Stripe president and co-founder John Collison talks with Recode's Jason Del Rey about what's next for the online payments company, including international expansion and its experiment in machine learning, dubbed "Radar." To help it combat fraud, Stripe shows its users why Radar flagged a certain purchase as untrustworthy. Collison also discusses how he evaluates Apple Pay and Android Pay and why Stripe is interested in emerging technologies like Amazon Alexa.
United States


00:00:00hi I'm cara Swisher executive editor of recode thanks for listening to recode replay here's one of the interviews from the stage of the October edition of the code calmer series in Las Vegas if you like this interview please leave us a review at I tunes dot com slash
00:00:15recode replay so we've had a full day of talk about payments any commerce and retail and you and I had a brief conversation on the phone the other day and we came to the conclusion that that this we're gonna tell us something else right now which is the
00:00:29A. I. hype machine and you either of you maybe that was my phrase so let's talk about the A. I. hype machine there's there's a lot of noise right now both I mean in payments businesses and basically any sector you want about artificial intelligence how it's disrupting business
00:00:48is already I I know for a fact there are investors that really do not know what they're even investing in right now but you put a I like that you know more than a dozen times in the deck you got my five million dollars so what I mean
00:01:03interview from a company that I'm shore %HESITATION is looking at the space closely what's real what's not on how how do you evaluate what's going on right now shirt so I am I will get into the album first can I say the chairs yes pretty I sewed the
00:01:18chat now if you guys been to recode event before like that the chairs are thing Adam and that that that they lay in the two thousand seven interview with %HESITATION with festive jobs and Bill Gates the very famous one ad that says when the very few that it
00:01:32together they had the red chairs and I didn't realize you had like muggles said these are actually not a are the real ones I was just gonna make a joke by the case they are still okay that that'd be embarrassing thing lance yeah by the money back so
00:01:48okay so yeah a I am this is interesting for me because at least when you when you live in the valley it feels like you can kind of you know you can cross the road without at you know bumping into three a I start ups and everyone no
00:02:01matter what they're doing is a is an a I start up these days I'm I'm so you you actually have to start peeling apart and it feels like all the trends we've been hearing about you know were promised big data at over the past five years it is
00:02:15and that's sort of the same thing and what does it mean these days and it's interesting because I guess like any of these big trends like mobile laws in in two thousand five two thousand ten and there is there's a bunch of truth and then as a bunch
00:02:27of hype and it's it's it's hard to pull them apart a bit I have been down to the money twenty twenty show four by presumes a bunch of A. I. there and did the thing that's the stuff that's real and that we think is is really interesting is
00:02:41one we have just made a bunch of advances in industrial machine learning and knowing how to do machine learning well out scale on large corpse of data for for interesting things like what strike use it for is at its fraud detection and so we can get into that
00:02:58a bit later but we're just getting much better progressively as a as a society and be much more data to to train the models on which makes them more actors and the other thing that's real is %HESITATION all the %HESITATION that the deep learning advances we've made over
00:03:12the past five years and so you know this is the famous I you know Google is not really good at recognizing images of caps which is good because a lot of us in the international am add that they also had the the famous video of ad deep mines
00:03:25playing that I I Atari break out and get a really good bass I'm bad as all this basically there is and this technique called deep learning fire it's it's and determine your own network has been around since nineteen fifties and %HESITATION it's a deep networks of the many
00:03:41layers in us and for the longest problem they just had the I'm the problem of how they would learn very well and then add that there was this online at contest for people to train their ad deep networks and some very scary to me add because I mean
00:03:57never better recognizing cats but am at so at they're trying their their their deep networks and at all of a sudden in about twenty twelve we got good **** at deep networks and this is where the kind of Google photos at recognizing images of faces stuff comes after
00:04:13out of is actually a bunch of really interesting advances that fall out of that one at were very good out relatively cheaply at recognizing photos and recognizing kind of things like faces from videos and very good a text to speech and a speech to text as a result
00:04:28and we haven't even seen all the results of that like did mine just published an early %HESITATION at results from their from their text to speech stuff what that means and as I think right now we're going to see all that all these %HESITATION %HESITATION didn't in new
00:04:41use cases follows as a result and so you know you're just talking about us at you know that the use case that'll be awesome of an app that tells you if you wore something to to go meet with someone else see the the other day it actually you
