(upbeat music)
So, you've heard today everything that we're launching
to grow revenue, reduce costs,
and better help you serve your own customers.
In today's talk, Katelyn and I are going to dive deep
in to what we're launching for platforms and marketplaces
to build embedded payments and finance businesses.
We're constantly working with platforms and marketplaces
to help them solve the problems that they care about most.
And we're ultimately in the business
of helping platforms and marketplaces be successful.
But being successful can be difficult.
You have to change your business strategy constantly
to adapt to changing customer preferences and market conditions,
while simultaneously managing a complex tech stack.
That's where Stripe comes in.
At Stripe we solve the pain points of payment and revenue friction
so that you don't have to.
We give you access to enterprise scale at startup speeds.
Connect is Stripe's solution for platforms and marketplaces
to build embedded payments and finance businesses.
Connect powers over 13,000 platforms and marketplaces
and enables over 8 million businesses around the world.
It has been the market-leading solution in this space for over a decade.
Connect is built on top of Stripe's modular, flexible,
and extensible infrastructure.
This means when you build on Connect, you get access to global payments,
embedded payments, and finance capabilities,
and revenue and finance automation tools, straight out of the box.
At Connect, we are deeply inspired by what we hear from our customers
and what you've told us is that you have four key pain points
along your embedded payments and finance journey.
First, you want to be able to seamlessly embed payments
into your product.
Second, you want to be able to increase and optimize your payments margin.
Third, you want to be able to access merchant insights and better tools
so that you can manage risk.
And fourth,
you want to be able to quickly resolve customer issues related to payments.
In this talk, we're going to cover
how our roadmap addresses these four key pain points
for platforms and marketplaces.
We'll wrap our talk with a conversation with one of our own customers
who will share some of the key lessons that he has
in his embedded payments journey.
[Angela] All right, let's go ahead-- [Katelyn] Wait, Angela.
My engineering team would definitely like me to mention
that like with any plan,
some of the things that we're going to talk about today
are subject to change.
That's fair.
Okay, great. Now, let's get started
by talking about embedding payments into your product.
Platforms and marketplaces spend tons of time and resources
designing their product experiences.
And when it comes time to embed payments, you want to get to market quickly
with experiences that feel native, matching the look and feel of your brand.
But with tons of projects on your roadmap,
you don't have six months or three to four engineers
to throw at the problem of embedding payments.
So, eventually, you want to manage first in support,
and you haven't built out the teams to own that yet either.
With our embedded components,
you can now build a fully white-labeled experience
in as little as eight weeks, with as few as one or two engineers
rather than a whole team or two.
We've taken the experiences that we've crafted
from years of feedback and iteration
and empowered you to embed them directly in your apps.
Embedded components let you skip MVP and go straight to market
with a fully featured payments experience
that feels completely native to your product.
Each component is customizable to reflect your brand.
If you decide to have Stripe manage risk and support,
you don't need to compromise your user experience in order to do so.
You can offload risk management to Stripe
and let your users resolve risk and verification issues
directly from within your app.
You can rely on our risk models for ongoing detection,
while leveraging prebuilt UIs that have been finely tuned
to maximize good user conversion.
Today, we announced several new embedded components
that you can now integrate with your product.
From onboarding and notifications to account management and payouts,
these are nine critical financial workflows
that you no longer have to build from scratch.
Whether you're brand new to payments
or you're filling gaps in an existing payments integration,
we also want you to be able to embed advanced payment workflows,
with embedded components like local payment methods settings,
giving your users access to 18 payment methods
and the ability to manage their preferences
with just a few clicks or apps,
allowing you to easily embed integration with third-party tools or Tax,
helping our users calculate, collect, and remit sales taxes.
We're also extending this functionality across the breadth of Stripe products,
making it easier to expand into financial services
beyond just payments.
With embedded components,
you can give your users access to capital loans, expense cards,
and financial accounts.
We're invested in making it easier than ever
to embed payments and financial services with a great user experience in no time.
And it's been incredible to see how our customers
have already taken advantage of embedded components
regardless of where they're at on their payments journey.
SaaS platform, MYOB,
added embedded components to their existing integration,
allowing them to effectively fill gaps in their user experience.
This used to be incredibly expensive and time consuming,
but now you can launch much faster and keep your maintenance costs low.
