Not-for-profit crowdfunding platform Chuffed.org is an online space for socially-conscious global projects, allowing individuals, other not-for-profits, social enterprises, and community groups to run crowdfunding campaigns for free.
The Victorian-based startup had the idea and the market, but their CEO Prashan Paramanathan said he was missing one thing: A merchant facility to be able to take and pay donations.
Having previously approached the big four banks in Australia to implement a merchant facility, Paramanathan told ZDNet that none of them were willing to give Chuffed a go, as he said the banks saw marketplace models as "too risky".
"Add to that that we were raising funds for charities -- which they see as a high risk sector -- and it became impossible," Paramanathan said. "The closest we came was one of the big banks that would only give us a facility with a AU$100,000 security deposit."
Paramanathan's take on it was that banks did not really know how to think about risk for online businesses in general.
After six months of negotiation, Paramanathan said Chuffed was able to convince Macquarie Bank to give it a payments facility that despite being very restrictive also only let them on-board tax-deductible registered charities, which was only 5 percent of the non-profit market.
Chuffed also looked into PayPal, but the payments giant follows a three-month on-boarding process for charities that requires them to submit documentation and statutory declarations before it will consider giving out an account, Paramanathan explained.
Similarly, Chuffed customers also had to undergo the three-month process themselves with PayPal.
"Even when they were approved, their accounts were often randomly limited by PayPal which was incredibly frustrating for them," Paramanathan said.
Enter payments startup Stripe. Paramanathan said implementing the Californian company's payment integration platform took five minutes.
"And that's probably because I typed slowly," Paramanathan joked.
"It meant we didn't need to sign three-year contracts with a merchant facility and a separate payment gateway. Stripe also offered a very secure service with fraud protection too. Simply put, there is no easy way we would have been able to go global without Stripe."
When Chuffed started using Stripe, Paramanathan said the company was two people in Victoria processing millions of dollars of donations from 12 countries.
"Pre-Stripe, we would've had to set up bank accounts and merchant facilities in each of those countries, or used a very expensive and clunky intermediary," he said.
"With Stripe Connect, our campaigners can just fill in a very short form, and then they can start taking donations."
Chuffed has been growing 100 percent-year-on-year and has just passed AU$10 million in donations, with donors from 152 countries donating to campaigns in six different currencies.
One of Chuffed's customers, Edgar's Mission, a small sanctuary for rescued farmed animals an hour north of Melbourne, was attempting to raise AU$50,000 to move facilities due to the influx in animals requiring a humane space to live.
"They ended up raising AU$160,000, but more interestingly, their 1,787 donors came from 17 countries. For a small non-profit with one site and less than 10 staff, being able to get donations and transact them seamlessly from donors in 17 countries is extraordinary," Paramanathan said.
"It's hard to overstate just how painful it was pre-Stripe setting up a merchant facility and payment gateway ... plus the layers of bureaucracy made it really expensive and then you had to do it all over again in each country you operated in.
"To me, the best part of the business is the potential to change the broader commercial economy into a social good economy."
Speaking at Stripe's second Australian birthday bash in Sydney on Friday, Stripe co-founder John Collison said a platform like Stripe was really obvious in foresight, especially when he and his co-founder brother Patrick were themselves in the market for something like Stripe.
"Talking to anyone who had actually been in the target market who had gone through the experience of building an online business, to them the idea of something like Stripe was blindingly obvious," Collison said.
Collison said the pair set out to fix how online businesses could quickly and easily accept payments from 25 countries in 130-plus currencies, as well as Apple Pay, Android Pay, Alipay, and Bitcoin.
In the six years since the Collison brothers created the Stripe platform, the startup has seen the likes of Twitter, Kickstarter, Shopify, Salesforce, and Lyft join its customer base.
To date, Stripe has received around $300 million in funding from investors including Sequoia Capital, Thrive Capital, Kleiner Perkins Caulfield & Byers, Visa, American Express, and Paypal founders Peter Thiel, Max Levchin, and Elon Musk.