TechCrunch Disrupt Europe: Berlin 2013 | Crossing the Enterprise Chasm: Andy McLoughlin (Huddle), Niklas Adalberth (Klarna), Mikkel Svane (Zendesk). Photo: TechCrunch | FlickrCC.
The Internet was going to be one great big digital department store. No actual brick and mortar building was required. It promised easy money and a hassle-free day for business owners. But providing customers with easy online sales has proved to be a difficult promise to guarantee. Online merchants want to offer—and online shoppers want experience—simple, safe, and secure sales.
PayPal, Stripe, and Klarna are three promising companies that have revived hopes for easy Internet sales and service. They understand that customers want to know that a trustworthy and stable company is selling the product or service they’re purchasing. This niche is showing so much promise that Anton Levy, managing director at General Atlantic, is on Klarna’s Board of Directors.
A customer at a traditional store would bring the items they wanted to purchase to the cashier when they were done shopping. The same thing happens when a customer is shopping within an online store. Merchants and customers have to use an online payment service to exchange money electronically over the Internet. An online payment service allows a business to receive payment from any customer with an email account. Here are some details about three leading companies in this industry:
PayPal
This American company provides an online payment system to the world. It’s one of the large Internet companies and creates profit by charging a fee for processing online sales from vendors or auction sites. The company moved $228 billion in 2014 and became independent from its parent company eBay on July 18th of this year.
Stripe
Currently valued at $5 billion, this startup was launched 2010 by brothers Patrick and John Collison. Success as teenagers in the app industry taught them that accepting online payments from customers was still a pain point for many businesses. Developers simply add a few lines of code to the Stripe app, and they can take payment from anyone, anywhere. Of course there is a small transaction fee. The potential profits from that fee have attracted funding from Visa, Apple, and Alibaba.
Klarna
This Swedish digital checkout service will be launching in the US soon with about 10 companies. Their service is rather unique. They pay the merchant for the sale and then collect the payment directly from the customer. Customers shopping on a site using Klarna provide a zip code and an email address to check out. It’s that easy and—the company claims—remarkably resistant to fraud. Look for their buy buttons on Twitter and Facebook.
