Stripe Revenue and Market Share in 2023
Stripe is a payment processor launched in 2010 for online transactions. The company is one of the highest-valued privately owned businesses in the US.
Stripe offers a highly customizable API as well as pre-built checkout pages, which can be used to take payment from customers. It provides additional features like fraud prevention and recurring billing.
In this article, we’ll look at the statistics around Stripe and what makes it an exciting young company.
Stripe Revenue Key Information
Stripe was founded by Irish brothers Patrick and John Collison in 2009. The company has been backed by 54 investors, including early backers like Elon Musk, Peter Thiel, and Sequoia Capital.
The company has raised $2.3 billion in funding over 20 rounds. It is considered a unicorn startup, a term reserved for companies valued at over $1 billion.
In terms of valuation, Stripe is one of the highest-valued privately owned businesses in the US. The company was last valued at $95 billion in 2022 by investors. Stripe revenue rapidly expanded during the pandemic. However, it does not expect this growth to be replicated in the coming years.
Internally, Stripe lowered its valuation by 38% to $74 billion. This decision came from a 409A valuation which is set by a third party rather than venture investors. Public companies, particularly in the technology industry, are experiencing a decline. Stripe remains profitable despite the lower internal valuation.
Stripe is a developer-friendly way to accept payments online. It comes packed with additional features like Stripe Radar which helps businesses fight against online fraud.
PayPal and Square are two of Stripe’s most significant competitors for a share of the payment processing market. The company with the biggest market share is PayPal. Stripe is aimed at businesses of all sizes, whereas PayPal is geared towards smaller businesses.
Stripe Revenue Up 60% in 2021
Stripe revenue has seen steady increases year on year. The company makes its money from taking a cut of transactions, 2.9% + $0.30 per successful charge for most cards. It also charges extra for international transactions and currency conversions. Its fees are lower than its main competitor PayPal.
The company experienced a significant increase in revenue in 2020 and 2021 as a result of the pandemic. With more people shopping online and using contactless payments, Stripe’s revenue grew by 60% in 2021.
In previous years its revenue was:
- 2016: $450 million in revenue
- 2017: $1 billion in revenue
- 2018: $1.5 billion in revenue
- 2019: $2 billion in revenue
- 2020: $7.4 billion in revenue
Stripe’s growth can also be attributed to the success of its product and the company’s focus on providing a developer-friendly service. The founders of Stripe are not expecting the growth to be as significant in 2022. They believe that the past two years resulted from a one-time behavior growth brought on by the pandemic.
As lockdown restrictions have been eased and countries have returned to some sense of normality, the growth in ecommerce will likely slow down. This doesn’t mean that Stripe won’t continue to grow, but rather that the company is realistically expecting more modest growth in the coming year.
Stripe Has a 19.44% Market Share
The payment processing market is hotly contested, with many companies vying for a share. In terms of market share, PayPal is the clear leader with 42.02%. Stripe takes the second spot with a 19.44% share of the payment processing market. 229,894 companies use Stripe, including some of the world’s leading brands like Target, Samsung, and The Home Depot.
The market share of the top 5 companies in payment processing is as follows:
- PayPal has a 42.35% share
- Stripe has a 19.44% share
- Shopify Pay Installments has a 12.42% share
- Amazon Pay has a 4.76% share
- Afterpay has a 2.13% share
As more companies turn to digital trading, the market share of these companies will likely change. Stripe has been growing rapidly, converting PayPal merchants looking for a more bespoke checkout experience. With its recent acquisitions and partnerships, the company is in a strong position to compete for a larger share of the market.
Stripe’s Growth Exploded Due to the Pandemic
The pandemic caused shoppers and merchants to flock online, which gave Stripe a significant boost. A record number of businesses choose Stripe as their online gateway, with an average of 1,400 companies joining them every day in 2021. Growth is expected to slow in 2022 as the pandemic recedes and life returns to normal.
Stripe’s future is still bright, as 60% of all new startups are choosing its services instead of its competitors. The company also provides premium features, such as subscription billing and invoicing, which helps it increase its revenue.