00:04:53know just literally five years ago that would have been pretty hard from %HESITATION from any I perspective and now that's the kind of act that that that you can make fairly easily from that perspective and so we're we're pretty excited about all the the things that are going
00:05:05to come out of basically much better image recognition much better am voice recognition say talk about everything that's why that's working but I what I thought we were going to get you know they're gonna call out some some some pieces of %HESITATION a stuff that that's out there
00:05:21as as a fraudulent or hype but out I I just I as a reporter trying to cover the space it's it's pretty hard from the outset I mean chat bot this in chat bot that and I'm just wondering if if that noise affects your business at all or
00:05:38orgy in terms of focusing on what what where you guys should be spending your time and energy or or you early or do you have your mind made up on on how affects your business already we we trying not to pay too much attention to the the hype
00:05:53cycles I come along because you know you've all seen that the Gartner hype cycle curve that there's this massive sweet shop at the beginning and then you know the plateau of productivity which is much lower than the hyped on for gas kind of comes along later and I
00:06:05know you've all these things you know people ask me what are vis our strategy for it's like what am and I'm so we try not to pay too much attention to the to that kind of stuff especially because we're not at risk of running out of work in
00:06:20our long term trends basically in the US %HESITATION you know we spent the past five years expanding stripe internationally in connecting more places there's a bunch more work to be done there there are many more countries to to %HESITATION to to light up and you know a bunch
00:06:33of merging our pretty hard verse beta testing stripe in Brazil and Mexico I mean that's the some pretty are pretty not he challenges in in getting those under way and similarly with our with our business pot from things like outlets and so we we tend to stick more
00:06:47to those things and then people you strive for really interesting end applications which can includes %HESITATION chat bots and stuff like this but we are not directly a kind of on the consumer there if that makes sense got it so let's let's talk about the core of of
00:07:00stripes business today for a second I'm you know what's all this about all chat bots when when we talk to develop you know you talk to developers you'll you'll hear a lot of love for striped when I talk to %HESITATION I'd say more old school people who have
00:07:15grown up in the payments industry some of them will look at strife in say five billion dollar valuation %HESITATION this is a tough business with tough margins I'm I'm gonna say the C. word which %HESITATION is commodity you know increasingly not easy word in increasingly commoditized business you
00:07:38know just can't can't describe just grow as he commerce grows and at the same pace and %HESITATION is that really a five billion dollar business or is there some break out into a new business lines that we haven't seen yet and that and five years from now we'll
00:07:51look at stripe inside of this isn't just the payments company this is a are already use a operating system of you know for it for developers you know everyone's an operating system or how how do you how do you think about I'm sure you get maybe you don't
00:08:05get your face but how do you think about the sort of commodity the commodity angle and and wear stripes real value comes from god that don't worry we've raised at several rounds of fundraising for stripe and so the question is come up just said just once or twice
00:08:19and so this is the one I will say you know that that there is not some add grounds a rabbit out of the house second stage first right that you haven't seen yes %HESITATION or if there is Patrick who told me about it at and %HESITATION the and
00:08:37so we kinda happily talk about what's in our future and we think those trends are actually really important and and and are going to become a big business but there isn't any you know wild have it off in the future and and so the question we often gas
00:08:54for just some variant of isn't this commodity isn't this an interesting people have been doing penance for a long time that a lot of people in the payments space am isn't a winner takes all markets which actually contradictory statements at where we we get all these sorts of
00:09:05of questions and I'm I think there is a few things at play here one is that we think very few companies are actually taking the global commerce opportunity and the global interconnected body seriously enough and the reason they're not is because in many cases the market isn't Terry
00:09:30asked and so that the economists market or yeah exactly it is you kind of just justified on on existing market statistics and so we are now launching stripe in all these places like we are like at work beta testing in Hong Kong were beta testing in Mexico you
00:09:45know if we were just working on near term loss maximizes our return on on kind of development at first we would not be going into doing those things however we think that part of the reason that you don't see it as much cross border trade is maybe you
00:09:59should is because the commerce infrastructure has been dreadful for the longest time and you know one of the big trends we talk about which were increasingly investing and is moving beyond just credit card payments and so we have been is up and running for ideal which is this
