The Secret Behind Stripe’s Atlas: Onboarding as a Service
With no previous hustle, Stripe suddenly unveiled Atlas to the world – showing how it can support foreign companies in speeding up their process of becoming an American operation, and quickly start charging with Stripe. The selected companies won’t need to address complicated issues such as incorporating a Delaware company, reducing legal and financial risk, and getting US$ 15,000 in infrastructure credits from Amazon. Stripe will provide all that for only US$ 500.
The question in everyone’s minds was “Brilliant! Why hasn’t any e-payment platform thought about this before?”. However, this is an end-user perspective. What Stripe is really doing, from a company perspective, is trying out a simple idea that can drammatically shake a startup’s world: Onboarding as a Service, or OaaS.
Onboarding: soothing users in
Every business needs a constant stream of new customers. The fastest they understand the value of a particular product among its competitors, the highest their potential as future loyal customers. You can’t love a product you don’t use, and won’t advocate for a service you don’t love.
The process of soothing in prospects and leads and trying to transform them into customers is called onboarding. On most startups, onboarding is delegated to the marketing team – either integrated with an inbound channel or sales representative. There are several tactics to increase efficiency on this process – such as lead scoring, top-of-funnel content marketing, and others. What Stripe did different was finding a key pain point of its prospects and create a multidisciplinary team to give them what they need. By packaging processes that are usually done offline, Stripe offered something considerably valuable for practically no cost.
What startups can learn from Atlas
Stripe knew about this pain point for a long time, but most startups aren’t aware of all the small things that prevent prospects from adopting their product or service. That understanding only comes as a consequence of a thorough and strategic analysis that is (maybe) easier for unicorns than for earlier-stage startups.
For Atlas, Stripe gets a US$ 500 deduction to its CAC (Customer Acquisition Cost) whenever a customer is selected. The secret then lies in three key issues:
- The costs and expenses (from the onboarding team salaries to the incorporation expenses) have to be paid for in the future, and the partner credits (such as AWS’s) help increase the value of Atlas without additional costs
- Controlling the growth scale, so the OaaS won’t need constant boosts of HR to comply with the lead demand
- Making sure the drop rate isn’t high, and that the LTV (LifeTime Value) of the Atlas customers by far surpasses their CAC
Stripe solved those with an invite-only format. The result is (probably, since I don’t have access to numbers) tens of thousands new international leads in only a couple of days, for the cost of a conference participation… Another result is that the company doesn’t have to release Atlas adoption metrics unless they’re very good (after all, it’s a beta service and invite-only). And the most beautiful thing of all: Stripe disguised an intricated onboarding internal process as a value-adding service that solves a deeper layer of its very own problem/solution fit.
OaaS strongly justifies itself when a startup wants to diversify customer segments, expand geographically, or just increase market reach. What I believe: any startup should use Stripe’s example to devise their own OaaS strategy and kick competition in the ass. Now think, no matter the stage of your startup: what is your OaaS MVP?