The entire payment processing industry is forecast to grow to $147.4 billion by 2027. This is a compound annual growth rate (CAGR) of 10.1%. Stripe is expected to maintain its position as one of the leading providers in the industry.
One area that Stripe is focusing on is the creator economy which it sees as a key area of growth. The company has made a number of acquisitions in this space, including Indie Hackers, a platform connecting entrepreneurs with experienced mentors. Looking to the future, Stripe plans to help creators monetize their work and build sustainable businesses.
Stripe’s Historic and Current Valuation
Stripe is the highest-valued venture-backed private company in the US. It ranks third in the world behind only the Chinese technology companies ByteDance, which owns TikTok, and Ant Group, which owns the mobile wallet Alipay.
Founded in 2010, Stripe is currently valued at $95 billion by venture investors. Stripe has raised a total of $2.2 billion from investors following its Series H funding round. Lead investors in this round include Sequoia Capital, AXA group, Allianz X, and Fidelity.
Stripe’s previous funding round and valuations are as follows:
Funding round | Money Raised | Valuation |
Series A | $2 million | $100 million |
Series B | $20 million | $500 million |
Series C | $70 million | $1.75 billion |
Series D | $150 million | $9 billion |
Series E | $245 million | $20 billion |
Series F | $100 million | $22.5 billion |
Series G | $250 million | $25 billion |
Series H | $600 million | $95 billion |
Stripe has yet to announce any plans to go public, but if it does, it may come via a direct listing instead of the more typical initial public offering (IPO). A direct listing would allow existing shareholders to sell their shares on the public market without raising any new capital.
Stripe Features and Products
Stripe has a number of features and products available for its merchants. Some features are available for free, while others may come at an additional cost. Stripe can be integrated with a wide range of website builders and storefronts, including WordPress.
- Stripe Invoicing: With this product, you can send professional invoices from your Stripe account and get paid.
- Stripe Payment Links: Payment links let you send a payment request via email, SMS, or chat.
- Stripe Connect: With Stripe Connect, you can accept payments from anyone worldwide.
- Stripe Checkout: Stripe Checkout allows you to install pre-built checkout pages on your website, removing the need for a developer.
- Stripe Radar: Radar is a fraud prevention tool that uses machine learning to stop fraudulent payments before they happen.
- Stripe Atlas: Atlas helps you incorporate your business and open a US bank account.
- Stripe Sigma: Sigma is a reporting tool that lets you create custom reports and dashboards.
- Stripe Billing: Billing allows you to automate your recurring payments.
- Stripe Terminal: Terminal lets you accept in-person payments with a card reader.
Developers can also take advantage of Stripe’s robust API to create custom integrations.
Stripe Customer Facts
Stripe supports businesses of any size, from startups to enterprises. The platform requires some level of developer knowledge, which may make it unsuitable for companies without access to a developer. Some of the company’s biggest customers include Slack, Google, Instacart, Amazon, and Salesforce.
According to BuiltWith, 3,388,191 websites use Stripe for payment processing. Stripe is popular with ecommerce businesses because it offers a seamless checkout experience for customers and a customizable API.
Lyft, a ride-hailing app, was able to use Stripe to introduce an express payout option for its drivers. This feature allowed drivers to cash out their funds in as little as a few hours. This was a major selling point for Lyft as its competitors, such as Uber, took up to a week to pay their drivers.
Stripe merchants can accept payments from 195 different countries. Companies like Kickstarter benefit from this as it allows its users to fund their projects in more areas without restricting their reach.
Stripe’s Payment Methods
Stripe offers a range of payment methods to suit businesses of all sizes. The company supports all major credit and debit cards and popular alternative payment methods, such as Apple Pay and Google Pay. Stripe also offers ACH direct debits for US customers and SEPA direct debits for European customers.
Businesses can use Stripe to accept payments in over 135 different currencies. This is helpful for companies operating in multiple countries or with a global customer base. Stripe automatically converts the funds into the company’s chosen settlement currency for a small currency conversion fee.