00:10:11local payment method in the Netherlands for banks but debits in Europe for you know we have our partnership with Ali pay in in China but we we think just the fact that if you want to start a business tomorrow to sell to it you know internet users generally
00:10:22the factor that isn't really possible is is to us really surprising and the markets that doesn't exist yes because that hasn't happened so so that is one multi year area of investment for us and so that's kind of that I loved and your your member at has led
00:10:38the master plan on their blog at like since about ten years ago where they talked about that the secret has what kind of you know step one produced a roadster and step to the model **** in the model three and and it's a little bit like that would
00:10:50strive for that this is the secret master plans are one it is the global part two is an what what when we have these conversations at with say investors and %HESITATION about stripe who invariably get the the response of you know %HESITATION payments really crowded space you know
00:11:08off a lot of people doing this admirable margin right to talk to you know terrible mark to be in and then it they are our most effective retort that would honestly be if you actually went and talked to any developer or any entrepreneur building a business online you
00:11:24know all the the companies the kinds of companies Kristin mentioned back in you know twenty ten you you go talk to these companies and say what's doing the payments like and they were tearing their hair out oftentimes you have companies who we're dealing with really interesting industry changing
00:11:38products and re heart technologies into accepting money for what they build with the hardest thing they they did and so it was interesting fact you think it's instructive if anyone is looking for ideas for companies to start I think is a good place to search is where you
00:11:52have on the one hand to the industry observers and kind of the common received wisdom being like %HESITATION that's create really crowded lots of people are doing this but then we have to go talk to the customers in the markets like they're they're they're really unhappy and so
00:12:03we started off making I'm accepting money easy if you know literally give me an API that you know I can use to charge credit cards and put cash my bank account quickly what we realized was %HESITATION that it will work that one of the %HESITATION products founders I
00:12:18I really like is is does trainer from intercom enough to follow his base that much am but at the he's a big fan of this jobs to be hired at framework for products that you know what what is the job to customers hiring your product to do and
00:12:31that would strive to generally nas looking to hire a credit card credit card processor they're building a subscription E. commerce business or they're building an on demand marketplace or something like that and accepting credit card payments is like ten percent of the work that's at the actually that
00:12:47actually goes into running that write a business and so the developer platform for building on the business that that intuitively made sense to us developers we had no idea if it would work because I mean what to be no I've literally nineteen at the time and were set
00:13:03up stripes get no experience in paper or commerce or anything is one of my first job and and but but I think is actually prove to be a a rich scene that we have gone and launched out you know stride connect for market places in our subscription offering
00:13:18an right atlas from creation last week with the launch of that reference to stripe radar which is our exposing all our machine learning systems that we trained on huge amount of striped data so %HESITATION okay so the answer to that enter to commodity question is go talk go
00:13:34talk to the customers and or the or the cloudy that money thing is just is B. S. and and because I mean what what I'll go back to one of your products that you launched maybe you maybe over a year ago which was something you call straight relay
00:13:50which was essentially trying to help %HESITATION on one end help retailers and merchants sell their products on to platforms that aren't necessarily commerce platforms the platforms where people are spending a lot of time so one of your early partner speak platform was Twitter %HESITATION since moved back up
00:14:09since backed off from commerce a bit and then the other side your platforms that felt like they they could %HESITATION layer on commerce and so when I saw that I said to myself %HESITATION maybe they've tapped out on their core business you know you have a lot of
00:14:24a lot of the big names that customers are on demand companies venture capital for on demand is and what it was back then so I said from you know is this is this sort of a you know reaching for growth %HESITATION but it seems like that business that
00:14:40that one product is still sort of in it in its infancy some so was I was I reading that right or what what am I confused about their yeah I I I I think you were reading it wrong and in the US at well what we'll just to
00:14:56say I hear that like once or twice a day once once at work once at home so this promise me the right to say that but and but %HESITATION what when you can see that the core customer base one D. am there's obviously availability bias in bass the
00:15:11at the start of the the companies on stripe that people talk about tend to be the well known companies those are the the ad that that that kind of the memorable names but one of the things that I love about stripe as you know we now look into