Okay. So, now that you've built a payments experience,
you now want to be able to increase and optimize your payments margin,
but doing so can be pretty difficult.
It's not only difficult because it's technically challenging
to implement a payments pricing scheme,
but it's also difficult because you want to be able to evaluate
how that pricing scheme is working against your bottom line.
So, we're making that easier for you by introducing no-code pricing tools.
With no-code pricing tools, you can now go into your Stripe Dashboard
and build your own payments pricing scheme.
You can create fixed, variable, and blended fee structures,
and you can set pricing rules
for different payment methods, geographies, and individual customers.
Once you've created your payments pricing scheme
within your Stripe Dashboard,
we'll integrate all the rules that you've set
and charge your customers the appropriate fees.
There's nothing else you have to do.
Okay. So, once you've created your payments pricing scheme,
you want to be able to evaluate how performant it is
against your bottom line.
But doing so can, again, be rather difficult.
So, we're introducing margin reports to make that easier as well.
With margin reports,
you'll have the full visibility into your revenues and your costs.
You'll see a breakdown of your revenue and cost
at a platform, transaction, and customer level.
So, with pricing tools and margin reports, platforms and marketplaces
can now design, implement, and evaluate their payments pricing strategies.
Over the next couple of months,
you'll see us add additional functionality into this area,
including the ability to schedule pricing campaigns,
give you greater visibility into your payments costs,
and give you the ability to emulate Stripe sticker pricing.
As we continue to advance in this area,
you'll just find it easier than ever
to be able to increase and optimize your payments margin.
So, once you've optimized your payments margin,
you'll next want to take on managing risk.
But risk is challenging for platforms and marketplaces.
It's challenging because platforms and marketplaces
have to manage risk for their users, not just their own direct business risk.
So, when you take on managing risk, you have to solve some hard problems.
How do you make sure that the accounts you're onboarding
are actually legitimate?
How do you monitor to make sure that an account on your platform
isn't about to go out of business?
Solving these problems is resource-intensive and really painful.
You've told us that you want more robust information
from Stripe to help you better manage risk.
So we're introducing fraud signals.
Fraud signals help you identify potentially high risk merchants
by leveraging data from across the entire Stripe network.
Fraud signals include categories of fraud scores,
fraud indicators that are contributing to each fraud score,
and account-level analytics for disputes, declines, and refunds.
With fraud signals,
we're giving you more robust information to help you better manage risk.
You've also told us
that you want to streamline your merchant risk operations.
A key pain point is being able to collect additional information from your users
to help verify them.
So, now, from within the Stripe Dashboard,
you can actually go ahead
and request that information from your users,
including documentation and selfies
in order to better verify their identities.
With easier verification,
you can now balance fast growth for your business
with effective fraud mitigation.
You've also told us that once you've been able to identify
whether a merchant poses a risk to your business,
you want to have more controls to be able to take action.
From the Stripe Dashboard,
you'll be able to block bank accounts and debit cards
if they're suspected to potentially be fraudulent.
And this restriction applies across your entire platform.
So, if you onboard more users
that use the exact same bank account information,
their payouts will automatically be blocked.
And you've also told us
that you want to be able to take action programmatically.
So, we're introducing the ability to restrict charges or payouts
programmatically with the Risk Controls API,
in addition to being able to do so from directly within the Stripe Dashboard.
Throughout this year and into next,
we're going to continue expanding these tools.
We're going to build more controls, including the ability to reject accounts
with nonzero balances, set risk reserves, and adjust payout timing.
We're going to be servicing recommended risk actions,
and we're going to be enabling proactive detection
with notifications and alerts.
We want you to be able to access more insights and tools
to help you better manage risk,
so that you can balance growing your business
with effective risk mitigation.
And lastly, you told us
you want to be able to quickly resolve customer issues
when it's related to payment support.
For a lot of platforms and marketplaces,
it makes sense to offload payment support directly to Stripe.
This helps you launch faster
or just manage your business more efficiently.
While this is typically pretty cost-effective,
it can mean a reduction in transparency in the customer support journey
because the customer is now traversing two parties:
Stripe and the platform itself.
Well, this year, we're completely changing that.
