The reason is: larger businesses will require more payment options than Stripe offers.
India? Adyen got you covered: [1] Philippines? Yup, everything [2], including offline payments in stores [3]. Mobile payments in Africa? No worries [4] And so on and so forth. On their payment site they don't even list all payment methods, there are so many. You search for a country or a payment method, and they show what's available.
Stripe has a very long way to go to realistically compete with Adyen.
[1] https://www.adyen.com/payment-methods#pmx=india
[2] https://www.adyen.com/payment-methods#pmx=the-philippines
[3] https://www.adyen.com/payment-methods#pmx=convenience-stores...
[4] https://www.adyen.com/payment-methods#pmx=mobile-network-ope...
Adyen seems to implement every payment method you can think of. And if you don’t want to implement them, their white label payment page is able to dynamically show payment methods based on user location and merchant preferences.
No support for point payments (like RakutenEdy payment), neither Linepay, Rakupay, Merpay, Paypay and other QR payment providers, nor Suica or Pasmo pay, and this is still just the tip of the iceberg what's available in Japan and missing in Adyen (Nanaco, Waon, dPay, auPay, etc). Just saying, before you drink too much of that kool-aid.
I would assume it's lacking similarly in other markets too.
I'm drinking Adyen kool-aid because I worked for a company that needed payment methods in Japan, and in India, and in Korea, and in Latin America, and in Europe.
Adyen provides all that. Yes, they will not have 100% of local providers, but it's still 100% better than any competition.
Source: Worked in software for payments processing a couple billions a year.
This is much more known now but not as known 6-10 years ago and guess who was very aggressive at maximizing this before I saw Stripe make a solid effort at this...
They've also got some of the highest quality transaction volume, who is doing a chargeback on Netflix? Nobody. Lot of possibilities down the road when you have access to this kind of volume.
Large corporations are the larger, wealthier segment.
A big chunk of "startup business strategies" ignore this market. This makes a lot of sense for a startup. You don't really care what the bigger market is as a startup, you care what market is easier to access. Assuming the market is big (eg online payments), the size of the market isn't a limiting factor.
That works in-context. I'f you're trying to build a startup, landing a multi-year contract with a big company is a bad angle for multiple reasons. Not always, but mostly in the generic case. Long sales cycles. Checklist feature demands. Custom features. Besides being hard for most founders, it pushes in the wrong directions. Meanwhile, who cares if you're addressing a $3bn market or a $800bn market. Both of those are big enough for a startup aiming for $8m in revenue. Your problem is sucking and failure, not pyrrhic victories.
Also, if you are successful enough, small markets become big markets. When Google IPO-ed, they competed with yellow pages for mom-n-pop business & such.
OTOH, most of the market is large companies, governments, etc. That's reality, and it means something. Now that VCs fund startups so generously, a common pattern is bootstrapping in a shallow pond... then jumping into the main pond once you have momentum.
EG, Having a "developer cult" mentality, like stripe, at your base will serve you in the long term. Enterprise developers do have influence. It's never what makes a decision, but it can be a favourable wind.
And because you made a deal with them when you had no leverage, the terms will also be awful, and difficult to renegotiate. So you have to go try to increase margins off of smaller customers, all with a product that looks like what the person you aren't making money off of wanted it to look like.
Hypothetically speaking, of course. Because I definitely for sure did not work for a place who tried to go big too soon and ended up with a modest exit.
Stripe dominates the hobby & startup segments with the hope that those companies will, someday, become very successful. Now, any company at a certain size will be able to switch between payment processors with little cost, but Stripe still has that initial relationship. They certainly have the opportunity to grow business with their current relationships over time, and in some ways more than Adyen can.
Additionally, Stripe will always work to get more payment methods & exist in more countries. It's always some work to do so, but number of payment methods isn't insurmountable, and it's only a matter of time before Stripe & Adyen are difficult to distinguish between their offerings.
Lastly, Stripe has a lot of breadth of products compared to Adyen. Stripe Sigma alone is a huge value add that a regular "insights platform" lacks. There's a lot here to unpack, for sure.
Even for big B2B corps, it's the difference between a project you can lead on your own and get credit for it, or something that will go upper in the chain because of all the approvals you need for it.