00:15:23the corridor exactly that the companies that are are very well known in the valley in a very fast growing things like that I'm you know those are those of regular customers and we work closely with them that said that there are now these hundreds of thousands of really
00:15:36interesting businesses built on stripe across you know the twenty five countries where we operate and now through Astrid three stripe op listen even more countries at and order things that never ceases to get me excited is the fact that this is the variety you see an ad in
00:15:52those sorts of in that those sorts companies building on stripe and so it's it's on demand companies like like instant cars fast I got all the headlines but this company is like you guys probably haven't heard of cattle which is out on demand construction equipment and so if
00:16:07you just need a new backhoe for it for the day and %HESITATION yeah that you can just log on to get a hold a common you know it handles the payments and handles the reviews and everything like that and so this is really interesting long tail of of
00:16:20services and companies that that we get really excited about as well it's not just the the hip ones and add to it to the real question so this is still a space that we are very interested and I was gonna say really interested in but I need to
00:16:33do something with us and so and one and one as you know that I'm I'm so I'm skeptical about sure the at the idea that people are going to increasingly shop where they haven't shopped before but where they're spending maybe entertainment time or %HESITATION I don't know I
00:16:50I try to tell myself I'm on Twitter for work but really it's it's an addiction and it but it is enterprise at and entertainment addiction as well so yeah I mean I cut you off but I just want to express my skepticism unless in case it wasn't clear
00:17:05about my question so so I think when a again going back to the the Gartner hype cycle you know it would definitely went through one of these for and I think I called south while we're in is remember had that adds New York thing add that we're on
00:17:19stage us and I said the hype cycle yeah I am and those kind of mid point during the hype cycle that at that for example everyone talks about how you would while scrolling through your feeds and see something and then stop and buy it right there it's not
00:17:35that that would be very you know fundamentally different kind of purchasing that you're willing to act kind of make impulse purchase purchases that quickly am hold a scoring through Twitter Facebook fees at what really is bad for us is it you personally agree it's a safe statement to
00:17:53make bass large existing companies with lots of assets to bring to bear on on on %HESITATION on these sorts of problems at all the innovation will come from them right that's that that's probably pretty easy in that you know insta cars to pull food did not come up
00:18:10with in store car store at insert card did I you labor did not come up with dollar shave club ocean club that we we think that's a fairly safe Trent about on at and one of the things that we think the existing companies will will need to our
00:18:24and want to do is from a a buying behavior pattern not put everyone through the the the the web properties and I'm over property they've developed because honestly oftentimes they're not that good and I'm not saying anything too controversial here because they'll tell you themselves are not that
00:18:40good and the conversion data backs this up for you know add that conversion rates on mobile tend to be you know many times lower than desktop which are many times lower than at an in store in that if you have a fifteen percent conversion rate on on mobile
00:18:53which wouldn't raise any anybody's eyebrows in the retail space I mean just picture last in in a retail sense right you know I might need to store and people get to the checkout line and eighty five percent of those people the check out line like ask you know
00:19:04what remind and at like you be fired at and so we think that that the current desktop web mobile web pattern has to change in your start gender apple pan things like that but we also think will be a new wave of %HESITATION we're very bullish on that
00:19:20that kind of shop style and lists the the the the the the the dedicated fashion sites that people really passion about fashion spend it on we're at we're really interesting companies like wish things like this but that the the mood is going to change and you know it's
00:19:35not chat bots but maybe I'm not Alexa is really interesting you know I I'm I'm being on the show floor but I hear this all sorts of kind of interesting new stuff new items are going to emerge and so you know it when things are defined stripe is
00:19:49the focus on developer is this is basically a development case but you already have so if I think what I heard was you know the new commerce platforms that pop up may not it may not be Twitter but and it and maybe it's Facebook maybe it's not but
00:20:08there there will be a host of these were people are spending a lot of time engaging where products not transacting today but you're you're betting that they will be that there will be enough of these platforms were people will start transacting that that it's worth there Sir all
00:20:24the effort and and money you're putting into yes and don't forget asked if they might even be internal platforms that you cut yourself like I'm really has been Alegre's in that now they're all that we have all these stripe users and all these conversations going but you know
