Inside Stripe: Stablecoins, AI, and (not) Going Public | Will Gaybrick, President of Technology and Business at Stripe

23:03Turner Novak:Yeah, I was going to say. Because you obviously want to enable your customers to go live quickly, but there is a cost. Unlike SaaS, there's a cost to people using your product and then disappearing. We have Stripe Radar, which has always been focused on mitigating fraud at the time of transaction. Now we're looking up funnel with users and saying, hey, is this customer coming to you? before they even process a payment? Are they fraudulent? Are they likely to convert to a paying customer? Things like that. Are there any common, you know, things that that is currently capturing now? Like common AI scams, I guess we could say, or like most common that you've seen of like ways people are, you know, making a quick buck?

23:51We see sort of fraud rings where fraudsters are creating a ton of free trial accounts and then selling them. So it's sort of, you know, here's an account with this service. It gives you this much usage and we're packaging these all up. And here now you can test a bunch of your AI workloads on Shadeform or Cerebris or any of these types of companies. He's not speaking about any of them in particular, but that type of business model where you're hosting models. I think we're seeing a lot of fraudsters sort of basically aggregating usage models and then selling it.

24:35Turner Novak:Interesting. So it would basically be, if you were to go and sign up, you hit the limit and you have to start paying, but we could go and say, oh, wait a second, this person has a hundred or a thousand extra additional free trials that we can just tap into. Exactly. Interesting. Yeah. And you can see how they would lose a lot of money on that. Exactly. Yeah. Yeah. Yeah, the four major areas we're focused on in AI at Stripe are one, building economic infrastructure for AI. So this is everything we're just talking about, you know, the economic, the commercial infrastructure to implement AI business models, these hybrid models of subscriptions and usage.

25:11Two is the infrastructure to enable agentic commerce. I think everyone is really excited about this.

25:16Turner Novak:Yeah, you guys just did something. What's the, what's the thing that you just kind of announced? So a couple weeks back, we announced that we were partnering with OpenAI on ChatGPT Instant Checkout, which for anyone who hasn't used it, it is a great experience. I should have actually tried to use it. I have not used it yet. I should have before we did this. Yeah, yeah, yeah. No, it's fantastic. Incidentally, the day before we announced it, I was on Etsy buying a new dog collar for my dog. And the next day, the demo was shopping in Etsy in ChatGPT. Okay. And they're both great experiences, but I was just struck by how I really do think this modality of the iterative shopping within a model is going to work.

26:01You know, there's a lot of hubbub and promise to social commerce. And, you know, it's had some mixed success. I think TikTok is having some good success there. But I really do think chat-based commerce and mediated by LLMs is going to be powerful. So we announced instant checkout chat GPT. And the other thing we announced is what we call the agentic commerce protocol, which is a relatively thin protocol, but just a way of standardizing how agents should interact with checkouts. So checkouts have a lot of logic built into them. Which payment methods can you use? What discounts are there? How are shipping rates calculated based on basket size?

26:50You know, is this fraudulent or not? And so we had done a lot of experimentation with pure browser-based automation. And we found that the technology just sort of isn't there yet. And we thought the world would really benefit from an open protocol. This is not just a Stripe thing. but an open protocol to just enable the ecosystem to grow a whole lot faster. Is this the shared payment token? Is that another word for it? Yeah, that's how it's implemented on Stripe. Okay. And yeah, basically a shared payment token is a way of securely passing credentials between the point of purchase. So this would be Etsy or?

27:31Exactly. It's passing it from the point of purchase, which is a chat GPT to Etsy. and you know the point is that you don't actually have to expose the underlying credentials

27:41Turner Novak:to the merchant okay and this is and i know there was a specific reason that you did that which i feel like i should know i think in a lot of cases when we're designing these things we're thinking not only just how do we very proximally solve a problem for just this use case, but also over time, what's good for the world. We felt like the idea of agents just slinging underlying payment credentials to every merchant on the Internet. Didn't be dangerous. Didn't really pass like security and privacy muster. And so that's why we designed it to allow for this secure processing where you can collect the credentials in the chat interface and then use them to process without having to vault them with all merchants.

28:30Turner Novak:So like, Stripe doesn't actually like own the payment then with the underlying merchant, right? Is that fair? Yeah, we don't, you know, against open protocol, you don't have to build a Gentic Commons protocol on top of Stripe. We don't have to process the payment. You can use Stripe for it and we make it very turnkey and seamless. But we were pretty inspired by MCP, Model Context Protocol, that Anthropic released, I guess it was last year, from the standpoint of it being a very simple protocol, something that everyone could get behind, and again, create sort of this shelling point for how we're all going to work together on what we think is a very big opportunity across the industry.

29:15Turner Novak:And that's sort of how you think about product that Stripe 2 is like very modular. Like you don't, to your point, you don't have to use billing. You probably don't have to use Stripe issuing. You could use something else if you want. Why do you do that? Like don't, why doesn't, if I'm company and come to Stripe, I'm a startup, like give me everything Stripe. Like why is it so important to be modular? So I'd say this is a big inflection point in our thinking about how we develop products at Stripe. There was a time at which we sort of thought, hey, it's going to be the best experience if we are relatively closed and Apple-like and just everything will be tightly stitched together.

29:49and then we just learned from our users so that's not what they wanted i remember a conversation i had with you know one of the largest retailers in europe when i was in paris and they were looking for help in decreasing the size of their payments team because they had a couple hundred people on it on a retailer in france yes and they were that's like a stripe at a series d stage right Like a couple hundred people. Yeah, and just on their payments.

30:19Turner Novak:Yeah, just on the payments to you. They have like a whole stripe internally. Exactly. And actually, we've seen this. I think this was what people would build. And one of the things we try to do is say, hey, listen, we can take a lot of that off your plate. Yeah. I remember them saying, we would love help decreasing the footprint, the number of payments processors we work with, and some help in sort of orchestrating across them. And so I asked them, well, how many processors do you work with? And I expected them to say something like six. They said 83. Okay. So who are 83 payment processors? So you have, you know, a bunch of big names.

30:58Listen, I didn't ask them for all of the names. We have a bunch of big names who are offering sort of card processing across the world. And then you have a bunch of local players because they're selling all over the world. And so they're integrating to sort of local processors in Indonesia or the Philippines or Malaysia. And so navigating this, the logic across all of these is just a huge workload for them.

31:22Turner Novak:Yeah. And so for us, we could either sort of ignore that and say, hey, what you really want is just to run everything on Stripe. I think they would just say no, or you'd say, hmm, interesting. We really think we can help with that. And so we've been leaning into how do we help you orchestrate your commerce infrastructure? Like you said, you don't have to use Stripe payments with billing. You can use billing to run subscriptions, send invoices, and then process them with a third party. And I think we've just learned, particularly as we go upmarket and work with more enterprises, you know, now more than half of the Fortune 100 uses Stripe, that users want to be met where their systems are today.