We're giving platforms and marketplaces the ability to follow their customers
through the entire support journey
by giving them access to Stripe customer support cases.
Now, in the Stripe Dashboard,
you'll be able to see the support cases for your customers for the last 90 days.
You'll be able to view individual conversations
that your customers are having directly with Stripe support.
And crucially, you'll be able to assist your customers
in getting unblocked by reaching out to Stripe on their behalf
and providing supporting documentation or additional context.
We recently gave this feature to ecommerce platform WooCommerce,
and they absolutely loved it.
They said they were able to finally see the ability
for their customers to interact directly with Stripe,
and again, give them that end-to-end view of their customer journey.
It's helped their teams become more efficient
and it's helped their customers just get back quickly to selling online.
So, in today's talk, you heard about the four key pain points
that our roadmap is solving for platforms and marketplaces
on their embedded payments and finance journey.
We want to extend a huge thank you to all of our customers
for sharing their feedback and for building with us.
We are ultimately in the business of helping make all of you successful.
We want to enable you to solve the problems that you care about
for your customers.
As part of that conversation, so many of you to have told us
that it's really important for you to be a one-stop shop
for your customer's needs.
Well, Stripe is here to help with that as well.
Across our broad portfolio suite, we offer all capabilities you'll need
to become the one-stop shop that you would want to be.
Whether that's unifying omnichannel payments
or providing access to financing
or enabling advanced money movement cases,
Stripe is here to help you build whatever you want to build.
So, now, Katelyn is going to have a conversation
with one of our customers.
He is the head of commercial at Squarespace,
and he's had decades of experience
building really successful embedded payments businesses.
Please help me in welcoming Dan Chandre to the stage.
(audience applauding) (upbeat music)
Hey, Dan.
Awesome. Thank you, Dan, for joining us.
Thank you, Katelyn.
So, we talked about how we align our roadmap
with our customer needs.
How does that approach resonate with what you're working on
at Squarespace?
Yeah, I mean, a lot of it resonates.
I think one of the things I saw this morning
that I don't know that Stripe took enough credit for
that I wanted to call out,
there was a slide at one point where, and I forget who was presenting,
showed the different historical iterations of Connect
that there were Standard and Express and Custom.
And then, there was a slide that just showed Connect.
That was my dream come true. That meant everything.
There was so much that we were trying to navigate
between the different capabilities on different things that were offered.
So, that alone was something I've been trying to work with Stripe on
for many years,
I was so happy to see that come to fruition.
But then the next one I'd say right in line with that
is what you were talking about today with embedded components.
I think embedded components resonate with us
because we know the level of effort that goes into creating these interfaces
for our customers.
And being able to eliminate that.
And it gives us the opportunity to obviously move quicker,
but it gives us the opportunity to experiment a little bit,
make quick iterations.
I will say, as much as I love embedded components,
they're also incredibly frustrating for me
because it seems right after I build an interface,
the embedded component comes out and I'm just sitting there going, "God,"
it's because I asked for that that you get--
But no, in all seriousness, I think in a few different iterations
of building a completely white-label payment solution
where we've built those interfaces, our journey on that path isn't done.
So, for example, at Squarespace,
we just launched Squarespace Payments in October of 2023.
We've been ramping that solution.
And most of the interfaces we built ourselves.
We did use a hosted onboarding,
but our plan had always been to move from hosted onboarding
to our own custom onboarding.
Well, we've pivoted, right?
Now, we can move from hosted onboarding to embedded onboarding.
So, that's a great example of how even though we've already had a solution,
we don't want to consider that like a corner we've painted ourselves into.
We still want to leverage the embedded components.
And then, Squarespace Payments on the Squarespace platform
is really our first step.
We also have other distinct platforms that we own and operate
like Acuity Scheduling and Talk,
where we plan to bring Squarespace Payments into that fold.
I don't want to build that interface all over again.
Now, I can leverage the embedded components.
Yep. And we hear that from users all the time.
Especially, I'm glad you called out onboarding.
Onboarding in particular is so challenging.
We showed it in the keynote this morning in more detail,
but especially as you're expanding internationally,
there's more and more requirements that you have to be able to collect.
And so, onboarding has been a big one for users
to not have to build themselves.
