Founders Build Roads, Not Cars | Patrick Collison + Derek Andersen

Limerick is where our next guest Patrick Collison grew up at age 10 Patrick taught himself to code at age 16 he won the prestigious top young scientist award presented to him at the time by the President of Ireland soon afterwards path and his younger brother John came to the US and enrolled in MIT while there they began work with their first startup later moving later moving to the west coast with the support of Y Combinator they partnered with two oxford graduates informed automatic within 10 months this is required for five million dollars so while cylinders teams Patrick and John became millionaires seven years ago the guy who set out to build a claim and payment platform that would enable any company to sell their products anywhere in the world and so stripe was born can you all please be upstanding and get a big startup welcome to Patrick Collison co-founders [Applause] well thank you for being here thanks very much for hanging back again I'm excited to be back here so when we when we we first chatted in 2012 was the first time you used folk at a startup grind and let me let me just say a couple of things if I can about stripe and then and then we'll get to some of the some of the questions but this is not me pandering to Patrick but this is truth in college I sold merchant accounts I was one of those terrible T really yes I did I start up I was like customer service selling merchants 1500 merchant accounts huh terrible and as soon as I heard about stripe people would ask it like I was like wow that model is terrible this is the future and for years people would ask me like if you could go work at any startup what startup would you go to and I always for years I would say stripe because both because of you and John but also the problem you were solving seems so big and so huge that's that's interesting because when we used to describe stripe to people early on the most common reaction by far was kind of blank stares right and that this is sort of weird I don't get oh it's better than any of the existing things I've ever like people really truly didn't did not get it but then people who had dealt with online pins before which is of course in a small minority but feels good does for the first ten we're like wait this is awesome you know this needs to exist ever and so I guess you all seem to get it early on but I realize you had this additional contact what's easy and it's easy now it's easy to look back and say it's obvious right and and and great ideas can be like that but help tell us how has stripes evolved since those early days both both in terms of the products and you know the the customers that you service right right so I think basically we evolved in you know three major axes the first one is just the breadth of products we offer right and we started out with an incredibly limited product offering right you could basically charge you could charge credit cards if your business was in the US in u.s. dollars and really not a whole lot more besides right and that was kind of sufficient that we could kind of get you know some initial traction solid and so on but you know we really weren't doing a whole lot and if you want you to expand your business internationally or if you wanted to sort of do something more complicated than just charging cards like maybe implement a marketplace or but the subscription business whatever you know there wasn't a whole lot that we could do for you this is a lot of just kind of product expansion to cover more functionality that it turns out technology companies want to go and take advantage of and second axis is it's just making star be available to more businesses and so we started out only available to businesses in the US were now available to businesses in well kind of 25 countries directly and then now through Atlas we've businesses in more than 100 countries and then the third axis is just expanding the kinds of customers to be addressed right in the beginning it was sort of small you know early-stage startups because you know we weren't really a known quantity and so they thought they were taking some degree of risk by building on the stripes whereas now we have public companies and fortune 500 companies and is a really large enterprises to you know migrate their businesses and to sort of the internet digital economy and so increasingly building top of stripes which means for us you know we still kind of we've had to adapt from modern terms of how we deal with them and so on and so it's been sort of the same direction but but kind of progressing on those I would say primarily those three axes how have you changed I know you asked everyone else that well I spend I you see sidle I think we're like I think that's like your shirt is it I'm not a hundred of those sure I'm not one of those people it's written a lot you know that because make so many decisions every day after wear the same clothes on my you know it's not that hard to do the t-shirt but and so I'm I I used to spend all my day writing code right and it's all these photos of airlie stripes on it you know if the headphones on and in my jackets late at night or whatever and just writing code all day and sadly those days and longer exist and so I to my day kind of helping recruit people meeting with people reviewing products and all of that so all that stuff has changes how I've changed I had to get more okay with was not going to live as an introvert I think my inner self what ideally just be holed up you know but by itself myself every day and can't do that how has starting in business in 2011 change versus say starting a business a technology company today what do you think is how is the landscape change in just five or