32:04Turner Novak:and that's what we're focused on. And they probably have different pace of adoption, no different things. Like there might be some companies that are like, for the first time, we are accepting payment online. Yes. And they are not ready for everything else that you can do. Yeah, you know, it's interesting because the S &P 500, like the average tenure is like 15, 20 years. And so you could say, well, 10 years hence is, you know, Are all these people just sort of processing only on Stripe or many of them processing only on Stripe? It's possible, but we also do see companies growing up on Stripe needing to add other payment processors because our coverage in a given geography isn't good enough yet, or they have a board mandate for redundancy.

32:52We see that that latter one has been sort of waning. You know, last year we had 99.9996 % of requests on our critical APIs succeeding. It's actually less than one minute of downtime for the entire year. I was going to ask you how much time that was. Yeah, this is pretty interesting because... Was it all at once or was it like seconds spread out? Yeah, it's actually not like hard down for the API overall. It's just looking at like individual fail requests and then sort of imputing a time from that. But the fascinating side on the other side is we're actually also deploying about 1400 times a day.

33:35So you're actually pushing to production like roughly every minute and you're down for less than a minute the whole year. This has been, you know, just a concerted investment in reliability over the years. What are you updating 1400 times a day? That's right. Like what's changing? Any number of services, you know, and a lot of them are internal services. a lot of them are bug fixes and then of course some of them are bigger bigger pushes

34:00Turner Novak:so this might be an interesting time when you're talking about like updating bugs, fixing things, pushing so many times are you guys using AI internally at Stripe? to what extent are you using it? yeah we're using it a lot and we're using it in targeted ways where we are really focused on getting real value out of it There's the Jim Collins good to great framework of, I think it's a crawl, walk, run in terms of adopting new technologies. I guess his framework is the best companies are first discovering how this can really advance how they operate and create value for the customers. Then they start to scale that and they go all in.

34:46There was the HBR paper recently around WorkSlop. I don't know if you saw that in September. I don't think I did. What was it? Yeah, it's a study that asserted that 95 % of companies are actually getting negative ROI on using AI internally.

35:02Turner Novak:I saw that headline. That headline, exactly. It's always funny, there's these ebbs and flows of like, you know, it's over, AI's done, it was all a scam. Yes, yes. That's certainly not what we believe. But we really don't want that to be the case. So we're not just sort of like, hey, everybody, you have to use an LLM now for everything. And so we have found some very powerful targeted use cases. So I mentioned minions before, but also just writing code in general, particularly for our most senior engineers, giving them leverage to go faster because they're often thinking a lot about architecture and keeping them from needing to write every line of code, instead putting them in a position where they're sort of, we think about new grads and one level up as doing a lot of the actual code writing at Stripe.

35:50empirically they do write the most lines of code at Stripe. And now senior engineers almost have a dedicated team of level ones and level twos at Stripe because of LLMs, which can assist them in actually code creation. And then they're almost in a position of code review of the code that they've created themselves via an LLM. So depending on how you measure it, you could say more than 50 % of code at Stripe is written by LLMs.

36:17Turner Novak:Or you could say it's less. What's the highest you've seen? Didn't Salesforce say like 75 or 90 %? What was his number? Yeah, I'm always, I think Google recently quoted, or maybe it was Amazon 70%. I'm always interested into how, as to how people count this. Because we do, again, a lot of bug fixes and easy deploys via tools like Minions internally. And then we do a lot of code writing as an edited by people internally and so did they write that code? It was more of a collaboration. Yeah. Because a lot of times you just think it's like AI agents are running wild, like adding a new field to Salesforce or like whatever.

36:58Turner Novak:And that's the kind of, I feel like when some of the CEOs go on, like they'll do a CNBC clip and like, that's kind of what they make it think. They're what they make the audience think is happening, but it's still, there's very much humans that are involved in this. Like, yes, very much humans involved. You know, there's sort of a dynamic where LMs are doing a ton of work supervised by humans. So a good example would be actually risk mitigation. So not just anyone can process payments on Stripe. You need to be a bona fide business. There's certain categories of business that are prohibited or deemed highly risky.

37:33Those need some stepped up review with partners, financial institutions, banks. And so there's a very long document that if you are a human risk reviewer at Stripe, you need to deeply understand around whether or not a business is supportable for given use cases. LLMs are incredibly good at ingesting rules and then applying them. So we have seen incredible returns on assessing supportability on Stripe, both in accuracy and in efficiency by saying, hey, model, take a look at this website, take a look at all their product pages, take a look at everything that's said about them on the internet and let us know how confident you are that this business is supportable.

38:25And if things are flagged, then humans get involved and can provide that last 10 % oversight that can be dispositive. So that's been incredibly powerful. The other application that we're really excited about is augmenting our sales development team, our SDR team. Just the early signs are that outbounding, which is a new motion for Stripe, so much of our go-to-market motion has been driven by inbound. but outbounding is going to become not just more efficient, but also more effective when we let LLMs go deeply understand a business on the internet and then craft a message about how Stripe might be useful to that business.

39:07And then, you know, SDRs get involved to edit that, send it, and then sort of track the lead from there.

39:14Turner Novak:So when you say that that might be interesting, are you indicating that like, it's not quite there yet? Because I mean, I think everyone listening to this gets those like really bad AI generated sales emails. Yeah, we're actually seeing so far that they are getting higher response rates. Really? Okay. Is there anything specific that the higher response rates get? Like are they shorter emails? Do they like use numbers? Do they have misspellings? Like do you know? You know, I don't know offhand. I was actually reading some of these last week. Oh, really? Okay. What seems to be like the general vibe of like these good AI emails?

39:50And they seem very personalized. So they seem like, I really deeply understand what you're doing. And again, I think this is because they've been able to go leverage the base model that OpenAI or Anthropic or other has created that has sort of compressed the internet. And so they can take that compression, go look at a website and come back with a lot of really interesting facts about that company that would take a long time for just a human to aggregate. Yeah.

40:21Turner Novak:It might be interesting in non-tech related or even like non-email denominated jobs. Yeah. So like if you run a manufacturing firm or something and you get AI generated really good email about some like manufacturing related software or something, I'm actually, maybe this is a terrible example because maybe they get a ton of emails. But when I think of like mine is like a VC, I'm constantly getting emails and like a lot of them are AI generated. So I wonder if there's like in those like less email denominated industries or something where there's like or even like actually this might be illegal but like texting.

40:55Turner Novak:I actually don't think you can text people. Like there's a lot of rules on that. Yeah. But even, yeah, I don't know. LinkedIn, I think there's a lot of like LinkedIn automation that people do. Yeah, I've anecdotally seen a lot more inbound texts. So illegal or not seems to be happening. I get a lot from like loan companies. I think it's because like if you have a credit card balance, you like show up on a list and they're like, you know, you qualify for a personal loan, like$63 ,000, like consolidate your debt. Like, I'm not interested. Stop calling me eight times a day. Yeah. I get a lot of the fixed term employment offers.

