the idea is that by providing better infrastructure, by linking the internet economically, by making it easier for these online businesses to exist, it'll make the web better."
It's hard to believe, but Stripe isn't the Collison brothers' first successful business. The pair helped to build a marketplace management system for sellers on eBay and Amazon that took them to Silicon Valley and turned them into millionaires aged just 17 and 19.
It was their experience with this business that gave them the idea for Stripe.
"People really liked it and they wanted to pay us and they were, like, 'Here's my credit card, charge me money.' Accepting money from these people was a huge pain in the ass, so we thought, OK, let's make this simpler."
The brothers started working on a solution in their spare time while John was at Harvard and Patrick at MIT. During the summer break they moved to Silicon Valley to devote more time to the project, and it soon gathered momentum.
The co-founders of PayPal, Peter Thiel and Elon Musk, both spotted Stripes' potential and were early backers of the business. Collison says Thiel shares their lofty ambition to "make the internet better".
The company recently opened a four-man office on Clerkenwell Road in London that will act as a European headquarters, and the service is currently being tested in London, slated for a UK launch later this year.
Collison is hoping it will make a big impact. For once his mile-a-minute speech stops and he furrows his brow for a moment, before saying: "You know the way trees break through the canopy in the rainforest and they go from having this tiny column of light to having all this light – the internet is kind of like that.
"With Stripe, people who previously operated online or offline in a very limited capacity now have all the tools to work like a real online business. That's a very valuable thing."
As Stripe expands, Collison is hoping his business can help to unlock this value, letting Britain's cheese-shops get online and rub shoulders with the Amazons and the eBays.
Whizz kids of the internet
Nick D’Aloisio, 17, Summly Wimbledon teenager D’Aloisio started writing apps at the age of 12, and at 15 he created Summly, an app that condenses text into either 1,000, 500, or 140-character summaries. Stephen Fry and Yoko Ono invested in the app, which was sold to Yahoo earlier this year for a reported £19m.
Jamal Edwards, 22, SB.TV Edwards started SB.TV in 2006 filming rap freestyles on a handycam, before uploading them to his YouTube account. Seven years on, the network has attracted over 100 million views and Edwards has collaborated with brands such as Adidas and Sony. He was ranked 42 on the Sunday Times Young Rich List.
Bryony Cooper, 27, T Dispatch Cooper’s second start-up, T Dispatch, is a cloud-based taxi dispatch and fleet-management service. Operational for just one year, the business already has around 150 customers, including the AA, and has clients on every continent. The business has raised £500,000 and is currently working on a project with the train company Greater Anglia.
Andrew Brackin, 19, Bunchy Brackin is the only Brit to this year receive a ‘Thiel Fellowship’, a $100,000 grant from the co-founder of PayPal Peter Thiel. Brackin founded Bunchy, which lets users create funding pages, and cofounded Tomorrow’s Web, a conference for web-focused creatives.
James Gill, 22, GoSquared Founded in 2006 by Gill and his three friends while they were doing their GCSEs, GoSquared is an analytics tool that lets firms monitor how people are using their websites. Gill and his co-founders were approached by venture capitalists who wanted to put £100,000 into the business a week before they planned to go to university.
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