Awesome. So,
in your experience, scaling successful payments business
at Booker, at Mindbody, and now at Squarespace,
what do you think platforms and marketplaces
who are embedding payments often underestimate?
This is a great question because I think
embedded payments as a concept is a bit of a,
for a lot of vertical SaaS or just SaaS in general,
is a bit of a shiny object in its first concept,
to people who really understand the impact that can have on the business.
But what I've experienced,
one of the biggest underestimating that I've done
is the requirement for what I would call organizational alignment.
Because everybody in this room,
and maybe nobody outside of this room in their organizations,
is deeply embedded in this space.
For example, at Mindbody,
payments was a utility that was primarily used to drive revenue.
At Squarespace, it was a utility that was a necessity.
And so, born in the DNA of both these companies
wasn't a deeply rich and embedded payment experience
that could drive incremental customer value.
So, you have to somewhat become a salesperson
of this for your SaaS business.
I'll never forget at Squarespace, my CFO asking me,
"Well, when is payments done?"
And I said, "Well, what do you mean?" He's like, "When is the investment done?"
I'm like, "It doesn't work that way."
And so, having to lay out the ongoing need
to continue to iterate and improve in all of that,
you have to educate because the DNA in this room
is not always a DNA in SaaS companies at broad.
So, that organizational alignment is not only a one-time,
get approval to build your embedded payment solutions,
it's ongoing.
So, after we launched Squarespace Payments,
I'm back on the road show
talking about launching Squarespace Capital,
and I'm back on the road show talking about what the next thing can be.
And the more organizational alignment you have,
the better your go-to market is,
the better your customer penetration will be, all of that.
So, you have to become the champion
of embedded, both payments, finance, all of that
within your company.
[Katelyn] Yep. That's a great one. [Dan] I mean, that's one.
Other things that I think we've underestimated is
in certain organizations, especially at Squarespace, for example,
where we are a--
There's not a lot of,
I'd say person-to-person customer touchpoints of urgency.
We offer support, but we're not on the phone with them.
We're supporting their website,
which is critical to what they're doing,
but not hypercritical, is what I could say.
Once you are part of the transaction, you have transitioned to hypercritical.
And so you have to shift to what I call like an always-on mentality,
both from a support and engineering perspective.
If you're a non-mission critical SaaS platform,
and I don't say that in any sort of negative way,
but how somebody lives and breathes their business,
and then you add payment,
you're shifting your dynamic with that customer,
and you are of different consequence now.
So, you have to think about that.
You have to staff accordingly,
and you have to have a model that really accommodates that.
I would say the other thing is what I mentioned
kind of that conversation that I was having with our CFO,
which is that, as you scale a payment stack,
the need to staff that comes with it.
And that has to do with both just general scalability issues,
customer growth, all of that.
It's not this one-and-done experience.
And I think that sometimes that is grossly underestimated
in how you need to build in what is the expense side of this business
to offset what I would call hopefully the revenue side,
but more importantly the customer side of the business.
Yeah, that makes a lot of sense.
And how do you think about scaling? Like, you're starting out
and you kind of have staffing at a certain level,
but how do you think about that scaling?
Well, you have to think about scalability first.
I think the problem that a lot of companies get to
is they're very focused at getting something in market, right?
The challenge is, let's get to market.
Even if you look at some of the selling points
of embedded components,
it's get to market in eight weeks.
Well, that's great. What happens once you're in market?
And if you start that planning at the wrong stage,
you're not going to have a really solid three to five year financial plan
that implicates the cost that it takes to build all of this.
So, if you don't start at scale, or at least scale thinking,
it's going to be a negative experience internally for you as an operator
as you go on.
So, it's really about building that scale
into the overall thesis of what you're trying to build
and doing that from the beginning.
It's great to leverage partners on what that scale could be,
but also leverage the industry.
It's great opportunity to speak to others who have done it,
to see where their pitfalls are.
It's one of the things I gain most from opportunities like this,
which is sitting down with other platforms.
We always like to say we want to get all the platforms
in a room without Stripe and then bring Stripe in
so we can tell them
all the conspiratorial things we've come up with.
But it's also to say, what are you dealing with right now?
And so, I know this is a little bit of a tangent
from just about scalability,
but there's a lot of value in those who have tried to build this before.
And the challenges though, are unique and they're new
and we're seeing new things in fraud.
