5 ms·

Tell HN: Stripe Destroyed My Business

9 points by growmify 5y ago

We were Stripe Connect Platform: growmify.com and had a 100k-150k daily revenue (not transactions, pure revenue) Suddenly, on Friday, Stripe emailed saying they are blocking our account because some companies under our portfolio violating TOS. They could simply block those accounts. Then we appealed to decision, basically people who are violating TOS were selling products that are restricted on some states and we already hired people and built checks to manage risk, decline transactions from those areas We had 200 companies working with us and due to Stripe, not only us but all other 200 companies has been closed. After 2 weeks of review, they simply blocked our platform, even though we asked we are advertising platform, we don't have to work with those sellers, we can simply build filter to block them We tried many times to explain whatever is the issue can be fixed from our side but they just stuck to their decision This is ridiculous, they have this much money in their hand, and instead of fixing core problems like this, they are celebrating increasing checkout conversion by 0.01% With this much money under your access, you should have been able to fix those issues Also I have other friends whose business has been closed the exact same way and many of their businesses failed only but only due to Stripe For reference: https://www.trustpilot.com/review/stripe.com?stars=1 I can't believe that developers out there actually like stripe, this company destroying businesses, only reason you didn't have this experience because your business was small If anyone from Stripe reading this, please fix your platform, we are not doing anything wrong, we built everything and anything possible to comply with your restrictions

anigbrowl 5y ago
It seems like you need help with both your legal strategy and your communications. to be honest I found your explanation and the body text on your site somewhat incoherent and hard to understand.
- growmify 5y ago
  We already have legal team dealing with all legal issues, we auto block any restricted areas, and don't accept any company that has legal issues in any way. What do you mean incoherent? I wrote whatever happened
  - downrightmike 5y ago
    I think they mean that it appears that this is a first pass write up from a frustrated author, so it jumps a bit because the problem is bigger than you've given the background on.
    - growmify 5y ago
      Problem is that some connected accounts in platform were selling CBD which is on restricted business list of Stripe. And we already had systems in place to make sure they don't sell it in areas that are not allowed and they are compliant in terms of regularity perspective They also blocked us in past and reopened due to decline rate being high, we built security layers it went from 20 to 6-7%. We are capable of building whatever is necessary to continue with Stripe. Our platform not necessarily require CBD companies to grow. In less than 4 months, our team were able to grow from 0 to 100-150k a day revenue, of course we can build anything required I don't understand how me being frustrated have anything to do with actual practical problem Stripe blocks many people with this unnecessary reasons while they could be working with them by letting them know what should be done, it is not just us, but many companies For our case, they could simply say, we will work with you as long as you no longer support CBD industry. And we will be more than happy to do so, only thing we would need to do, build auto blocks for CBD and add underwriting guidelines for our team which would take us less than 1-2 days to do so. They can work with us, it is just unreasonable so that they simply don't even consider Another thing frustrating is that, many people praising Stripe, and I am thinking how come they don't see how they are destroying many businesses by simply having bad underwriting practices Then I notices, reason most people like stripe is that, if you don't make money, revenue or have growth, Stripe usually doesn't even care, you don't even notice any issues, so you are happy Once you have growth and revenue, you are in trouble This didn't just happen once to us, we have team members in team and the only reason their business failed was Stripe as well Communication specialist, I don't understand still why it is recommended, making things perfect has huge cost of speed, so doesn't worth it
      - anigbrowl 5y ago
        To be very blunt, your English is not good and fighting the issue in public makes things harder for your attorneys because your public statements are reducing your legal leverage. That's why you should work with a PR person. I guess you are paying a lot of money to your attorneys. Maybe you should ask them them to advise you about how to talk about this in public.
deleted 5y ago
[deleted]
edwinwee 5y ago
I work at Stripe and we've dug into this quite extensively throughout August. Although Stripe does want to support as many businesses as possible, the card networks have prohibited the sale of some products that have regulations around them in certain jurisdictions (https://stripe.com/restricted-businesses#products-or-services-that-are-otherwise-restricted-by-our-financial-partners https://stripe.com/restricted-businesses#products-or-service... — and we're trying to shorten this list of restricted products). I'm not able to share specifics about individual businesses, but broadly, the card networks have a hard line on platforms that continue to primarily facilitate the sale of restricted products.
- growmify 5y ago
  Hi Edwin, I know, but we asked Stripe that we will not work with those companies and build security layers to block them Even though we were willing to work Stripe and only support companies that aren't violating those rules, stripe still didn't want to work with us
- growmify 5y ago
  We could simply start targeting different companies that are supported in Stripe, primary benefits of our product can be used by almost any online business, and it shouldn't has to be restricted products. Practically speaking, Stripe still can work with us and give us warning to never work with those companies, and we can simply start selling our product to other industries
sp322 5y ago
Try https://www.spreedly.com/ https://www.spreedly.com/ or https://www.inai.io/ https://www.inai.io/, otherwise stripe owns your members cards and in turn your customers (it's not feasible to ask every customer to reenter their cards if you need to migrate). I believe they are required to support card data export under PCI however to another card vendor, so hopefully that can help.
purplepatrick 5y ago
I’m not clear if your customers process payments through your Stripe account, but if this is the case (it sounds like it) you need to work with a network that serves “high-risk” customers. There are brokers that can place you with the right network if you have a hard time finding one yourself. You will have to get transparency on the industries of your customers, though, and may have to focus on a couple of them, as otherwise, underwriting you gets very complex. With CBD customers, Stripe is not the right solution for you, no matter what, as they don’t serve “high risk” industries with higher rates of chargebacks and other payment default permutations. Stripe’s way of managing that risk is to kick you out when your chargebacks hit a certain threshold (in exchange for your not having to get fully underwritten as you would if you got your own merchant account). Or you cease being “high-risk”, for example by cutting your own high-risk customers. It sounds like this is what you’ve started doing already. In that, you’ll have to replicate some of what a network would have to do during underwriting, ie look at the industry of your customers and hope that the industry risk will adequately reflect their future chargebacks. That way, you can also filter out the geographic compliance issue at least during signup. In addition, I don’t know how challenging it would be for you to add a lookup table to your data model, but if you’ll continue serving CBD customers that may sell in different states, I’d say that’ll come in handy. Still, if a customer of yours switched to selling high risk stuff all of a sudden, then you’d still have to deal with a fair amount of legal trouble. I would make sure that that kind of scenario is addressed in your customer agreements (eg by having customers agree to needing your approval before adding new product lines from a list of high risk products or disallowing these products right away). I don’t know much about the payment network industry or whether the above address some of your (past) issues, but hopefully some of this is somewhat helpful. I hope you can keep your business going. Good luck!