41:28Oh, that'd be nice. Yeah. Like, Hey,

41:30Turner Novak:we heard you're looking for a job. Exactly. Do you ever get those? Like, they're like, I get a lot from like Indeed recruiters. Like we found your resume on, on indie or LinkedIn and like, I'm, you know, Patricia from, you know, Geico or something. And like, we're hiring remote workers. I've actually heard that there's some shady stuff that goes on with that. Like you're, they pitch you as like, you're running payroll for a company, but you're actually like a, almost like a drug money mule in a way, or like you're facilitating those funds. It's actually like a pretty common, um, tactic that a lot of people use for that, which is, does that show up on Stripe at all?

42:08Not that I know of offhand, but broadly, some of the best advice that I ever received, and I think should be as a company I've ever received, came from Robin Vince, who is the CEO of BNY Mellon. At the time, he was the CRO, maybe this actually was back when he was the treasurer at Goldman Sachs. And I had recently joined Stripe, I joined as a CFO, and I asked him, among other things, about being a CFO. Like, what is the single most important thing that you think Stripe needs to get right? And this is way back in 2016. And he said, you all will need to become conspicuously good at risk management.

42:49And it always stuck out to me as plausibly the case, but I wasn't so sure why. Yeah, because you probably think we need to build a beautiful product. Exactly. That's the most important thing. Exactly. And I think now Stripe is processing, you know, a lot more than Yeah, what's the last public number? Actually, I guess the last public number is 1.3 trillion and 1.4 trillion of payment volume per year. So, you know, you're between one and 2 % of global GDP. And so at this scale, you're becoming an actor that is sort of systemically large. Yeah.

43:27Turner Novak:Someone takes you down, 2 % of the economy doesn't run. Exactly. Yeah. And so that, you know, the investment in reliability is so critical. Investment security is so critical. And also you become, you know, a huge target for not just fraud risk, but you mentioned a second ago, you know, sort of scams or transaction laundering. You'll see a lot of times on Stripe what looks like a very bona fide merchant. You know, here's the domain. And, you know, you can actually place purchases, real looking products. And it is, in fact, sort of a mule for you to buy guns on a different website. Oh, interesting.

44:04You go to the other website, you see what the gun costs. You buy a product that costs the same amount on here.

44:09Turner Novak:Like you're buying a makeup kit or something like completely unrelated. Exactly. But this is actually where AI is, again, extremely powerful. We've always had a bunch of ML models in production at Stripe, about 150 models in production at Stripe. And some of these are DNNs, like deep neural mats. Some of the more sophisticated ones are. But we launched mid-year this year, the first ever payments foundation model. And basically what the payments foundation model is, is these giant vectorized embeddings where you take just a ton of Stripe data, you tokenize it, you throw it against the transformers, and you then end up with this clustering.

45:00It's an encoder only model. So you're not actually saying that we're then going to sort of decode it and sort of, you know, make a lot of extrapolations about exactly what the data means. But we're able to see the clustering of different merchants and these transaction laundering merchants just show up together in the sort of giant embedding space. And so it's been fascinating to see. I think one of the great discoveries or revelations the past few years in AI has been that you take less opinion and model, less opinion model architecture, a ton of compute, a ton of data, and that tends to work better than sort of the really minute architectural thinking around models.

45:48Now, that's only partially true because there's still a lot around architecture that has been the unlocks, things like inference time, inference time compute. But what we've seen is that we had a lot of hand curated features in our models in the past. And by just creating a really big model with all of our data, we're able to mitigate risk a whole lot better than we were able to, you know, by sort of using our intuition around how you would discover these companies.

46:14Turner Novak:And it's just because you keep getting a bigger data set or more tests and then that it solves itself. Like, is that how it works? Yeah, it's sort of the magic of DNNs. They discover their own features. And so the features that you may intuitively think will lead you to whether or not a customer is laundering firearms transactions through what looks like a kids toys website may not be the most telling features. And a giant foundation model can discover those. Interesting. So do you use, you said you don't really use it necessarily, but you like made it to like see things. Is that a fair way to describe it?

46:51Turner Novak:We do use it. We do use it. Okay. Yeah. And primarily for risk mitigation. Yeah. Okay. So card testing, again, the card testers show up, you know, as a cluster or transaction lotterers show up as a cluster. What's a card tester? Is that like you're testing to see if the card will work if you want to like just run a bunch of money through it? You've stolen a ton of cards or other payment credentials. You want to resell them. You need to know which ones like you can actually are actually usable. Maybe you want to use them yourself. Yeah. Yeah. I think the surprising thing, I had a guest probably about a year or two ago.

47:23Turner Novak:her name is Natasha. The company is called Cable. They do like, they help just financial institutions fight crime, basically financial crime. And it's, it's like a couple percentage points of GDP. It's just like people doing crime, which is like fraud, drugs, other, even more horrible things. So it's pretty interesting just like how big that world is. It's kind of scary. Yeah. Yeah. One of the pillars of our company strategy for the past three years running running is to become guardians of the global financial ecosystem. And that has meant, you know, by turns, getting even better at mitigating risk on Stripe while creating, you know, a surprisingly great user experience.

48:08And the back end, how do we create tools and platforms that we can actually sell to other financial institutions or to our users to mitigate risk on their side?

48:16Turner Novak:I think you were pretty involved in this product. It's kind of, it's connected to ChatGPT right now and how you do payments is called Link. What's the story with Link? What is it? And what's the scale of it now at this point? It's our only consumer product and it's effectively a very thin layer that we created to increase conversion and broadly improve online payments. It now has over 200 million consumers in the network. It's growing very, very quickly. And it was predicated upon the belief, and now I think sort of confirmed belief, that we could create better payments experiences by having the ability to set this little cookie with consumers and have a thin relationship with them than we could otherwise.

49:04So, for example, our customers have, for Stripe's entire existence, wanted bank account-driven payments. So ACH, you mean? ACH, CEPA in Europe, you know, BACs, BACs in other parts of the world in Australia, New Zealand, or BACs, I guess, in the UK and BACs in Australia, New Zealand. And the problem is bank account payments are, they don't have a lot of the sort of magic of credit card payments. You know, I think the schemes Visa, MasterCard, Amex have built some really powerful infrastructure. You know, They have kind of root access to program the money in your bank account. They can say, hey, you just bought this coffee.

49:49I'm going to hold$5 or New York,$8, whatever, in your bank account. And I'm going to then settle it to the merchant at the right time. You don't have that with ACH. So you actually see that something like 4 % of transactions fail five days after the transaction happened. And so we built Link for many reasons, but one of them was, hey, how can we actually make a bank account payment method that works the way you want it to? So one of the things that customers want is instant confirmation that they'll get the cash. So they don't want to wait five days to know whether or not it went through. There's a merchant that is using Stripe.

50:30Exactly. So, you know, if you actually go into Uber and you can see that it's supported right in the Uber app, you know, Uber, you know, wants to know at the time of booking the ride, is this payment going to go through or not? So if you use instant bank payments on Link, you get instant confirmation that's going to go through. And so there's a whole lot of things we have to do to enable that. But one of the biggest ones is just the underlying ML model to say, well, we know all of this about you and your transaction history, and you've linked your bank account to Stripe. And so we can automatically confirm that payment.

