Stripe: Platform of Platforms

Stripe Treasury is “a banking-as-a-service API that lets you embed financial services in your marketplace or platform.” Simply, by writing a few lines of code, platforms can let their customers set up bank accounts at partner banks like Goldman Sachs and Evolve Bank & Trust.

The point is context — by abstracting a core function and delivering it in situ, value is created. That is achieved by removing friction or utilizing unique data. Shopify is the canonical example. In recent years, the e-commerce platform has moved beyond integrating Stripe to offer a range of embedded products, including merchant lending that uses ... See more

In a decade, Stripe has gone from accepting payments, which is now a commodity business, to providing an increasingly comprehensive suite of products that make it easy to start and run an online business.

While it’s hard not to love Stripe and its operational excellence, they're often not the sole payment processor a company uses. Companies with scale tend to integrate with a handful of payment processors, gateways, and banks to manage payment inflows and outflows through a distributed architecture. On top of integrating across many payment systems,... See more

A new set of platform players are emerging that follow a similar pattern. Much as Plaid allowed consumers to make their bank transaction data available to fintechs, these new platforms are giving fintechs access to payroll, insurance, credit, and ERP data.

Despite strong technology players like Stripe, Square, PayPal, and Robinhood, traditional banks are still dominant.

A subtext to last week’s article, Tech’s Two Philosophies, was the idea that there is a difference between Aggregators and Platforms; this was the key section:It is no accident that Apple and Microsoft, the two “bicycle of the mind” companies, were founded only a year apart, and for decades had broadly similar business models: sure, Microsoft licen... See more