'It doesn't get easier, you just go faster': The 25-year-old co-founder of Stripe tells us about running a $5 billion startup

"You could use many adjectives to describe Silicon Valley, I don't think normal is one of them. I think there is this very nice, if at times dangerous, untethered optimism that exists in Silicon Valley. But it is also what causes some of the issues." - John Collison, co-founder Stripe.

Online payments business Stripe is one of Silicon Valley's most high-profile startups, valued at over $5 billion (£3.25 billion) in a funding round led by Sequoia Capital and featuring Visa earlier this year.

The 4-year-old San Francisco company builds tools for businesses that lets them easily accept and track online payments, managing things like integration with banks and online systems.

Its developer friendly approach has made it hugely popular with the new generation of tech companies and Stripe powers payments for high-profile mobile and web business like ride hailing app Lyft and online grocer Instacart in the US.

Stripe was founded by 2 high-flying Irish brothers, the Collisons - Patrick, 27, and John, 25. The pair are already on their second business, having sold eBay software business Auctomatic for over €3 million (£2.1 million, $3.3 million) in 2008.

The brothers, who hail from Limerick, are now based full-time in San Francisco but Business Insider caught up with John in London during a stop over on his way to the Web Summit conference in London.

John told us about Stripe's progress, including its latest product Relay that lets people sell products through third-party apps like Twitter and Pinterest.

But he also opened up about criticisms of Silicon Valley, competition with PayPal, his view on whether we're in a tech bubble, and what it's like to live and work so closely with his brother. Check out the edited highlights of the talk below.

Business Insider: In terms of Relay, I find the idea of social commerce very interesting. Can you talk about how you see that evolving?

John Collison: Sure. Social commerce sounds kind of out there. However, if you go and talk to literally any retailer out there they will give you the foundational pitch for relay, which is that mobile commerce is really broken right now.

You look at the data - and these are US figures but I think it's pretty similar here - and retailers are seeing 60% of browsing happening on mobile but only 15% of purchasing. If you're a retailer that's kind of terrifying. You're seeing all your customers go to this new platform that performs much worse.

Relay is an attempt to help solve this where merchants can say these are the products that I have available for sale and then apps like Twitter and Shopstyle, which was another one of our launch partners, can build really nice buying experiences. You start out in a tweet, you click into it, you tap buy and that's it.

One of the things we noticed was people spend a huge amount of time in these apps - Twitter, Pinterest - so if they buy one thing, they'll probably buy many, many more things. That's where it all started. [But] it's not just social networks.

BI: In terms of the social aspects you partnered with Twitter, Pinterest - is it Facebook as well?

JC: Yup, we're working with Facebook on some of their commerce stuff.

BI: What about Snapchat?

JC: Any company that is as fast growing as Snapchat and has such engaged users has to be interesting but we've got nothing to share on that.

BI: What metrics can you share on revenues, transaction volumes, and customers?

JC: Unfortunately we don't publish numbers. What we do share is we're in 22 countries and have 10s of 1000s of customers who are in aggregate processing billions of dollars each year.

BI: Anything you can share on growth rates?

JC: No, we don't share that either.

BI: And are you profitable?

JC: We don't share that either.

BI: How many staff do you have now?

JC: 320 or so, it changes literally everyday. The US is our largest market but then we have offices in London, Dublin, Melbourne. The UK is doing really well, it's the second largest market after the US. The kinds of companies that do best on Stripe are tech forward so we have lots of the UK tech companies - Deliveroo, Nutmeg.

BI: Where's your fastest growing market?

JC: The UK is doing very well, it only recently became our second biggest market. Australia is doing really well. If you look at the month-over-month growth rates it's obviously the newer markets - we're beta testing in Mexico, Hong Kong, Singapore. Those will always perform best because the denominator is zero, or close to it.

BI: You guys seem to be doing really well but what are the biggest challenges you face?

JC: Probably everyone says this to you but it's true - hiring. If you think about it we're 300 people now, we'll probably double headcount in the next year. The Stripe we've spent 5 years meticulously putting together, we need another one of those in the next year.

Similarly, adapting the company to work effectively at different sizes is always really a challenge. Stripe will have to be a different company at 100 versus 200 versus 400 people. It doesn't just scale up evenly. You need to think carefully about the balance of the company and how teams work with each other.

When it comes to the product and the market in particular - [long pause] - one big challenge is the world changes so quickly around you. 10 years ago the iPhone didn't exist. Nobody cared about buying on phones. You could buy a Domino's Pizza on your WAP phone but it was very much proof of concept.

You have to continue to earn that success year after year

Similarly, a little over a year ago Apple announced Apple Pay, Google's announced Android Pay. These are awesome but completely new methods of paying for things. I think the challenge for all technology companies is to modify what they're doing to be what the market needs at that point. You see examples of technology companies failing to do this - if you look at eBay they still feel very much like a desktop site. Nokia, the smartphone thing completely passed them by.

It's really easy for technology companies once they've reached a modicum of success to feel very satisfied and rest on their laurels. You have to continue to earn that success year after year after year. There's a quote by a famous cyclist, I think it's Greg LeMond: "It doesn't get easier, you just go faster." I think that's very fitting for a lot of technology companies.

BI: There's a big conversation now about whether we're in a bubble. You guys are obviously one of the unicorns. What's your position on it?