00:20:37we might have had a conversation with two years ago and so you know people like Macy's and and and Best Buy and I I'm kind of larger retailers like this at an often what's of interest is there is a set of third party platforms that they'd like to
00:20:50work with that you know they see a lot of referral traffic coming from the they think they can partner with them on a more interesting experience but even if you're looking to build your own application within your own ecosystem at again API a flying everything you have so
00:21:06it's easy to build new things on top but we think that's a pretty safe bet I mentioned the five billion dollar valuation earlier journalists kinda get hung up on these be yeah %HESITATION and I'm gonna bring up another company in the payments space that mostly brick and mortar
00:21:21but %HESITATION square and %HESITATION you know a lot of differences in the businesses but also but when you look at sort of the core way make money which is off of a transaction similar someone during you know they went out as a public company last year kind of
00:21:40%HESITATION got hammered for a bit and now it's been up and down when you see when you see someone broadly in payments %HESITATION go through that does that change how you think about what the future of stripe is whether it's eventually owned by another company versus going public
00:22:00%HESITATION what anytime I think you're trying to draw patterns out of too much data it's like the the stargazing and the constellations and it's like and yet that is the warrior with the actions like a bunch of dots and and Adam staring at a bunch of dumb what
00:22:16well I think everyone knows this newly public companies at because of the way the timing of various things work that you've the institutional investors and then you have kind of lock ups expiring and and the the by in demand patterns shift in fairly predictable behaviors that you overly
00:22:31the charts of all recent tech the I. IPOs on I'm touch each other they all follow the same curve basically just they go out and then they like this thing to go down and they eventually got us movie go back up and so I think if you're going
00:22:44public at you you probably want to you know make clear to everyone that you don't think the stock price is going to settle down for for for for two or three years and all that CIOS I've I've spoken to of companies that have gone public and say dust
00:22:59is is kind of a hard thing to get across but it's really necessary because you go from a world where at any stock price changes are very you know this move and and well dampened two worlds where it's literally fluctuating around every day Adam but I think it's
00:23:14possible to create far too much %HESITATION %HESITATION that to try and read too many stories out of that does data points that's my job that's my job done so %HESITATION so company you probably won't tell me what you're probably once I don't even know the question is how
00:23:29can a great that's a great lead in by the journalist %HESITATION so I'm gonna say stripe as ten ten tens of billions of dollars of volume %HESITATION is is an IPO something that you guys think about and whether you want to be %HESITATION executives running a public company
00:23:49is it's way too early to think about that and it's not something that we think about that were you can you see some of these at the stories from %HESITATION %HESITATION diagnose any guys read Madeline that brick controller at he tried talks about people that you know that
00:24:09all these unicorns and they live in the enchanted forest of the unicorns bluer than I was at my eye with the prospect of my like at in the recent %HESITATION %HESITATION some events it's %HESITATION that will happen blasts at but no I mean right now I don't feel
00:24:28like for for for my own point of view it's it's something that ranks really high on the bucket list to do this thing and we have plenty of medium term business objectives and so we're not looking for an act like that we're very happy right stripes on term
00:24:41independent you know you know you have venture capitalists investors right all right yeah all right so that's what we'll take that as a non answer I one more thing before I turn it out to a queue and add the queue in a from the audience %HESITATION you mention
00:24:57apple pay briefly %HESITATION you obviously work with your merchant your your apps that are your customers to get them up to speed on apple pay and android pay and I don't know other but there's there's a pay day basically now but what let's not talk about those for
00:25:14a second apple pays come to the web %HESITATION what have you seen among your %HESITATION customers in terms of uptake merchants wanted to add that and also what effect it's actually having on on buying on the on the mobile web I am yeah I think it is easy
00:25:32to get lost in all these an ounce means that tend to happen fast I am it's hard to pick out the trends that are meaningful and so I'll I'll do my best to to quickly summarize and and and pick them out for you am add the the the
00:25:49the by far and away the most I'm having meaningful change in the in the general payments ecosystem out over the past say a year or two has be an apple android pay and I will be on the web because again to go back to that fast you know
00:26:04example of if you're an online retailer who has fifteen percent conversion rate on mobile it's it's it's totally industry standard and totally abysmal and and it's actually hurting the kinds of things that can happen you know this is why you see this am services being pushed up and