51:02There's also just the pure convenience of Link, where you're showing up at a new merchant and you can pack in your 16 digits and your zip code and everything else. Or you can just get a quick OTP on your phone to say, I'm at a new AI service. I say that because Link is overwhelmingly popular with AI services. And I would rather not have to go through the whole checkout flow again. I just want to get started quickly. Yeah.

51:32Turner Novak:And you started pretty quickly, right? It was just kind of this like, initially, I think it was like the remember me feature, like you click a button or something like that? Yes, that's right. Did you not expect it to just keep growing? Like, what's the story there? So we technically launched Link, wasn't called Link, back in, I think, 2014. And it was a ability to remember your payment credentials on what was then called Stripe Checkout. And then when we launched the new version of Stripe Checkout, which was in 2018, it didn't have Remember Me built into it. Oh, she removed it. Yeah, we removed it.

52:08And there were millions of consumers that were using Remember Me, but it didn't have a name. There was no sort of identified consumer thing. It was just a feature on Stripe. And then we woke up one day, we're like, why did we get rid of that? Like, that was really useful to merchants. And so Link was the sort of reincarnation of Remember Me. It started only a few years ago. And as I mentioned, now over 200 million consumers and becoming a big deal. And we actually see that for a lot of merchants, particularly the new cohort of merchants joining Stripe, it's 50, 60 % of their transactions are link transactions.

52:45Turner Novak:Oh, interesting. Is there a benefit to them? Where it's like speed, cost, anything like that? Or is it just like higher conversion because people are saved? That's the principle one, higher conversion. Customer experience, just consumers love link. It's a very subtle experience today. So actual brand awareness is relatively low. We're going to be changing that in the near future. But, you know, you'll see just go through Twitter. You see people say, I love it when I see a link. Yeah, it's really like my favorite link story personally is I when I first signed up, I put the wrong phone number in.

53:17Turner Novak:Like, I think I put like a six instead of a nine at the end of my phone number. And so it like didn't work for me for a while. And every anytime a checkout had link, I like I couldn't use it because I couldn't change my phone number in the thing, which I think you guys have since updated. and I can like use it again. But I just remember thinking like, ah, it's like the only time I ever put my phone number in wrong. I couldn't use the product. Yeah, it definitely was a launch and iterate quickly experience on the consumer side. So thank you for bearing with us. But, you know, it goes beyond cards and bank account payments.

53:49You know, we're always thinking at Stripe about, you know, obviously our users and they are the primary focus for Stripe, but also just other constituents in the payments ecosystem. And so we've partnered with Klarna recently to create what I believe is the best BNPL purchasing experience on the internet, which is sort of link x Klarna. They serve a bunch of custom APIs for us. And if you use buy now, pay later services, you'll find that they're incredibly powerful for increasing conversion in some ways, but they're also very frictionless. You actually have to get bounced out to Klarna or firm or otherwise, put in a bunch of information, wait for a spinner for a while to say whether or not you're eligible to make the purchase.

54:28we do all of that underwriting in the background in link so by the time you actually get to link checkout if clarinet appears it's just one click to check out oh interesting i didn't realize

54:39Turner Novak:that because you always see those like you've probably seen the memes you remember back probably like it's probably 2021 there would be like literally 10 options of like there would be there'd be like a stripe type checkout button there'll be like amazon pay there'd be like shop shop i pay fast there's a couple of these startups that we're doing one click checkout and then Klarna, all the, there's like four BNPL options. Is that, I don't think I have to, like, it's just a funny observation of like, but I feel like we're, we've moved past that, right? Like, is there like consolidation in sort of that like checkout button space?

55:14I don't know that we're in a sort of, I mean, there's been some consolidation, you know, Cash App bought after pay, but there hasn't been a whole lot of consolidation. And this is actually one of the areas that we really focus on for consumers. is when one of your shoppers hits the checkout page. For that particular shopper, which payment methods should you show?

55:36Turner Novak:Oh, yes. You source the certain one higher. Yeah. Yeah. And we see this drives conversion a lot. So one question, there's probably people who've been listening to this, I don't know, we're like an hour in. There's probably people that are kicking me like, dude, you got to ask them this question. Why haven't you asked this yet? Stripe going public. I know people always comment on it. Anything to say? Not a ton to say. I think maybe the, I think the sort of incumbent perspective is why aren't you going public? Yeah. Or why are you staying private? Yeah. And I think the way that John Patrick and Stephan, our CFO, and I think about this is why are you going public?

56:19You know, it's a bunch of work. It's the whole different way of operating. You know, we already operate with the controls, the rigor, the time to close of a public company. And so it's like, what's the incremental benefit of going public? And, you know, when I joined as CFO a long time ago, we had this principle of we always wanted to operate cash flow positive. And to this day, we've actually never burned a dollar of investor money. there were a couple of years in the early 2020s where we burned cash, but we didn't burn sort of below the amount that we had accrued on our balance sheet. So just, you know, Stripe has always been sort of financially independent in that sense.

57:07Stripe is now extremely profitable. And so there's a question of like, what is the reason to go public? Yeah.

57:14Turner Novak:It seems like a lot of people like you need to give retail investors the ability to participate. Like that's a common reason that people give. Yeah. And I guess that's sort of a belief in like creating like equity between institutional investors and retail investors. Maybe that's, yeah, I'm not sure that that is the thing that should guide our decision making here so much as - There's billions of people that need Stripe equity in their retirement portfolios. Yeah, I would say, you know, being a mission driven company, it is how do we grow the GDP of the internet as quickly as possible? How do we stay just resolutely focused on our users?

57:53We're already a highly regulated global financial institution. And so, you know, the day comes where we say, hey, you know, there really is a good reason to do this. And I suspect we will.

58:03Turner Novak:So yeah, I feel like some of the benefits of being public is like you have a, your stock is more liquid. So in theory, there's like a, you have like a lower cost of capital, but then you can argue it like on a, on a company per company basis, like how much of a benefit does a specific company get from sliding into that? Like you may not get much of a benefit. Yeah. I think another interesting thing when I think about this is just like the incentives of your investors. So if you're managing like a public market assets or funds, and you think about how do you make money? You charge management fees and you get carry.

58:37Turner Novak:And you get paid carry quarterly if it's public. You get paid on the exit if it's private. But typically, I mean, there's been a lot of fee compression in public markets. So if you're managing public market money, you might be getting like 1.5 % management fee, maybe less. You may be charging on average like 15 % carry versus in the private markets, 2 % management fee. Some people do like two and a half or three percent. And then also you get the carry, the percentage is also higher. So there's like, there's a certain element of like certain investors are like, I think it's perpetually continue to shift from public to private because why wouldn't you?