How Stripe Makes Money
Stripe charges a 2.9% + $0.30 per successful card charge for businesses in the US. This fee is slightly higher for international transactions, at 3.9% + $0.30 per charge. If your payments need to be converted into another currency, they charge an extra 1% fee for this service. Stripe also has an enterprise pricing plan. This allows for custom transaction fees and is negotiable depending on the company.
If a customer requests a chargeback, there is a $15 fee in every instance, regardless of the outcome. Stripe offers chargeback protection at 0.4% per transaction. Some of Stripe’s other premium products are priced as such:
- Stripe Invoicing: 0.4% – 0.5% per invoice
- Stripe Terminal: $59 – $249 for a card reader + 2.7% +5c per successful card transaction
- Stripe Atlas: $500 one-off free for startup incorporation
- Stripe Sigma: 2c per customer report with bulk discounts available.
Stripe’s revenue primarily comes from transaction fees on credit and debit card payments processed through its platform.
Stripe Investor Facts
Stripe founders Patrick and John Collison took Stripe to Y Combinator in August 2010 for its initial seed funding round. In March 2011, Stripe held a second seed funding round, which attracted investors, including Andreessen Horowitz, Founders Fund, Sequoia Capital, SV Angels, Elon Musk, and Peter Thiel.
Peter Thiel and Elon Musk are PayPal co-founders. PayPal is Stripe’s biggest payment processing competitor. Musk was fired from PayPal in 2000, and Thiel left in 2002 following the sale to eBay.
Sequoia Capital is the most frequent Stripe investor, joining funding rounds at the seed level and at every subsequent funding round. The venture capital firm has invested in some of the world’s most successful companies, including Google, Apple, Yahoo!, and Oracle.
In total, Stripe has held 20 funding rounds. Later investors include:
- Tiger Global Management
- General Catalyst Partners
- Shopify
- Capital Group Private Markets
- American Express Ventures
- Visa
- CapitalG
Stripe reached unicorn status in 2014 when it raised a $250 million Series C funding round, valuating the company at $1.75 billion. The company’s latest Series H funding round occurred in 2021.
Stripe’s Founders Are Brothers Patrick and John Collison
The Collison brothers are natives of Ireland. They started their first business in 2007 when they were teenagers, a software company called Shuppa that merged with Auctomatic. Auctomatic was sold to Live Current Media in 2008, making both brothers millionaires. In 2010, they teamed up again to create Stripe.
Patrick Collison won the 41st young scientist technology exhibition in 2005 at 16 years old. He entered with a project on artificial intelligence. He later dropped out of MIT to work on Stripe full-time with his brother. Patrick founded Fast Grants during the pandemic to help fund COVID-19-related science.
John Collison is two years younger than Patrick. He studied at Harvard University, starting in 2009. He, too, dropped out to work on Stripe. By 2016, the brothers had become the world’s youngest self-made billionaires, with a net worth of $1.1 billion each.
Patrick is the current CEO of Stripe, and John is the President. The brothers retain the controlling interest in Stripe. According to Bloomberg, John and Patrick Collison’s current net worth is $8.29 billion. This makes them the 264th and 265th wealthiest people in the world.
Acquisitions Made By Stripe
Stripe has made several high-profile acquisitions in recent years, including the purchase of Kickoff in 2015.
These acquisitions are part of Stripe’s strategy to build the best possible suite of tools for running an online business. By acquiring Kickoff, Stripe gained a team with deep expertise in creating beautiful user interfaces and mobile experiences. Stripe also bought Index. It gained a team focused on making it easy for businesses to get started with accepting credit card payments.
Both of these acquisitions will help Stripe continue providing its users with the best possible experience. And they underscore the company’s commitment to building the best products for businesses of all sizes.
Here are some of the other notable acquisitions made by Stripe:
- Paystack: Stripe acquired Paystack, a leading payments platform in Africa. This acquisition will help Stripe expand its reach in the African market and provide users with even more payment options.