00:26:21ops and things like that and so the fact that apple pay that apple and android are working on fixing this is huge because that you know that they're there operas such a large in terms of number accounts and everything like that they own the OS and the and
00:26:34the hardware and so you know our our thesis when these were being released is like wow this is a really big deal am I'm the data we've seen has has borne that out at you know all the the merchants are gonna talk about some data sure at I
00:26:47mean indiegogo at saw a two point five X. conversion left at when they %HESITATION for apple pay customers I won I won hard number you want to numbers yeah I mean we get to go to the absolute numbers but I I mean to two point five axis pretty
00:26:59yeah is pretty significant into car senior users check out fifty percent faster and I often look to ask one of the one of the most underrated to and in my mind most interesting commerce companies these days is wish I think everyone turns up their nose a bit at
00:27:15them because I like the the items they sell are are every cheap and and there's this kind of %HESITATION at least I see them I think being at being underestimated their phenomenally good execute arrest are phenomenally data driven and when I am curious to see what's out and
00:27:31very few people of cracks that the mall phenomenon of %HESITATION sure shopping and browsing without intent for those those who don't know which %HESITATION hugely popular out outside the U. S. %HESITATION also %HESITATION in pockets of the US as well and is basically a market and online marketplace
00:27:50out that's regularly like the number two %HESITATION popular show if you're spending to the app store charts I mean you don't have to go driving that far it's am it's it's always near the top there and they are they're re impressive executed and they're really data driven and
00:28:04so when things I do is when I'm trying to see you know what's coming next I just go see what bush is doing because you know that that they they they they probably run experiments justifies and so one thing I noticed was fast for regular customers at on
00:28:17an iPhone six say who have apple T. enabled directly just turned off all other payment it's like you to just at the bottom to buy something this is like a big honking apple pay button and that to me is is is a little bit of a of a
00:28:29sign of things to come and so out of each deal out of hand there will be a huge deal I'm sure we have some questions from the audience %HESITATION we gotta do am and you're like five last questions I feel like that's a recall yeah cara that wears
00:28:42care that was great I I do the last question thing too but I'm done %HESITATION sorry here first and then on the way up you got beat okay we'll start here how great is baseball compared to apple pay and then dried bay sorry the second party question is
00:28:58just how would I contrasted bobble by yes okay and so ashes should we say that pay bills competitor because they own Braintree a catcher and so on apple pan android pay I think there is one thing that's interesting is it's two entirely different products experiences and I as
00:29:21under the same brand to answer this that tap your phone to check out and then there is the online payment and so I had oftentimes these two things get confused acts as often the trees and earlier today where you guys probably saw that the rumored news that's at
00:29:37the new macs will have a thumb print reader and %HESITATION and I'm double pay and showing it on the web but I saw someone who did that sad you know don't be that jerk in the checkout line holding everyone up you know using your macbook to pay at
00:29:50whole foods amba that with that kind of speaks to the confusion of the two product experiences that exists and so I think with NFC old reader installation issue and like you never know if the reader is actually wired up for apple pie and so I'm just going kind
00:30:04of obnoxiously tapping my phone off different services am and on the web we've seen much faster adoption or surround you not to see much faster option because there's not much more compelling case from the African version but if you you can see it gently if there if the
00:30:19act is offering you this option but you know uber left instead post mates all the services I mean that they all all kind of the mobile apps this are the top the charts generally am offer us at in terms of PayPal so I mean obviously I'm I'm somewhat
00:30:32biased your because at PayPal is is a competitor to stripe but I think if you look at it on the on just the pure fact to this and that there's a reason that we are a kind of betting on at working you know partnering with the apples and
00:30:46hundreds of the world rather than building our own wallet strategy eyes is the PayPal strategy where at you are invited to set up apple pay when you set up an iPhone and so you have that really high a titration iPhone users that they already have their vast you
00:31:00know high hundreds of millions of acts consumer cards on file and so they were very large existing install base and by virtue of the integration with that the hardware and the the software and and everything they can provide a much better product experience I think I would argue
00:31:15out of a is a much better product sprints and everything that went before and so that's why we're betting on working with the people who can be really good at that and to peace rather than trying to go along it's also part of the stripes strategy that we