59:13Turner Novak:Yeah. Yeah. And there's clearly a blurring between public and private investors at this stage. Yeah. I think in the, in John's podcast, Cheeky Pint with Dan and D1. Yeah. He's like a public market investor, but I think he said like 70 % of their AUM is private. I may be getting this number wrong, but I think I remember him saying that more was actually on the private side, more AUM, which you wouldn't have thought about that. Yeah. Yeah. Yeah. I think the principal reasons why companies go public besides just inertia and the idea that you're supposed to do it are one, access to capital, Stripe has issued bonds, investment a great company, highly, highly cash flowing.

59:54That's not an acute need today. Creating employee liquidity. We've been able to run tender offers. We can't promise to always run those, but we've returned many billions of dollars to investors, to employees, and so on. And then the third is maybe something around marketing and branding, where by being public, you're more trusted or seen as more enterprise grade. That may linger around in certain corners, but I think we've mostly crossed that transom. Half of the Fortune 100 using Stripe, Stripe being one of the major processors for companies like Amazon, Stripe moving$1.3 trillion in money per year.

1:00:38So just none of those three really seem to be pushing us down the IPO river. I think there's another element too of early people with illiquid stock want liquidity.

1:00:49Turner Novak:And so if you just kind of go public, it's like just get your liquidity and just kind of deal with it. But you definitely see this with some larger private companies where they just do like I think SpaceX does like quarterly liquidity or every six months is just like a planned like, you know, you can sell whatever you need to sell. We do this event. So I think that's something that's kind of evolved to. And then some of the business models, some of the private market funds also is like we are on the cap table. We will give you some of our access to our shares that we have. Like that's another model that's emerged.

1:01:20Totally. Yeah. Listen, the the the market, I don't mean the stock market, I mean, just like the market changes quickly. You know, every year we write a consolidated company strategy and you just can't over invest in strategic clarity for for yourself and for your team. You said you cannot over invest. You can't over invest in it. You know, it's one of my biggest learnings as a leader is that what may seem obvious to you just is not obvious into all the minds of the company. And so you just, you really want to emphasize strategic clarity. Actually, it's fascinating. In 2021, it was, you know, we do an internal Stripe sat and we ask about a bunch of different things.

1:02:01One of them was like, Stripe has a clear strategy. I think something like 50 % of respondents agreed with that. We're now above 90%. And it's just a concerted investment in sort of, you know, incanting the most important things, what you're focused on and why. This year with these sort of twin revolutions in stable coins and AI, it's not that we've thrown the strategy out the window, but we have had to be very, very nimble in thinking about deploying internal resources and some of our best people against new opportunities. And so being private, But having the flexibility to think about doing that without like wondering about any major like knee jerk reactions that might happen from investors and activists and so on, I think it's a luxury.

1:02:49And again, it may be that at some point there is a good reason to go public. But today we ask ourselves, why do it versus why not?

1:03:00Turner Novak:there's also kind of to your point about like activist investors it's just like annoying component is like if you've got two billion dollars or like your company is worth x amount and you can get a percentage of it and like make demands and it's like i think i had aaron from box on the podcast and he was like they had to deal with some stuff where like people were trying to kick him out and force him to sell and they got through it but it was just like not what he wanted to do yeah and all these are tractable problems and aaron is amazing and he navigated that so well But man, it probably wasn't the way he wanted to spend his time and probably wasn't the highest and best for how he spent his time.

1:03:33Turner Novak:His hair's a little more grayer than it was if you age for sure. So I want to ask you, so back in college, you did this thing called Hack Yale. What was it? Actually, I was in law school. Or in law school, yeah. I was in law school. It was this very fun sort of incidental mission where I was at Yale Law School. I was actually also working in the city as an engineer at the time and you know I had been an undergrad at Harvard and had seen this incredible culture what year was this like 2010 ish for undergrad yeah I guess I graduated in 2007 so it was in the you know early to mid-2000s okay this is the you know the Facebook meta you know gestation era did you have like a like a hot or not account what was the original one called were you a real member I honestly can't remember I know there was Friendster, but that was separate.

1:04:27Turner Novak:Yeah. But you were a member of the Facebook. I was on the Facebook when it was Harvard only. And there was this incredible culture of like entrepreneurialism as an undergrad. And I was actually really struck when I got to law school that there just wasn't. And the curriculum for computer science was like sort of OpenGL and some like legacy technologies. and learning about how computers worked in a sort of backwards looking way versus just like, hey, how can you build things quickly? There wasn't really this builder mentality. And so Hack Yale was about how do we create this builder mentality on campus?

1:05:11And so I had all these undergrads coming to me, I guess through word of mouth saying, I have this idea, like, can you work with me on it? Can you build it with me?

1:05:22Turner Novak:Oh, because they knew you knew how to code. Exactly. You were an engineer. It's like that classic, I got an idea, I just need to build it. And the answer was, no, I can't. I have a lot to read for law school and I have a job. But maybe I can teach you. And so it started with just a handful of kids the first week. And I was just thinking, okay, I'm going to teach JavaScript end-to-end so that you can think of server-side and client-side in single language. This was early days of Node.js. And just get people from zero to one. They can just start building their own, at least demo apps. So it started with probably nine kids the first week or something like that.

1:06:02Second week, it was standing room only, but in a 30-person room. Third week, it was over 100. And there was no fourth week. I shut it down and said, okay, let's see what this could be. So we just posted around campus that we're doing this and allowed students to apply. And in a week, a third of the Yale undergrad student body applied for the class, which was pretty amazing. But this wasn't actually a class. Like, it wasn't an official class. No. In fact, the computer science department hated me for doing it. It was actually quite controversial. Really? Yeah. And so I ended up working with some amazing people on it.

1:06:43Miles Grimshaw, who's an incredible partner at Thrive, was one of my TAs. And Bay Gross, who runs a great startup and was at Google before, was sort of a co-teacher with me. And so we sort of turned it into a proper curriculum. I was all pro bono. And it lives on to today and actually sort of went to multiple campuses. But it was really, really rewarding and fun just trying to sort of change culture on campus. and actually finds a leader. Just culture is one of the hardest and most fun things to work on. I often find that companies have too many operating principles. And this was even true of us until recently where it's like, here's the 15 things that we sort of reward and think about prioritizing as a company.

1:07:43And we've really distilled ours to just a handful. And I think about the people who are the most successful at Stripe. They are the most user focused. They are the most impatient and fast. They are most demanding of quality in what they do. So we say like be meticulous about your craft, focus on craft and beauty. They're the most humble, the most collaborative. And it's really, you know, that handful of things that makes, you know, people successful at Stripe. And so, you know, just always thinking about culture, how are you modeling it? How are you messaging it? I think it's one of the most important things you can do as a leader.

1:08:21Turner Novak:And then around like this same time you, I can't remember if you joined Thrive when you were at school or if you had graduated, but how did that come about? Because that was a pretty big, pretty big move back in the time. Yeah, I was, I was still in school. Josh Kushner, he's Thrive's founder and runs Thrive, reached out to me cold. We didn't really They know each other. And I was working as an engineer at one of his portfolio companies. At this point, Thrive was a really, really small fund. Josh and Jared, a little bit of individual's money. I don't know, actually, I think it was some of the general catalyst partners were involved.