- OpenChannel: Stripe acquired OpenChannel, a platform that helps businesses manage their app store relationships. This acquisition will help Stripe better serve its developer customers.
- Payable: Stripe acquired Payable, a company that helps businesses meet their tax reporting obligations. Stripe used Payable’s technology to improve its Stripe Connect service.
- TouchTech Payments: Stripe acquired TouchTech Payments, a leading provider of customer authentication. This acquisition helped Stripe prepare for Strong Customer Authentication (SCA).
- TaxJar: Stripe acquired TaxJar, a company that provides sales tax automation. This acquisition will help Stripe customers automate the process of collecting and remitting sales tax.
- BBPOS: Stripe acquired BBPOS, a provider of point-of-sale (POS) solutions. This acquisition will help Stripe provide more comprehensive POS solutions through Stripe Terminal.
- Recko: Stripe acquired Recko, a company that provides transaction reconciliation. This acquisition will help Stripe provide its customers with better reconciliation reporting.
Each acquisition aims to improve the company’s suite of payment tools, focusing on making it easier for businesses to get started and streamline their transactions.
Where Stripe Is at Today: Interesting Stripe Statistics
Stripe’s former CTO, Greg Brockman, was tasked with finding a name. The company was in stealth mode during the early phases of its development, and it was up to Brockman to find the public-facing name. At one time, he had registered domains for paydemon.com and paydaemon.com but went back to the drawing board.
He started to think about single-word nouns and would email the owner of the domain name. One of the names that came back to him was Stripe, which seemed like a positive and catchy name for the company.
Stripe’s original mission was to “increase the GDP of the internet” by making it easy for businesses to accept payments online. The company employs 7,000 people across 23 countries.
Stripe has been granted 70 patents by the USPTO, covering many technologies and business methods. The patents cover payments, computer memory, and payment service provider topics.
A significant portion of the company’s R&D budget is dedicated to continuing to innovate and expand its IP portfolio. This commitment to innovation is one of the main reasons that Stripe has snowballed and become a leading provider of online payment processing services.
Stripe doesn’t consider itself a PayPal competitor. Instead, it sees itself as a company trying to build the infrastructure to enable the next wave of internet companies.
Stripe vs PayPal
Stripe and PayPal are two major players in the online payment processing industry. Both companies offer a variety of features and services that businesses can use to accept and process payments online. PayPal is currently the leading provider, but with innovative alternatives on the market like Stripe, that could soon change.
PayPal benefits from its brand recognition. The company has been on the market longer than its competitors, and its consumer business is well established. This gives PayPal an advantage in getting new businesses on board. Many customers are already familiar with how PayPal works and are therefore more likely to trust using it for online payments.
As an out-of-the-box solution, PayPal is better suited to small businesses that don’t have the time or resources to invest in a bespoke solution. Stripe, on the other hand, is a very flexible platform that can be customized to the specific needs of a business. This makes it a better choice for larger companies that need more control over their payment processing.
Stripe’s API is highly customizable, and its documentation is excellent, making it easier for businesses to integrate the platform into their existing systems. PayPal’s API is not as flexible and can be challenging to work with.
One of the key advantages of using Stripe over PayPal is that it offers support for Apple Pay and Android Pay. This means that customers can make payments using their smartphones, which is becoming increasingly popular. However, Stripe cannot accept PayPal wallet payments, a popular way to pay online.
In order to keep growing, Stripe will need to challenge PayPal for its position as the leading online payment processor.
Summary
Choosing Stripe as your payment provider means you’ll be able to take advantage of its many customization options, its support for Apple Pay and Android Pay, and its excellent documentation.
Stripe integrates with WordPress allowing you to collect payments directly from your website. Kinsta has a one-click installation process for WordPress and WooCommerce where you can connect with Stripe and start collecting payments right away.
Check out our plans here or schedule a demo to see how you can use Kinsta to for Application Hosting, Database Hosting, and Managed WordPress Hosting.