00:31:27don't seek to compete on the consumer there we like being a horizontal top form for the merchants where we let them accept money from anyone anywhere and whether that be credit cards directly or Ali Baba paper whatever we are gnostic and so is actually very important that we're
00:31:42not than confusing with our partners and providing our own Wallace because that has these are interesting failure modes down the line her get that sort of channel conflict so we're not going to five years from now roll back the tape one where a net hearing the announcement of
00:31:56the stripe wallet I hope not okay %HESITATION weird someone back here stellar sea are yeah creek more with autonomous %HESITATION you know considering %HESITATION with the W. three C. is working to do %HESITATION and what we see with apple pear browser you know it seems to me that
00:32:13were moving toward removing layers from commerce quickly and flattening the experience essentially creating Amazon one click for every product sold online so what we've seen is almost the the the the the movement of the buy button up to the product page and forgetting about the card experience you
00:32:35know is that something that strife is incredibly focused on in terms of that seems to me it could be the most powerful way to kill off cart abandonment if you don't even let someone think about it when they're on the product page and you actually that those are
00:32:52two examples that I used at various points in the past I I I I kind of agree with you both at this promulgation of new basher identity solutions because let's not forget how ridiculous the current entering your credit card in as I mean literally a a copy of
00:33:05the mail order catalog experience in the nineteen eighties like we presume you should be able to do about it and ask and answer the Amazon one click experience for for everyone that's absolutely how and how we think of it so so radar is your new fraud detection service
00:33:25that right okay again can you speak to your aspirations there because today stripe is pretty much encapsulated in the checkout process you don't have visibility upstream whereas a fraud detection system play is pervasive through all areas of the checkout including up you know when you get to pavement
00:33:44is there a revenue strategy there because today you it as such a sin touched upon Amos is a commoditized business is this a strategy to move upstream and then to demonstrate that stripe and radar can drive our conversions and therefore monetize based on that or what are your
00:34:03plans there so our our thinking with radar is one I would say we don't seek to just get into products for the sake of them and I or as hobbies or anything like that you know what we we get into products when we have a real thesis that
00:34:22because watching a product has to be sort of contrarian you know you're you're basically making the statement that the world works like this and we actually think it's work like this and so you need to have some contrarian view point out that the that the current world is
00:34:33wrong in some way as with radar wouldn't just want to to launch into space without us and any kind of product pieces and so over the past two years we now learn a lot about what merchants tend to do what works well but doesn't one we think it's
00:34:48at from a product experience in a brand experience point of view it's very natural for this to be integrated into stride in that imagine I was mad and I was telling you on strike without radar right it's like oh it's it's really easy way to accept payments are
00:35:00like that sounds awesome is like and do you want some of the payments just randomly call back for no reason at all like we know that sounds horrible and but but that's kind of the experience that you gas at will without any kind of a good fraud system
00:35:11and so we think it's very nice the way in which it's it's very natural and expected to be bundled in with AT with stripes the other thing then is that we have in stripe at this stage in twenty sixteen we have a huge amount of data that we
00:35:25can bring to bear on on fraud and so anything anytime or trying to determine whether something is fraudulent you're basically saying that's not right for you know that that that's not what I would've expected their habit you you're spotting anomalies answer spot knowledge you have to need to
00:35:38have some idea of the baseline and we're now at the stage that's when the transaction happens on stripe on average we seen that car to six times before and so it was only to have a pretty good idea of the baseline raise and can start to to spot
00:35:50things than what we we went in dad's was the old one of the problems you tend to see what machinery that goes on today is %HESITATION it's very hard for people to actually understand what's going on I think this one the frustrations that we all have with machine
00:36:08learning systems it's like you're traveling and your card is randomly blocks by your bank and it's like you knew I was traveling like why is this so hard for you or like all these horror stories of merchants whose you know funds were frozen by PayPal and just like
00:36:20your your that that that kind of the random acts of machine learning systems are very frustrating and so we didn't want a system that was off on supervise working in the background that people can understand and so a huge amount the development effort that went into radar was
00:36:34actually taking all this data that we have the stripe network training very high perform machine learning models honest but then actually exposing the results of that decision to the user and so we're not trying to just abstract all the complexity away from you will say we thought that