1:09:01And he reached out because he wanted a CTO for the fund. And so the idea is that I would join the fund as a CTO. and actually I remember, you know, hacking together like a CRM in the early days so we could track conversations and start thinking about tracking information about companies. And then it turned out what we really needed was just people to do deals. And so I started doing that and was fortunate and very excited to be on the journey from Thrive being about a$5 million fund to being a few billion by the time I left for Stripe about five years later.

1:09:37Turner Novak:and so i i think claire asked me to ask you this you wrote a memo to do the investment how is that memo played out like i don't know if there's like significance of what was in this thing but she wanted me to ask about it how does how does that all kind of happened between oh i see like the investment memo at drive to message was was there like a like a legendary memo that she's mentioning or maybe she's just wondering like what did you think about stripe at the time what it could be and like what how it's evolved. I always think that in B2B, you really want to focus on problem areas that have an enormous market size, like some degree of universality, like everybody needs the mousetrap you're building.

1:10:20Then a notion that people really care about the quality of the mousetrap. They want the best one. I think of this as it's being core to the purchaser. They really will care about their choice. So an example of a company I invested in that is universal, but maybe not core, was a great company, a company that Stripe uses called Greenhouse for applicant tracking. Everyone needs an applicant tracking system, but it's a few on the market and people don't necessarily agonize over which one. Part of the reason I was so excited about Stripe was it's such a macro opportunity. You could just see the focus of the company, mission of the company being to grow GDP.

1:11:06That was the mission back at... That was the mission back then, yes. To accelerate the pace of globalization. So quite inspiring. John and Patrick are very inspiring people.

1:11:13Turner Novak:Yeah, that's great marketing at the time. Yes. From like getting people excited to join, invest, et cetera. Yes. And had the right customer base, right? You know, you have, you know, back in the day, and I'm not actually sure that people thought of the merchant acquirer they were choosing as being super core so much as just which one's the cheapest. And developers as customers really wanted the thing that could help them move the fastest. Growth was extraordinary. I felt a lot of, I had a ton of respect for John and Patrick and really liked working with them as an investor. And yeah, I think in terms of the question of how it's played out.

1:11:53You know, I don't think I projected Stripe out 10 years. It's been almost 10 years. I could go back and look. But last I checked, Stripe was ahead of my projections on volume and slightly below my projections on margin. And I don't mean OPEX margin, but just margin in terms of like gross margin. Like the take rate essentially? Exactly.

1:12:15Turner Novak:Yeah, the take rate net of network fees. So Stripe did not turn in like a big corporate behemoth, like extracting value as fast as you thought they would. Like you're still like very much, you're just, you're giving a lot to the ecosystem. One belief I have that maybe is a bit contrarian is that it is great to be a low margin business. And the people over index on margins, you know, for example, public market investors will really care what your gross margin is. To a large extent, that depends on how you report your revenue. So a lot of payments companies report net revenue. And then off of that, their gross margin will look really high.

1:12:55They're pulling out all the payment systems costs. If you look at gross revenue, then they're a lot lower margin. The reason why I think being a low margin business is great is it just keeps you obsessively focused on customer needs. There's so much leverage in the next thing you can build for customers that they will fervently, enthusiastically adopt because the core of what you're selling them is a low margin business. You build that additional service, you might be able to augment your margin by 20%, by 10%. But if you're already super profitable,

1:13:31Turner Novak:the new thing might just not even move the needle, you're saying? Or it might actually decrease your margins or something like that. And so I think if you did some sort of regression or PCA or something like that, you'd probably find that for the most part, companies that have lower margins, at least to begin, are the most customer obsessed. Amazon obviously being a great example. Yeah, I think Amazon's an interesting example too because there's such a long period of time where just the general consensus was Amazon is not profitable. So just like internet commerce isn't profitable. Isn't going to work.

1:14:05Turner Novak:Yeah, exactly. And I think there's like a crazy story with the way Walmart ran the business and like compensated people. Like as a store GM, you are compensated based on how your store performed. And so like if somebody in a customer of your store where it's like order something online, it would, you were incentivized for that to not happen because you get paid less. So like Walmart itself, because of this like almost like meme of like, oh, Amazon's not profitable. We don't need to worry about e-commerce. It's got to the point where it's like 2014. You're like, oh, wow, we have never focused on this.

1:14:38Turner Novak:and Amazon kind of beat us. And we'll never fully recover. We kind of lost our footing that we have. So I think it's an interesting way to continue to operate with, under the surface maybe in a way too. People don't fully pay attention. Because another example is you just look at, you ask someone, what's the most interesting thing right now? And it's like AI. What's the fastest growing, most profitable thing? And it's like chat GPT. all right, we need an AI strategy. So everyone is like attracted to this light. And they like, forget about, oh, there's like a low margin, also really good business that just that no one cares about because AI is the thing.

1:15:18Yes. Yeah. There was definitely a consensus in the early days that Stripe wasn't a good business because margins were low. Actually, it wasn't a consensus, But there was a cohort of people who felt that strongly. And I think others who saw more potential. On the note of just how it keeps you focused on users, stablecoins are, I think, an incredible opportunity for our customers who have low margins. because if you think about marketplaces, maybe they take 3%, 5%, 10 % off of the GMV that they're creating. If you're looking at the payment method costs, be that cards or BNPLs or otherwise, or wallets, that can chew up two-thirds of the take on those payment methods.

1:16:17Actually instantly boost your profits, 30%, 50%. Exactly, yeah. If you can create a high-converting global payment method using stable coins that is, you know, really going to boost the margins of these companies.

1:16:30Turner Novak:So then how did you decide to join? Like, you had been at Stripe, or sorry, you were at Thrive, and you probably were pretty happy as an investor, I'm assuming. How did it kind of come about that you joined, also you joined, you joined this one as CFO? Yes. It's probably, I would probably not have you pegged as like the top on paper choice of like a CFO of a company at the time. Yeah. So I think, I think I was an accidental VC and then sort of an accidental CFO. I loved working at Thrive Thrive. It was an amazing place. So I love the team. I don't think that being a venture capitalist was the thing I wanted to do when I grew up.

1:17:08Just I'm a technologist. I want to have my hands in what we're building. Be very close to it. One night, I got a text from Patrick saying, hey, do you want to come be CFO? That was it. Yeah, that was it. And I think I replied, I probably have the text way back somewhere. That seems like a really bad idea. And Patrick being very convincing, said something along the lines of, well, John and I think we could do it. And I was sort of like, all right, challenge accepted. And I wasn't planning at the time to leave Thrive by any means. I think my sort of incumbent plan was, you know, this is great. I'm going to do this for a while longer.