six years it's a good question and you know the obvious answer which kind of everyone will tell you and we all I think know to some degree is kind of in so many ways it's gotten easier right in dieting areas AWS and you petróleo and stripe and you know I think many traditional firms are given law firms and folks like that that sort of come to understand this is an important market instead of adapt to themselves the better service and fee deferrals and things like that a lot of other entities and organizations give various kinds of credits and stuff like that obviously the kind of the incubator accelerator community has has really blossomed and so you know folks like YC 500 startups etc have really broadened their reach and you know even if you're not obviously here in the US I think there's kind of far more on the ground help I think culturally it's changed so that I mean we started a company and you know we weren't we were living in the u.s. at the time right but even when I was in college starting a startup was like a pretty weird thing and that people are like you know were you not able to get a job and where's now I think there's kind of some degree of kind of cultural acceptance around it today I think I was listening to change I think thing that has not changed is I don't think it's substantially easier to define the truly underserved dish and to build a good product or service and I mean that is the core essence of the startup and I don't think that has gotten substantially easier and if anything I think that because of the dominance of the Giants right the Google's the Facebook's the Amazons the the apples and so on you know those are wonderful companies but because because they are so good I think it's kind of like in in the previous generation you had these kind of slightly sleepy ossified tech companies that maybe you know weren't that good at sort of responding nimbly and can i keeping up with the the new kind of competitive threats yeah i think the current generation big tech companies they're actually really good at respond to competitive threats and so i think that that actually makes life a little bit harder for for one or startup and they mate and many of the old ones never evolved and it kind of irrelevant now right right exactly I and but were they were the big companies ten years even just ten years ago totally I think that you know the Jeff Bezos and the Sundar's and the the Zuckerberg and so on like that they're good at these responses they get it I mean they were the usurpers themselves so they understand the mentality and so what part of what we're seeing is much more opportunity and and and and just faster growth honestly outside the US and I think it's in part because you know that dynamic isn't quite as pronounced and in many other parts of the world so I remember very clearly in the early days of stripe that when you launch you launched in you know US dollars was the only currency you accept and I remember I don't think in the comments or in you know message forms or whatever but reading people kind of scolding you guys like well I'm in Australia what am I going to get this and I'm in the UK and I'm you know and I'm here and I'm here and so what's very interesting is like how you get very complicated difficult heavily regulated industry yes and we haven't ever read about stripe like Oh stripe had to you know you know in a huge lawsuit with the with Ecuador or something like that you know like you seem to very methodically move through these different countries and currencies and from the outside looks like a very smooth simple it's obviously not simple but seems like a smooth simple process from a managing and running a company standpoint how did you and your team prioritize we're going to do this and this and this and we're just going to like we know there's money there right now but we need to get to sell first look it's painful right in that most tech product you know you can't offer them globally from day one and maybe you want to localize them more over time or something but you launch Twitter and it is intrinsically global you know from from the start in a way that sort of stripe really as you point out to this acutely wasn't like we read those comments and you know we feel bad right we totally want to serve those those companies and in some way we could like in some case maybe there's some kind of infrastructural things you need to build or you know plug into the local banking whales or whatever but sort of but the main impediment is as you say as sort of you know they're all these kind of you know different local regulatory considerations and ways need to adapt and report and so on and we wish we could do that faster right and you know partially that's sort of us building the internal competency to solve and everything and partially it you know just often we're waiting for local regulators in these countries in factors when particular products and what particular market they're really really excited to launch right now we're just we're waiting on the local regulator to get back with an opinion and now as a happens I am I spoke at YC last week and you know and I get those questions of a lots of different founders you know people were asking and how sort of stripes thought about these regulatory questions given that sort of as a tech company thing so those are going from being pure sort of internet businesses you know the Facebook's the Google's the authors the things that exist purely on the Internet so increasingly entering other sectors you know the Airbnb is in the Ebers and so on we're sort of you actually gets involved in the real world consummate in sort of with that trend I think that people are increasingly having to contend with with regulation