JC: [Long pause] Maybe a few notes. First, I don't think you can say very simply that a company that has raised private money at a certain valuation that it is worth that, because private valuations are of a particular type and they're different to, say, public valuations. You need a bit more understanding of what's going on and I don't think either companies raising money or investors in companies are making a statement that companies are worth that.

I don't think you can say very simply that a company that has raised private money at a certain valuation that it is worth that.

The second thing is, I think there are almost certainly some overvalued companies and some undervalued companies out there. The question you're really asking is, "Is there something systemic?" That's a really hard question, I don't know.

I will say I think there are lots of companies that are generating very real revenues with very real businesses that feel like they'll do completely fine. If you look at Airbnb, they're solving a very real problem. Same with Slack, I would argue same with companies like Stripe. The problems are real and the products are good at solving them.

BI: I've noticed PayPal have recently upped their game. Shoreditch High Street station [local to BI offices and near where we met] is absolutely plastered with adverts for Braintree [PayPal's rival developer-friendly payments business]. Is that something you've noticed and how seriously do you take the threat?

JC: Yeah I've seen the ads. I think … what do I think? [Pause] I think fundamentally people make a decision based on the quality of the product and I think the thing that PayPal, and to some extent Braintree, have been struggling with is what people need - the best tools for setting up a business - they traditionally haven't provided.

They're trying to make sure they stay relevant. Advertising obviously helps with awareness, but if you look at some of the most successful companies they're actually not generally ad-driven when it comes to customer adoption.

BI: You mentioned Apple Pay and Android Pay. Is that something that's having an impact on your business already or something you see developing over time?

JC: I don't actually have overall numbers to hand but we see merchants where Apple Pay is actually a quite significant fraction of their total sales volume. If you look at the effect it has on conversion funnels, it completely eliminates a large data collection step. We are very bullish on Apple Pay and Android Pay.

BI: You recently hired a CFO [Thrive Capital's Will Gaybrick] - are you consciously beefing up the management?

JC: Part of expanding a company is hiring really good managers and leaders. CFO and COO are the ones who make the headlines but I spend a huge amount of my time on hiring. There's loads more hires coming in the pipeline, including some senior ones.

Startups have this contrarian mindset. It's easy to take that too far.

I think it's quite important that companies take a humble posture when it comes to building out teams and look to external experts. I think startups have this contrarian mindset where we came in as outsiders and totally reinvented how this stuff works and now it's great. It's easy to take that too far and boil the ocean and reinvent everything. I think that's really dangerous.

You absolutely want to look to people who are experts in the field and have done it before. When it comes to building successful teams and organisations, that's definitely something you get better at over time. I don't think anyone comes out of the womb knowing how to manage large teams or build out a large organisation.

BI: You raised under $100 million earlier this year - is the next funding event and IPO, and if not, when's the IPO?

JC: I've got no interesting comments about a funding event. We've got no plans for an IPO, no plans for future rounds of funding - we do have plans, just, you know.

What the last round of funding was about for us was we had two really great and very strategic investors to bring on - Visa and American Express, who are obviously very big players in the world of online payments. There's a symbiotic relationship there where we can help them improve the ecosystem online, help more people use credit cards online, and they can help us in achieving that.

BI: Is that a way of saying you didn't necessarily need the money?

JC: I didn't say that, but the thing we were most excited about in the round was to bring them on board as investors.

BI: What's the focus for you now?

JC: I would say it's 3 things. One, Continuing to build our and refine the team. We're hiring and training up a large number of people. Everyone always elides that second detail, which is really important to making an organisation work well and setting people up to succeed.

The second is continually improving the product set. Stripe Connect is doing really well, we're really happy with it. If you start an online marketplace tomorrow Stripe Connect is by far and away the best way to do that. Relay is just out the gate and we're still collecting data on that but the problem is totally apparent.

Third is international expansion. We're Latin America and moving further into Asia.

BI: You're 25 now, do you still feel young by Silicon Valley standards? Is it fairly normal out there?

JC: You could use many adjectives to describe Silicon Valley, I don't think normal is one of them. I think there is this very nice, if at times dangerous, untethered optimism that exists in Silicon Valley. But it is also what causes some of the issues. I didn't answer your question.

BI: But that's interesting, what issues do you see in Silicon Valley?

JC: I think you see this class of problems where the innovations that come out of not just Silicon Valley but also London - tech hubs everywhere - have rippling effects on the real world. Uber vs. the taxi companies is an obvious example of this. What I mean by untethered optimism is Silicon Valley is very focused on the upside and at times less connected to the downside.

BI: It seems like some of these guys have their head in the clouds and they don't seem to be willing to engage with, say, a taxi driver who has lost 50% of his business because of your product.

JC: Right. I wouldn't say that in particular as that one [the situation with Uber] is pretty complex, but that is the struggle.

I guess my point is that [the untethered optimism] is what makes Silicon Valley so good, but it's also a reasonable criticism that it is producing so much change, which has positive and negative effects all kind of mixed up.

BI: My original question was going to be how easy do you find it to lead a normal life? Do you ever wish you were just a normal 25 year old, if there's such a thing?

JC: Yeah I would question the premise of that. I feel very lucky in that Stripe is a problem that I think is really worth while to be working on. I enjoy working both day-to-day and long-term. I find it really fulfilling.

BI: Finally, what's it like working and living with your brother?

JC: I get on fine with my brother! It's useful when you're working on a company with people in general to have a level of trust that lets you have a productive working relationship. That's even important in companies where the management are not brothers. I think the most useful thing about it is we're able to spend all of our energy on moving the company forward.