1:17:52I'm going to go start a company. I think that's always a journey that I had expected to be on. But it was Stripe. And John and Patrick are just incredible people. I was really motivated by admission. I thought the product was excellent. And then in terms of CFO, we talked earlier about going public. At the time, we were certainly nowhere near that. And so there was, I think, the ability to bring in a CFO without public market experience. and I think there were a lot of ways I could contribute as CFO. I'm not sure that I would have been the sort of best CFO to take the company public. And a few years in, I talked to Patrick and just CFO wasn't really the journey that I wanted to be on.

1:18:34So today we have an incredible CFO in Stefan Tomlinson who's worked at a lot of public companies. And I think he's a better profile for Stripe at CFO than I would have been.

1:18:44Turner Novak:Yeah, that's fair. And then how do you think you earned their trust, like as somebody sort of from the outside, like, because obviously there was like a reason that he texted you this. It probably wasn't like, hey, what do you think about this idea? It's like probably made up his mind and was like, come, come do this. Like, what do you think was the reason that they trusted you? That's a good question. We all believe strongly that just by far the most important input into hiring is back channels and references. I think people really over index on the several times that you spend 30 minutes with a highly consequential hire.

1:19:21Turner Novak:And just like how well can you read them and like you look in their eyes and like this guy's a killer or something like that. Yeah. Okay. Yeah. I tend to look at sustained performance at excellent companies as being a key indicator and then back channels and references. So Patrick and I knew each other pretty well at that point. We'd known each other for a couple of years. And I think he had talked to a lot of people and felt like it was a good bet to make. Interesting. Yeah, that's fair. And then Claire also mentioned you put a really high sort of priority on the strategic finance function. I guess, I think I sort of know what that is, but some people might not really know what that means.

1:19:57Turner Novak:So what is strategic finance and why was that such a big deal to do at the time? Yeah, I think maybe the industry term for it would be FP &A, but the part of FP &A that is closer to product development and go to market. Okay. There's sort of corporate, which is consolidation and closing the books and so on. And then there's the part of it sort of partnering deeply with the business and with product development teams. When I joined, I think we had five people on the finance team and most of those were So on the accounting side, we didn't even have a treasury team. We had a small tax team. And we really just didn't have a good understanding of the business.

1:20:40And so in the early days, just wanted to get to having a baseline model for Strape's trajectory and how we make money today and how we can expect to do so tomorrow. I remember like one of the early inflection points that doesn't sound like an inflection point, but it actually was in our thinking, was when we launched Radar. Radar is our fraud mitigation tool. It was the first time that we launched a product that was not payments. And again, this probably sounds incredibly obvious in retrospect, but the incumbent perspective to that point was Stripe would be the product and it would be you buy Stripe and Stripe processes your payments and does a bunch of other things for you and you're going to pay for Stripe.

1:21:19And this was the first unbundling of products. And I think that was guided significantly because of some of the early investigations we were doing and seeing that as our customers were getting larger, they wanted to see more unbundling of value and they wanted to see, well, I'm paying this amount for payments. I'm getting competitive bids from others saying, we'll give you lower payments rates. But we knew our fraud product was really, really good. And so it was, okay, well, let's give you a better rate on the core payments, but let's also sell you fraud mitigation and sort of demonstrate that value as being sort of two dimensions as opposed to one.

1:21:55So this is an interesting kind of like evolution then.

1:21:58Turner Novak:So then how do you think about the go-to-market of the Stripe enterprise of products today? Like when you said you're seeing results on SDR, AI, outbound or whatever, do you figure out a specific pain point you try to have as the entry point or is it always payments? So it's not always payments. And I would say just a big learning for me, and I think just something I would advocate to founders, CEOs, product leaders, is just get incredibly close to go to market and to sales. Because when you step back, sales is reality. It is that moment in front of the customer. Are they interested or not? Why are they interested?

1:22:40What can you learn from that? that is just so viscerally educating as to where you should be going as a company. And so today, I think we see a bunch of different entry points into companies. One is around core payments. You know, you have for enterprise customers, in most cases, like a pretty significant enterprise, sorry, payments infrastructure they've built. And you might have more of a land and expand motion there where it's like, okay, adopt Stripe for part of your payment stack, see how we perform. Auth rates tend to be a very key part of the calculus. Or, you know, you want to add a payment method that you don't have today, you can use Stripe for that.

1:23:22The really interesting thing that we've been seeing on the core payment side is customers using what we call our optimized checkout suite, which is the hosted interfaces I referenced earlier. And there was this incumbent perspective that people would never outsource their checkout to Stripe or to any third party. And now we see that selling in the optimized checkout suite and saying, you can use any payments processor you want behind it, but it'll convert better and you'll have a better customer experience has worked very well. But we see billing as being a huge sort of independent sale at Stripe.

1:24:01Connect, which is our infrastructure for marketplaces and platforms. Stablecoin's a really, really big one at this point. particularly for companies that have a very global footprint. Increasingly, radar and fraud tooling is an independent sale. So we have our go-to-market machines are structured as a frontline of a few hundred account executives, which is still very, very small. And then an overlay of specialized sellers, technical sellers for these individual product areas. And one of the really valuable learnings for me over the past couple of years is just how impactful it is to think about how you organize your sales team as almost a chipset.

1:24:52You have to design it really, really carefully. You ship it. You can't really change it that much for a year. And so being so intentional about how sellers are compensated, what you're pushing, what your sales plays are. You know, do you have hunters and growers or is it all just one type of A has been?

1:25:11Turner Novak:So hunters like new customer grower is like, hey, here's some more stuff you should try that'll help you exactly help you grow. And just, you know, here's how we're just making you successful, even on your current product set. Did you mess that up at some point? It sounds like maybe there's like some scar tissue around like how you designed or I would say less scar tissue and more just didn't pay enough attention to it. So maybe you got lucky-ish that it kind of worked? Well, we've been really under-invested in sales and marketing. Even today, sales and marketing together are under 10 % of the company, which is well below.

1:25:46Turner Novak:110 % of headcount or revenue? Headcount. Headcount, okay. Interesting. And so the one thing you mentioned, maybe an interesting topic, just semi-related, you mentioned like Stripe, we like the lower margin is like, we're totally okay with it. Why are the margins low? Do you just have like a lower take rate than competitors or like what's because that's probably another question that people like, what are saying is like, come on, you got to ask this question. Yeah. Yeah, it's funny because you'll sometimes see in startup board decks, you know, the margin bridge where there's this big chunk that just has stripe, you know, and it's like, I promise you, we are not taking 3 % of your revenue.

1:26:24We would be a very differently shaped business if we were. You know, the vast majority of that is going out to payment systems and, you know, in particular to banks via interchange to Visa, MasterCard, Amex for scheme fees. And so particularly in the enterprise, you're pricing that is sort of the underlying payments costs plus, you know, a small number of BIPs, basis points on top of it. That's what Stripe takes. But then in that small number of basis points, you're paying your infrastructure costs, you're paying a bunch of variable costs related to serving customers and so on. So core enterprise payments is not a very high margin business.