and the law and governments and all the rest and so the question of the startup of you know how should I approach it how should I think about it and you know there's people occasionally and sort of you know it's like nod wink better to ask for forgiveness and to seek permission and so on which at least in our domain although I think in quite a number of others as well I don't think that's a good idea and I think that actually the approach of engaging with with government and regulators and actually just kind of buttoning things up pretty well from an early stage that's actually in some ways I think an underrated strategy and then you know our general counsel was one of our first hires of the company and you know we now have a pretty significant internal legal function and it is exactly what you say this methodical and in some ways painful and how long it takes processes gradually getting two complete availablee Michael Morris at Sequoia is famous for not ever selling any stock that he in companies that he that he invests in even Google stock which he still holds to this day right and I can only imagine although I have no inside information of this but that you have had lots of opportunities to sell your company it's a great company it you know and it's you know you're doing an amazing thing what I wonder is why and how have you been able within yourself to say no we're going to keep going I see further because we see this we see people miss that we see people hit again sitting here in 2017 is it's quite obvious and easy to see that this is the future of payments on the internet and but very difficult to see in 2012 very difficult impossible of seeing 2011 when you're in blended iris with your brother coding this thing up so what to you has kept you saying no you know what like I'm going to I'm going to keep going we're going to keep building this thing and and you know what what has done that for you well I I don't think and I don't think I could ever to speak to the broad version of sort of people selling the companies versus not you know because obviously there's so much the kind of company specific about that by then you know it's it's easy to say this is you know the advice is often given you should never sell you should always kind of resist the acquirers and so on you know I think that in many of those cases it probably is actually the right decision to sell either because the trajectory you know eventually was going to peter out for whatever reason or or maybe you can in fact do bigger things at the acquirer like i suspect it was a good decision for you know android to sell to google right or for a keyhole with google maps and marry another gram oh right right um so in a stripe case and i think honestly the main reason is because III think it's the decision if they're kind of the framework were using to make the decision is i is financial one at some point the relevant relative expected values you're going to think it's actually better to sell than to not and that only need to happen what's right then and your soul is done you never make the decision again I think it has to be something sort of deeper and in our case the whole reason we work on it and and this is come from a quite early stage was because we just personally speaking we get really excited about all the new things that are getting created on the international the use of technological phenomena companies products to now possible and we think that sort of stripe can help enable more of them and to sort of increase the success rate of them because they can address bigger markets they can enter countries they weren't it before you business models are possible and it's at that kind of I don't make time to grandiose and saying it's kind of that principle oriented thing but it's it's it's that effect in the world and like you know in 10-15 years how are we going to think about what worthwhile to work on stripe but welcome if I was the eventual financial return I mean you know we hope for sake of effort as a company that it's good but really the main way we're going to assess it is in terms of how much more vibrant is the entire technology sector how much more to do the Internet economy flourish and you know when you think about it that way think that acquisitions it kind of becomes an easier decision where it just it's hard to see how it helps you know first of those goals well said our audience is hugely international and so's yours of you and your brother are from Ireland right outside of bloomer and tell us how did Ireland impact the way that you built your product and run your company and or has it not had an impact well I think stripe all has had you know it's funny a lot of American companies I'm sure many of you here in the audience experienced this we're going to talk a lot about sort of international you know as it's like this the US and then there were these no strange international places outside you know they're read Ragan's and and I think you know fortunately because we ourselves were from international we didn't quite approach it the same way and I guess we just thought it was a freaking bug in stripes that we weren't available instead of every country rather than being this kind of weird interesting long term having you for expansion Andrew the people at the company like from a quite early stage sort of a very significant composition or orientation the composition towards immigrants I don't like to know what the the current stat is but you know last time we counted about about a third of the company was working outside of the country of the birth right and you know and that sort of goes all the way you know to the leadership for our chief business officer and the guy who gives all all of of partnerships you know