So, I think building a community of also payment experts
or payment platform experts is really valuable.
Yeah, that makes a lot of sense.
And in that kind of like scaling and being operationally ready,
one of the things we talked about a bit today was risk.
I would love to hear a little bit
about how you've thought about risk operations.
Yeah, I've thought too much about risk operations,
unfortunately. (Katelyn laughing)
So, I have two very distinct experiences with risk operations.
When I came to Mindbody, we had a risk group.
And so, they were a high-functioning, really an excellent group
that was really strong on the merchant fraud side.
And so it was really how I cut my teeth
learning about what that organization needs to look like.
But at least there was a DNA within the organization
about what risk tolerance was within the organization,
and then the necessity to protect yourself against bad outcomes.
Squarespace, on the other hand, which had no real,
what I would call "payments DNA" throughout the organization,
had no risk group.
So, we had to build it from scratch.
And that was a very different experience because risk scales with volume.
And so this is a really tricky one
where you're going to see things as your volume scales
that you didn't see or plan for in the beginning.
And there's a decision to be made as a platform
of do you want to build this or not?
And I think, I want to go back to my Connect block comment.
This is a great evolution of Stripe,
where picking and choosing the components of Connect
that you wanted to use previously was not possible.
And so, you had to be down a very particular path
if you wanted to do Stripe-managed risk.
And if all the boxes didn't fit what you were looking for,
that didn't work.
So, I applaud Stripe now that that has been opened up.
If I could have done it over just at Squarespace,
I probably would've started there.
I probably would've started saying, "Stripe, why don't you manage risk as we scale?"
Because I want to build a risk org for scale,
and the signals change over time.
And, but again, we get that timing issue of like,
at what time were we ready to go versus not?
But I think one of the things that is really exciting about this field
is there is a lot of new technology in this area
that is helping us to identify nefarious merchants upfront
or bad actors upfront and what we can do.
And then, Stripe gives us enough tools throughout the funnel of acceptance payout
to mitigate signals that we may see along the path.
But it's an ever-changing, ever-challenging world
that I wish I didn't participate in as much as I do.
Yep, yep. (Katelyn laughing)
Yeah, there really is no one-size-fits-all when it comes to risk
and you've gotta be ready to scale.
So, that's great. Awesome.
So, what myths would you like to dispel
for anyone here who is looking to embed payments
in their product experience?
Yeah, I love this one. There's a lot of myths to dispel.
I think the first one, and this one I think is just top line,
the most important myth to dispel about embedded payments,
and that is that it's about revenue.
I think if you're a SaaS company
and you're simply saying, "We need to increase our revenue
and we're going to do it through embedded payments,"
you've already lost.
That makes no sense.
If embedding payment solves an identifiable customer problem
or improves a customer experience
or allows you the pathway to offering products
that are what your customer is looking for,
then you're on the right path.
But I have way too many times seen companies that are just,
"We want to go from a rev share over here where we get 40 basis points,"
"We want to go to 80 basis points, so we're going to embed payments."
That's not a good enough reason, sorry.
You're going to spend easily that amount of money
to build that organization, to build this muscle,
to implement all of this, just to drive some top line revenue,
and it's not going to deliver value.
What we saw at Squarespace was we wanted to deliver an experience
that was germane to the platform that they're spending their time in,
as opposed to making them go to different places to reconcile.
We wanted that to be in the platform that they're using day to day.
And then, we wanted to stick to who we are as a company.
Squarespace, one of our models
that we believe in a world where everyone can be an entrepreneur.
And so, what does that mean for an individual
to be an entrepreneur?
We believe it has a lot to do with their growth,
their ability to find a space
where they can actually exhibit whatever their dream is.
But then, we have to be the platform that helps them scale that.
So, when I think about the role then that payments plays in that,
it's that we want to be the one that's closest to helping them
not only pull their money
from the activity in which they're driving,
but then grow that money through things like instant payouts
for access to capital
or maybe capital to help them grow their business.
But we don't have any control of that when it's all outside of our platform.
We want to use the signals
that we receive from our customers on their,
let's say we're monitoring their order growth over time,
and we starting to see an inflection
in how successful they are in whatever they're selling,
that could be a service, it could be a good.