1:27:01Turner Novak:Do you do anything differently than other people that like adds more value to customers that like ends up having lower margins? Like, is that a fair thing to say? I think we do a lot of things differently that adds value. I mean, I mentioned earlier reliability just being a critical one. And I do think that some of our infrastructural workloads are pretty fat in order to enable that. So you spend more on your own infrastructure to have a higher uptime. Yeah. And I'd say both in terms of operating expenditures and in terms of just like core compute. Consistency promises in our API are pretty expensive, meaning that, you know, the data is updated atomically in the API across a bunch of different services.

1:27:47we for for startups, we give away fraud protection for free. We think about this as being a core part of our value proposition, but also critical just to the overall ecosystem. Like you sort of have to buy fraud from Stripe and at some level because otherwise, you know, just fraud rates in payments are going to be too high.

1:28:06Turner Novak:Yeah. And plus, if I'm like a fraudster and I'm thinking about who's the best company to go after, is it a big corporation or is it like a small startup that doesn't have capabilities. Like they're probably my first target if I'm thinking through that. Totally. Yeah. You see, fraudsters are infinitely creative. Card testing used to be a matter of taking a bunch of cards, choosing one merchant and attacking them, just running a ton of transactions through them via scripts. A couple years ago, we saw this new type of attack where card testers were using Stripe checkout, which is the fully hosted payments page we offer.

1:28:44So it's actually hosted on Stripe.com. So they would make their own checkout page? Actually, they wouldn't make their own checkout page, but they found a way to identify thousands and thousands and thousands of checkout pages. And then they would dribble their tests across all of these. So you'd see a few transactions. They were using very generic names. I can't remember what they were, but it was like Jack Smith or something like that. And you would then see on Twitter, these startups saying, I have this Jack Smith customer who's clearly fraudulent like Stripe, what are you doing? And it was just very hard to detect these because only a few transactions on each.

1:29:22It's actually pointing back to the foundation model by sort of aggregating so much data into one big model and then sort of clustering in this like very high dimensional space. It's super easy to solve that today. But yeah, fraudsters are very entrepreneurial and clever.

1:29:42Turner Novak:Yeah. I mean, you have to. You got to evade. You got to not only evade the customers and the merchants, but like law enforcement. You got to stay on top of a lot of stuff. One actual part, one of the last questions. I feel like Stripe is pretty easy to use. Just like generally speaking, it's probably one of few financial services products where you can, maybe this has changed a little bit over time, but go to the website, sign up. I think you can just start using it right away if I'm remembering right. Why do you think so many financial services products are just hard to use? Like you got to talk to a salesperson.

1:30:10Turner Novak:You got to wait so long. It's hard. You know, one of our core strategic principles is to make our products and just Stripe generally instantly self-servable. It's, you know, what customers want. They don't want to wait. Some of them do. Some of them want to do a deep assessment. But startups in particular don't. They just want to get going as quickly as possible. And to the point of becoming conspicuously good at risk management, there's a whole lot you have to do to enable that. And so we are, as you're going through onboarding this, we are underwriting you in the background. We're running a bunch of different models.

1:30:50We're deeply understanding your site. We're looking at our foundation model to see, is there anything that's popping up there? And a lot of customers, not the majority, actually don't know what percentage offhand, but probably 20 % or so are stepped up for review, meaning we'll do human review before you can move your first dollar. But even then, we can get you live within a day.

1:31:13Turner Novak:But you can still probably get the API half stripe in the product, but you can't use it yet. But you can get it. You can start using it, but you can't transact yet. The majority of users can start moving money within minutes. Some percentage of users, it maybe takes a day. And then some percentage it takes longer because we need to do some back and forth. Yeah. So this is just an element of the, you've built the risk management, fraud detection, using AI and LMs to automate that stuff. So it's like when I first sign up, the first page of the application process, that's a couple of pages, I enter my company name and click enter.

1:31:47Turner Novak:and then you're immediately the wheel, the spinning wheel that I might be seeing at the end of the application, you're like doing it throughout. Yeah, a core dimension of product development at Stripe is finding a way to responsibly, you know, as a steward of the ecosystem, bend like partner and regulatory space time. Like this notion that partners will always insist upon this data or, you know, the sort of the consensus is that you have to do these things. If you step back and say, what are people solving for? they tend to be solving for trust and safety, risk management on their side. And what we found is we really started investing in risk management was that it wasn't that others were really good at it.

1:32:30In many cases, there were printed PDFs being reviewed in basements. It was they were just taking a much more conservative stance than we were in thinking about what it would require to be good at risk management. And so the idea was you have to do this. And the fact of the matter was with the right technology, you don't. So I actually feel like in most cases, we are better at managing risk than a lot of the partners that we work with. But we have taken a different route together.

1:33:02Turner Novak:Yeah. Do you have, last question, do you have a favorite CEO, founder, business that you just learned from over time or gotten inspiration from over time? This could even be like going back to Roman Empire type or more recently, just like any time throughout history. It's a guy named Alan Mulally, who was CEO of Boeing and then Ford. And I think his system and his operating model and his way of thinking has always been very inspiring to me. It is this focus on what he refers to as relentless implementation, but in the context of sort of egoless collaboration and clarity for everyone on the team.

1:33:54I think what he did with Ford was incredible. Because he can't turn around during the financial crisis, if I'm remembering.

1:34:01Turner Novak:Yeah, okay. I think he joined Ford in 2007 or something like that. And I think the share price bottomed out. I think I should look this up at somewhere around$2 a share. And I think when he left, order of eight years later, it's something like$22 a share, something like that. So I think just an incredible operator and very inspiring people leader. Well, this is a lot of fun. Anything you want to plug on your end, people follow you on the internet anywhere? The best way to follow me is to follow everything we're doing at Stripe. There's a lot more coming just in the past month. We've launched the Agente Commerce Protocol, Instant Checkout with ChatGPT, launched something called OpenIssuance at Bridge, which is a platform to issue your own stablecoin.

1:34:49So for example, Phantom, maybe the most beloved crypto wallet in the world, is launching Phantom Cash, which is their own stablecoin, OpenLoop, can buy it in DeFi pools built on top of OpenIssuance. we've launched, as I mentioned earlier, Klarna and Link. A whole lot more. So, you know, stay tuned to everything coming out of Stripe. Always eager for feedback. You can slide into my DMs or email me. I'm WG at Stripe. Thanks for having me. It's been really fun.

1:35:17Turner Novak:Yeah. Yeah. This is awesome. Thanks for doing it. Thank you. And thank you for listening. A quick thanks again to Numeral and Amplitude for supporting this episode. Head to numeral.com for the fastest, easiest way to stay compliant with US sales tax and global VAT and to amplitude.com slash AI dash feedback to start listening to your customers at scale. If you missed it, make sure to check out last week's episode with Roger Ehrenberg on everything he learned returning multiple 10x funds to his investors and why he started a new fund to invest in sports game changers ventures. If you don't want to miss a future episode of the show, subscribe to my newsletter, The Split, linked in the description to get each episode plus a transcript emailed directly to your inbox every week.

1:35:57Turner Novak:Thanks again for listening. See you next time.