financial industry of interactions and so on you know he grew up in Honduras um and so I think having that and the culture was helpful and you know we started taking expansion outside the US fixing this bug seriously earlier than we than we otherwise might have I think it influenced our thinking with things like Atlas working that the whole kind of the economy of Ireland these days is very predicated on sort of on being outward looking and figuring out how Ireland can be a really good hub for for global operations right and when you think that atlas but that's essentially exactly what we're doing so we're helping people who might be in you know Egypt tell her what Alice's and I don't know so act was a service we launched a few this month last year that helps you incorporate a company in Delaware so the obviously standard incorporation hub sort of all tech companies here in the US incorporate a company in Delaware I get a US bank account Silicon Valley Bank get a u.s. stripe account you can look up implement some customers all around the world and get sort of tax and legal advice just going to get you off the ground and some hosting credits and some other things like this basically it's kind of all the the basics legal they kind of make the mechanics of the infrastructures you need in order to kind of get off the ground then the crucial detail is you can get all this stuff no matter where you yourself are based right and so you can be an entrepreneur in in Kenya in Egypt in Indonesia in Bolivia right and you can sort of get only containing the US government taxes well this is the thing everyone always goes to the tax question but you know as you well know better than almost anyone you talk to the entrepreneurs in these countries yeah they're not worried about what the tax rate it on the air worry about like can they get this thing off the ground and compete on a level footing on equal plane skills with all these US per say hey you're in Kenya you're in Seattle I'm gonna you know I'm gonna go with this product yeah and like you know if it is you know if you can't sort of compete again on a level footing on an equal playing field you know you go to try try to raise money or to partner with someone else whatever and you know if you're kind of just you know weirdly set up from the vantage point of the investor because you know they don't know you know that particularly goal constructor whatever you know that can be like a huge impediment it's on the rest of the marginal tax rates but like this binary existence purse not right and and you wouldn't be survey at those companies sixty percent of them like sixty tell us they would not have been able to gets filed if not fracas on and so so any I think it seems like that we're sort of in large part informed by the experience in sort of growing up in this very kind of outward looking and you know country is of immigrants yeah and we you know we were happy to be part of that and and our our community loves it and it's obvious why they would love it and you know if I was in you know we've had entrepreneurs all over the world that have signed up through so yeah no I think sort of grinders you know given the de breakfast of local presence you know it's a lot of the same mentality how long what major shifts and trends in entrepreneurs you know an entrepreneurship should we be tracking what do you think if you're starting your company today what are you looking at what are you keeping an eye on then you know I think it's always a little bit difficult to this because the trend in general because yes there are these kind of wins a fashion that sort of blow through the the tech sector but you're generally speaking in these categories it's it's kind of only one or two companies that end up making a kind of long term right and we need to look back at social gaming which of course was you know super hot for a while back a couple years ago or in a social networking for a while and so on you know you generally have a fairly small number of victors and so I think that kind of from the vantage point of the entrepreneur it's better to think about just intrinsically what's a good idea ignoring what's you know currently hot and not only not gravitating towards the things that are presently popular but in fact maybe sort of trying to think of popular current places you get in tech security rubbish right and that is the supplies of a business model level and I we kind of mentioned this but but one that really is very acutely apparent to us right now is actually to and first is again this idea of just tech is going from being a kind of purely tech a purely internet it's really web-based phenomenon sort of in fracking into other industries and so it's digitizing other industries right figuring out how can you take this existing sector the students been done for decades centuries whatever and build the internet-enabled version of us right and that is you know proceeding at a breakneck pace and I'm sure you guys sure many of you here in the audience are kind of working on companies of that nature and I think that's a really promising direction for the foreseeable future because you know there are so many industries and businesses that are going to become kind of significantly different as a result of the injection of technology and generally speaking it's pretty difficult for the incumbents to react to that so that's one second is and tech is now really working a sort of outside of Western Europe and North America right and I think kind of Western Europe North America have not yet woken up to make fact as much as they should but majority of Internet users are of course outside of you know these regions I think in the not-too-distant future so the majority of the like tech company