Friday, August 04, 2017

Damn, wish I’d remembered to be a genius entrepreneur

If you do any spending on the Internet – and that would be pretty much everyone – you’ve no doubt used Stripe. Unlike the flashy consumer-facing companies – think Uber – Stripe operates behind the scenes.

Stripe is the brainchild of brothers Patrick and John Collison who were barely out of their teens when they decided to do something about the clumsy, old and creaky ways in which the Internet’s financial infrastructure operated, building:

software that businesses could plug into websites and apps to instantly connect with credit card and banking systems and receive payments…

The company now handles tens of billions of dollars in internet transactions annually, making money by charging a small fee on each one. Half of Americans who bought something online in the past year did so, probably unknowingly, via Stripe. (Source: Bloomberg)

The company’s valuation is $9.2 billion, making the Collison brothers billionaires.

There are questions about how realistic this valuation is, but – when it comes to Internet companies – that’s not exactly news. And few are betting against them.

What’s interesting about these fellows to me isn’t so much that they’re boy billionaires. It’s their back story.

They grew up in a pokey Irish village with the brilliant name of Dromineer, where their father (switching careers from electrical engineering) ran a small hotel on Lough Derg. When I saw this, I got all jazzed, as Lough Derg is a famous pilgrimage site, where penitents walk around barefoot on a rocky island in the wet and col, and have nothing to sustain them over the course of their pilgrimage beyond dry bread and tea. Alas, there are two Lough Dergs in Ireland, and the Collison Lough Derg is touristy, not pilgrimage-y. (Mom also had an interesting career track, moving from microbiology to running a corporate training company.)

Anyway, the brothers Collison were bred to be entrepreneurs.

But mostly they were bred to be geniuses.

While in school, teachers let Patrick read books in class when he was bored. He did some study-at-home, and managed to take the standardized Irish leaving cert tests, usually taken over a two-year stretch, in less than three weeks. Naturally, he aced all 30 exams. (And, to celebrate, ran a marathon.) Meanwhile, he’d been named Ireland’s Young Scientist of the Year “for developing a programming language and artificial intelligence system.”

Based on the scores of SATs he took when he was 13, Patrick crossed the pond to study at MIT.

John was no stupe, either. He went to Harvard.

When the brothers weren’t being students, they created iPhone apps,

One of their first hits was an $8 version of Wikipedia that people could search offline—the brothers stripped out superfluous coding so the whole thing could fit in a downloadable file. They also helped create a way to manage EBay auctions and sold that company, Auctomatic Inc., for $5 million in 2008. 

Like fellow genius entrepreneurs like Bill Gates and Mark Zuckerberg, the boyos dropped out of college. Like Zuck, they moved to California and built Stripe.

A PayPal investor, Mike Moritz, who saw them in action had this to say:

“They have the advantage of coming to California without being tainted and polluted by what’s in the water supply and air of Silicon Valley,” says Moritz, a partner at Sequoia Capital and a Stripe board member. “They’re more humble and well-rounded. There’s such an improbability to their story—that these brothers from a little village would come to build what could well be one of the most important companies on the internet.”

Speaking of PayPal, Stripe has plenty of competitors, and transaction processing is a highly competitive, low margin, cutthroat business. Stripe has cut out a nitch with Internet startups, and is also cutting deals with Amazon and some direct merchants. Stripe now has over 700 employees. And the Collison brothers are spending their time trying to expand their footprint in Internet infrastructure.

The wallpaper on his [Patrick’s] computer displays a countdown clock for his life: He has 52 years and a few days left. “This is a very coarse estimate, but it’s a reminder that you get old quickly,” he says, a touch of gray now in his red hair. “When you talk to people who are old, some wish they had enjoyed themselves more, but not many wish they had wasted more time.”

That’s for damn sure, at least in my case. There’s no doubt, when I’m about to start death rattling, I’ll look back on those hours whiled away watching “Tiny House” and playing Tai-Pei, and think, damn…I know what I was doing, but what was I thinking?  

The Collisons don’t waste time consume pop culture or watch TV. Patrick admits:

If I had infinite time, I would watch it. This might be the entirely wrong optimization.”

Instead, the brothers spend their time studying topics that interest them – e.g., law (John) and physics (Patrick). They’re pilots, and runners.

During company runs, Patrick lags behind to hang with the slowest person. Sometimes, John hands out pancake bundles at the end of early-morning jogs.

Well, how endearing is that?

There’s more of course. The Bloomberg article has a lot more on the brothers, and the payment biz. All pretty interesting.

Anyway, I loved reading about these guys. Mostly, I suppose, because they come from the back arse of nowhere in Ireland. And because they’re such colossal nerd boys.

Makes me wish that I’d remembered to be a genius entrepreneur.

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