In a previous life, to get an Adyen contract and dev. environment and then the prod credentials, it took us something like 3 months, and we had a smaller PSP integrated for a different project in the meantime. That meant that for any project we didn't have as much volume, we'd go though faster PSPs instead of reusing the Adyen connection.
Actually looks like 43B EUR, so $50B.
That hasn't been our experience at all. In our case (a few years back, they might've improved in the meantime) Adyen experience was pretty lousy. Not especially bad, but average - considering many payment gateway APIs were as bad.
In contrast, Stripe was (at the same time, and continues to this day) miles ahead, a pure developer delight. Properly documented, with working API wrappers, working examples, correct API responses. It just worked as expected and was easy to understand.
Unfortunately I don't recall specifics with Adyen as it was a while back, but I know we were pretty unhappy with it. To this day I've never looked at it again, while I recommend Stripe to anyone in position to use it.
Very unlikely, as both markets (smb payments and enterprise payments) is unlimited, there is a few chance they will try to compete with each other. On the other hand almost no company is able to be a leader in both the smb and enterprise space, because as you mentioned it, the cultures need to be different, the customer support need to be different, the product need to be different,... More info here : https://blog.luap.info/why-most-saas-companies-cant-be-succe...
Concur, Microsoft Office, GSuite, Tableau, DocuSign, Salesforce, Adobe, Slack and Zoom to name a few.
What? There are only so many companies in need of (or open to changing) payment processing software at a given time. When it comes to larger firms, those numbers get smaller. That's the opposite of unlimited.
AMEX and Discover's transaction costs are a percent higher on Adyen, and I can't actually tell what Mastercard or Visa will charge since it is obfuscated. The cherry on top is the FAQ at the bottom that describes what interchange++ is but doesn't actually tell you a range of fees that it can be. I guess it's cool to see in detail all the middle men taking a cut of my revenue, but I'm way more concerned about the actual amount that is being taken out ahead of time instead of it being a surprise for every transaction.
[0] https://www.adyen.com/pricing?navItem=northamerica [1] https://stripe.com/pricing
The page I agree is confusing.
edit: Looking at their (listed) acquiring and processing fees, Stripe appears to be cheaper
That said, I don't know how Adyen's support is, but sadly Stripe's is honestly absolutely crap. Every single support interaction I've had with them has been incredibly slow and incredibly painful.
Adyen for example for Mastercard: €0,10 + Interchange++ (average total 0.90% - 1.10%)
Stripe advertised in Europe for Mastercard: €0,25 + 1.4% of transaction.
I live there. There's a decent but not great startup culture. The services infrastructure is fantastic and there are many massive multinationals based here.
Not only I discovered my company uses it, but plenty of other business I interact on a daily basis (from the market to utility-ish services) do.
And their slogan "Our mission is to increase the GDP of the internet" https://stripe.com/about also alludes to the strategy of helping actually create more online businesses, as opposed to just getting all online businesses to use Stripe.
We were processing a few millions a year at that time, which is quite small by enterprise standards. No idea how much volume it was years before when the company started using Adyen, I imagine not a lot.
Stripe’s current, (private) valuation is $36B. Developers love them. Adyen’s current, public valuation is $43B (they IPO’d amongst little press coverage). Most developers don’t know about them.
So what is the difference? Market strategy. Adyen only goes after large businesses and has something many others, including Stripe cannot compete with efficiently: (far) lower pricing, higher market coverage.
The developer experience for Adyen is decent - no complaints, perhaps a bit less “magical”. They will definitely have a fraction of the customers, but those customers are huge. They get and seek little to no publicity compared to Stripe, yet have built a similarly sized business from the Amsterdam, the Netherlands, which is remarkable.
It’s a completely different market strategy, and company strategy. Read the Adyen values to see how different the two companies are[1] - Adyen putting “merchants” first, with a mention of support, while Stripe prioritizing developers and small businesses. And company culture could not be more different either - saying this as someone who knows both Adyen and Stripe employees. Both are companies to admire, and show that there is no “one” good way to build immense value.
It will be fascinating to see what happens as these two companies expand to compete with each other (meaning Adyen starting to go after small businesses, and Stripe after the largest merchants, with a differentiated pricing model).
[1] https://www.adyen.com/about