wealth is going to be sort of in companies built outside of these regions and you know again say if you take the US here like a lot of the major markets you know there are I don't know the long-term winners have been kind of defined yet but there's a different pretty well run competent companies addressing this at the major needs there's just like way more open canvas in in these more distant places and and yes they now have sort of you know in depends on the country but sort of smartphone smartphone penetration is generally rising quickly and and you know rapidly reaching saturation point internet connections are rapidly improving the basic infrastructure for commerce in the internet is developing and you know we obviously are sort of trying to a giant stat as quickly as we can and so we again I mentioned as at YC last week the sort of international composition of founders of white sheet and you can see it right there versus it YC is becoming more you know it's less dominated by us founders and so just generally we think that phenomenon and again this comes back to things like Atlas is going to reach a really big deal for you know 10 years to come a lot of growth yeah what how is the Internet commerce evolving and um since like a necessary question for a class um I think that III think that it's ceasing to be about Internet commerce right in a just like again there used to be sort of you know Internet commerce was this weird special thing and occasionally you know you'd order your book or your shoes or whatever on the internet right whereas when you think about you know some a the services to be using our phones or the things we book on our phones and how kind of the nature the the transaction is evolving and it just commerce and then there's kind of legacy commerce for there's no no internationals in it and then there's kind of the the more modern version but I think basically the distinction is dissolving and and you know we sometimes think about it you know with our kind of stripe hats on sort of what fraction of Internet commerce I just kind of striped a dress or support or a napal or whatever but I think at some point in the not-too-distant future we're going to stop thinking about it that way we'll just look at the denominators being global commerce because again that distinction is just becoming less meaningful you work with your brother true you guys never fight like all brothers we have never fought and uh and then that's I don't think about Tommy I'm sorry um the three of us myself John Tommy and well you know I I'm almost two years older right and yeah under your eyes it means I'm right exactly and but no look I mean I think that fine an you look at kind of successful companies right yeah and and you're not calling tribe yet successful yeah we've a long way to go but when you look at the sort of the really kind of top-tier companies and the trajectories they followed it's pretty rare and surprisingly so that the co-founders you know totally yeah remain together right and you know did it's freaking stressful like the thing that no one I wish I had better understood when we started stripe is like you know that when you start a company that's like it doesn't go well if the part doesn't work if you don't get the traction you want whatever so it's going to suck right you're going to all these problems you're really miserable and you know just going to be a tough time what nobody tells you is it if it works the flipside you're also going to have all these problems and you're often gonna be miserable and you're going to be putting out fires and so actually you're like guaranteed misery instead of I either pass and so in that sense you're also guaranteed to co-founder you know I don't quite say stripes but there's going to be significant problems to be solved and tension and challenges and all the rest I think having had you know before we start stripe you know almost twenty years of experience and resolving disputes and and hopefully our mechanisms for doing so became a little bit more sophisticated or at least a little bit more verbal over time but and but but I genuinely think that's you know was a helpful foundation do you do you get angry about the um and I mean because like I've talked to hundreds of founders and you there's something that's very unique about you is you are just you seem so like just even keel and I know you're incredibly passionate about and you can hear it just listening to you talk but like I just like so many founders are just sort of volatile animals you know and we just were high we're low were we're like to having the best day of our lives having the worst day of our lives and that's like by noon and and I like and I think about you sometimes and I think like this is something that's really unique to me about you it's like you just seem to just be sort of steady Eddy as they say it's like like you you I don't know and maybe it's just I haven't seen that maybe you did everything I was like with the punches I get back there you know but I like I just don't see well you know Freud and I think this is a box photo the Yankees itís pretty supposed to have said and a can destroyed that M DM the only people impervious to cycle analysis are the Irish and so you know again maybe I can just say that should chalk it up to my to my origins but and look no no I basically don't get angry and sometimes I wonder maybe I should because you know it's not like people don't do things that I think in sometimes logically no you want to get a right right now oh there's a good interview and but look I think that and I I mean how do you how do you do that like how do you with how do you with all the madness going on right like I just like how do you how do you not get so down how