That could be an indicator to us
that that's the time that they need working capital
and we offer them capital in a way that can help them grow their business.
We can also see a variety of trends in this data
now that it's internal to our platform,
that we can give them all of their kinds of signals
of products that we offer,
whether that be a campaign product or a digital content product,
to help them grow their business.
But once we pulled the transaction into the platform,
that's why we're doing it.
So, that went all the way back to the myth of dispelling that it's about revenue.
Because at the end of the day,
and this is the part that I would not tell my CFO.
If I were to fully balance sheet this out,
I don't know that it's revenue accretive for us.
I don't. That's not the point.
The point is it's a better and sticky experience.
One that's gonna help our customers grow, and that's why we're in business.
So, that's one myth I would dispel.
The other one
I think there are a variety of SaaS companies
that get into embedded payments because it's the hot thing.
This reminds me of when everybody wanted to be a payfac
and they had no idea what that meant.
And it's like pay--
And like going to summits, love to label themselves fintech,
no offense to anybody in the crowd, but it's a lot of jargon
and jargon just doesn't matter at the end of the day
because jargon is not how you got your embedded
or your installed customer base. It's not.
You got there because there was a distinct thing you did
for that customer
that you're better at than your competition.
And so that's why you should be doing these things.
Let that drive your reason for embedding payments.
Don't do it because the street thinks you should,
or your investors think you should
because you get a tick on your multiple because you can say you're in FinTech.
I think that's a really, just, that's the wrong reason to do it.
And the only other myth I would dispel is that question of it's a one-time spike.
We're going to do this
and it's going to take us nine months and we'll be done.
I can't get away from that conversation because it's just not.
You have to make sure that this becomes part of your DNA
and you're making that type of investment as an organization.
So, it's not an offshoot, it's not a side project, it's not a lark.
It's gotta be part of your core value prop that you're delivering to your customers.
Yep. That makes a lot of sense. And it's really common.
We see it a lot from new platforms and marketplaces,
"It's a spike and then we'll be done." It's not going to be done.
Awesome. Dan, we love asking our users, if you had a magic wand,
what is one thing that you would wish for from Stripe?
(Dan laughing) That's a dangerous question.
How much time do we have? No, I'm just kidding.
So, the interesting thing here,
I feel like in the last three years maybe
or so working with Stripe,
I have had the opportunity to try to do just that
and have had surprising amount of success.
So, and I mean that wholeheartedly, that I think Stripe,
what I've seen last year and this year through Sessions
and other areas of what you've dedicated engineering resources and time to
are what you're hearing from your customers.
I do, I honestly believe that.
And one of the example I'll call out and where I would wave my wand
is something that all the way back to my Mindbody days
that was really, I was really interested in
is that Stripe has historically operated as a closed ecosystem.
And I understand why. It makes perfect sense, right?
But at the same time, that's like a purist approach
as if our platforms were built that way.
A lot of our platforms, we started with one process or PSP
and moved to another and moved to another,
and now we're building our future with Stripe,
but we still have all of this, right?
And so for Stripe to embrace the idea
of what you're doing with Vault and Forward
is really interesting to me.
But if I could wave my magic wand,
that would be true across the platform and data moving in both directions.
And what I mean by that is,
when I look at Stripe Capital as an opportunity,
I would love to reference third-party data into Stripe Capital
to make broader lending decisions.
Because not all of our customers
drive all of their GMV through our platform.
So, I want to say, here's who you are as a merchant
and let's make a capital offer based on that,
[Dan] not just your Stripe volume. [Katelyn] Yeah.
So, that would be my magic wand I think if,
I mean, I've got a long list, as many know,
but I've been most pleased with the fact
that a couple waves of that wand have come true.
Awesome. Yeah, I love that.
There's a lot of opportunity to leverage the network
and hopefully, we'll be able to tap into that
and we'll be talking about some of that at Sessions 2025.
Well, Dan, thank you so much for this insightful conversation.
This has been great.
And for platforms and marketplaces in the audience today,
we hope this conversation has been valuable
and we hope your look at our roadmap has been valuable.
If you'd like to see some of the things that we preview today,
please stop by the platforms and marketplaces demo desk downstairs.
But otherwise, thank you for coming.
Thank you. (audience applauding)
(upbeat music)