Stripe launches new Atlas tool that takes the friction out of issuing stock

1 Nov 2017

From left: Limerick brothers and Stripe founders John and Patrick Collison. Image: Stripe

Stock issuance is getting programmatic as Stripe’s Atlas adds new functionality.

Is there anything those Collison brothers don’t think of? The Stripe founders have just gone and created a stock issuance tool for Atlas users.

The new tool enables founders to generate, review, sign and store a full set of stock issuance documents based on customised templates from start-up law firm Orrick.

‘Just as Stripe Atlas took the friction out of incorporation, this tool aims to streamline this confusing – and costly – stock issuance process for founders everywhere’

A technical guide to allocating stock developed in collaboration with Orrick has also been added to the Stripe Atlas guides to help founders navigate the process.

Atlas, which was unveiled at Mobile World Congress earlier this year, enables entrepreneurs from anywhere in the world to set up in the US. Stripe gives them US incorporation status as well as a US bank account.

It is a kind of API-style approach to a fundamental set of business problems. The toolkit enables businesses targeting the US to partner with Silicon Valley Bank for financing, Orrick for legal and Amazon Web Services for cloud.

While the internet is borderless, the reality is that selling across borders is a bureaucratic nightmare. Atlas takes care of frictions such as incorporating in Delaware, opening a US bank account with a tax ID number and creating a Stripe account to accept payments.

Speaking with yesterday, Silicon Valley Bank’s managing director for early-stage banking, Claire Lee, who worked with Stripe on developing the onboarding API, said that the Atlas platform takes a process that could last weeks or months, and reduces it down to minutes.

Taking stock

Stripe, which was recently valued at $9bn, is emerging as one of America’s fastest-growing tech brands, and is hurtling steadily towards becoming a 1,000-person company.

The company’s platform is becoming a major payments brand within the US market and, with Atlas, Stripe is gaining a new kind of velocity in enabling small businesses and start-ups to grow online.

Just like with being able to incorporate and trade online, the issuing of stock is a vital part of starting a company.

“Correctly issued stock establishes the founders’ stake in the long-term success of the company, protects the company’s intellectual property and defines what happens if any of the founders leave,” explained Stripe product manager Alex Kehayias.

“It’s also an exceedingly tricky process, and it’s not uncommon for start-ups to spend thousands of dollars on legal bills figuring this out (or potentially tens of thousands to correct mistakes after the fact!)

“Just as Stripe Atlas took the friction out of incorporation, this tool aims to streamline this confusing – and costly – stock issuance process for founders everywhere,” Kehayias said.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years