00:36:48this transaction was suspicious because at across the strait network we've see in the and number of attempted transactions from this I. P. address in the past twenty four hours which is that you know across a number of different cards and that's not normal behavior and so we kind
00:37:03of take our unique product belief and the data we have and the fact that doesn't require any integration work and now I think that's a product that we can actually feel good about I think part of the question maybe I missed it maybe I'm wrong was is this
00:37:18a differentiator for the course right product or is this a new business was that order is our so and that there is address some users for whom I like you know are larger users who tends to kind of custom pricing deals to some users for whom we are
00:37:30selling it separately as an out on service and so there is that case for most people we just want to kind of layers into the stripe experience and use it to kind of continue to make strike a better product for them and so yeah you can kind of
00:37:42cool products experience constant and less revenue at or you can hold a revenue constant and lift product experience regarding both in different areas but for the vast majority of users we just want to keep having stripe do this bundle of stuff that gets better and so a lot
00:37:56of our future product launches will also be that that way are gonna take one more question if we have one %HESITATION straight in the back %HESITATION go here for market I know John we're talking with his earlier on I would use looking back in hindsight I would you
00:38:10critique your product strategy it's right like John backed out of the bed you know you can like going direction of like thing you would do if you speak up just a little bit sorry go to market here how would you take your product strategy and thrive looking back
00:38:22at the five five years and to unpack got a little bit you could either go in directions like things you would do differently are perhaps things that you would do it if you did not do and that's a really interesting question I do much these and are being
00:38:36asked that one before and so I think part of the strength of striped but then the you know the critique which I'll get to in a second Aberhart of the strength of stripe is at the prom is very do the somewhat deliberately at nerve at vibe about as
00:38:56in that there is yet code samples on the homepage are kind of unabashed about striking a technical product that you need to add to integrase %HESITATION %HESITATION in our API to using gas at value from us and the long term as we look five ten years that there's
00:39:10going to be really big direction for us where which is acquired this company run kids that were really excited about it which is a way of executing Java script code in the in the browser and Java script as you know about a measure of the most popular programming
00:39:23language in the world and so it's a way of with zero sat up people getting started at building code snippets and then they can integrate them into applications from the internet the I this is like a big direction for isn't a big deal that said if I were
00:39:35to critique as of the past five years I think the areas where we have had products adopted more slowly than we wanted or where we had you know struggled for a few years buying our head against a wall before we really cracked something was we weren't meeting people
00:39:52halfway you know we were just talking about the technical platform and we weren't able to speak in the language of people who are trying to accomplish some business I come you know maybe that the general manager of a line of business or the product manager for something and
00:40:06we were kind of speaking over here in terms the developers understood and enjoys but we were not good at speaking to vast at have you general manager a product manager for for for quite awhile I think we're gradually getting better at that and honestly that we're gonna that
00:40:20it's something that hopefully will continue to get better over the next year too but I think that nerdy this was was a blessing and a curse and a lot of ways I think that's a pretty good place to wrap up so John really appreciate you coming out to
00:40:33thank you for joining us tonight thanks for listening to recode replay remember to leave us a review it I tunes dot com slash recode replay and be sure to check out our other podcasts every Monday I host Rico decode a podcast about tech immediate key players big ideas
00:40:48and how they're changing the world we live in on Thursdays you can hear recode media in which Peter Kafka interviews the smartest and most interesting people in the media world and on Friday I host too embarrassed to ask along with Lauren good of the verge you can find
00:41:01all the shows and more at re code dot net or wherever you listen to your podcasts

Transcribed by algorithms. Report Errata


Enjoy sessions from past events like Code/Media and the renowned Code Conference, along with other interviews hosted by Re/code journalists. Featured episodes include candid conversations with comedian Chelsea Handler, entrepreneur and "Shark Tank" star Mark Cuban, Snapchat CEO Evan Spiegel, former Twitter CEO Dick Costolo and presidential candidate Hillary Clinton.
United States
189 episodes
since Jun, 2015
Disclaimer: The podcast and artwork embedded on this page are from Recode, which is the property of its owner and not affiliated with or endorsed by Listen Notes, Inc.


Thank you for helping to keep the podcast database up to date.