do you how do you not get so up like how do you how do you just sort of is there something you can teach us about the way that you do that that which I feel like is a really unique skill that just a lot of people don't have well I really do wanna tame that it's I don't know that it's necessarily good right I mean I look at other founders and the kind of people I think you had you have in mind and like they're so passionate and fervent and fire-breathing that I'm like you know maybe I should try to cop more fire and and then I said go do it in the mirrors like now it's not working but I I do think that again Facebook I think has the sort of internal and a mantra for these I've heard attributed to the maginot to what degree was really manifested in practice but you know you're never as good as they say you are you know when things are going well and you're never as bad as a sort of claim or sort of criticize you as a sort of being when things are going poorly and I think sort of exactly as you say like the so much happens things things go right things go wrong you know every day inside of the startup again especially if things are going well is just because you know more things are happening over time I think the value of a of an even keel increases and one thing I will say is that so this morning I know we welcome sort of a new class of people to strike you know I sat down with them for an hour and a half to try to describe some of those you know stripes mission and goals and how we can think about the we work together and so on and and something over time that I've come to realize and it's like an incredibly important characteristic in startups it's sort of the right kind of optimism and and this is a little bit different to the even-keel but it kind of per the point we're just discussing where if things go well if you're lucky enough for things to go well you're still going to have all these problems right and so an easy response to all those problems is you look around you're like huh there are so many problems like 7 things are literally on fire right and you're not wrong right those problems really do exist but I think instead of a particular mentality as its kind of required for you can observe those problems you can diagnose and you can prioritize and you can go fix them whatever right and yet somehow sort of maintain the confidence in the belief and the optimism that like well they can be solved they will be solved things be better in the future or whatever right but you can't be you know lego movie everything is awesome about us right because you know if you people are so whistling along cheerily being like everything is great you know and you're completely oblivious to these no smoldering and ashes around you then you know that that's it has its own set of challenges and so something that I now pay much more attention to you know as we think about hiring and all the rest is who has like the right combination of ability to truly spot the problems and unlikely be you know have a very kind of fine attention to detail there but somehow still maintain the optimism I think it's so important because you cannot remain saying if you don't have us and because both optimism and pessimism pessimism startups I think becomes self-fulfilling prophecies and so like it's not just a little more kind of rewarding fulfilling existence you can maintain us but it actually is going to become true over time and again is Pacha learning that I wish I'd come to sooner well and as you said which is a good insight that regardless whether it goes well or not those things are still going to happen absolutely and of course key people's and don't appreciate this enough because you know of course it's in the end try to all the companies that succeed to try to sort of quietly elide those details right and that you know Google is a wonderful spectacular company and like so much crazy stuff happened in the early days of Google but you know together the sort of company history page you know they're not outlining my selling experience at that time that we thought there was a good idea to get rid of all engineering managers which is in fact the thing that happened and so I think kind of because of that people have sort of a way to Rosie I kind of vision inversion of what kind of the the early days of these now very successful companies are like and you know you have all these problems you're like it really exacerbates the imposter syndrome right because you're like well Google and Facebook they were so well-run right for as we can't even do an axe or a wire is he right where's in fact so those those companies were at the time people you know people really worried for them they didn't even know if they were going to make them just because that that's the nature of these things as we just close here could you tell us six years later after starting the company what what part of your mission or what you're doing is most exciting for you right now being causally responsible for having more successful technology companies get started so simple passage also crises very very much [Applause]

Channel: Startup Grind

Views: 30,501

Rating: 4.8763795 out of 5

Keywords: startup grind, entrepreneur, stock trading, how to be an entrepreneur, how to start a business, startup company, startup company tips, startup company ideas, how to be successful in life, startup tips, startup business tips, silicon valley startups, success story, startup advice, patrick collison, stripe, collision, derek andersen, founder, stripe atlas, international, payments, money, founder advice, inspiration, billionaire, motivational, yc, how to get into y combinator, y combinator

Id: WspUowkre7k

Length: 33min 10sec (1990 seconds)

Published: Sat Mar 18 2017