9 points by growmify 5y ago

anigbrowl 5y ago

It seems like you need help with both your legal strategy and your communications. to be honest I found your explanation and the body text on your site somewhat incoherent and hard to understand.

growmify 5y ago
We already have legal team dealing with all legal issues, we auto block any restricted areas, and don't accept any company that has legal issues in any way. What do you mean incoherent? I wrote whatever happened
- downrightmike 5y ago
  I think they mean that it appears that this is a first pass write up from a frustrated author, so it jumps a bit because the problem is bigger than you've given the background on.
  - growmify 5y ago
    Problem is that some connected accounts in platform were selling CBD which is on restricted business list of Stripe. And we already had systems in place to make sure they don't sell it in areas that are not allowed and they are compliant in terms of regularity perspective They also blocked us in past and reopened due to decline rate being high, we built security layers it went from 20 to 6-7%. We are capable of building whatever is necessary to continue with Stripe. Our platform not necessarily require CBD companies to grow. In less than 4 months, our team were able to grow from 0 to 100-150k a day revenue, of course we can build anything required I don't understand how me being frustrated have anything to do with actual practical problem Stripe blocks many people with this unnecessary reasons while they could be working with them by letting them know what should be done, it is not just us, but many companies For our case, they could simply say, we will work with you as long as you no longer support CBD industry. And we will be more than happy to do so, only thing we would need to do, build auto blocks for CBD and add underwriting guidelines for our team which would take us less than 1-2 days to do so. They can work with us, it is just unreasonable so that they simply don't even consider Another thing frustrating is that, many people praising Stripe, and I am thinking how come they don't see how they are destroying many businesses by simply having bad underwriting practices Then I notices, reason most people like stripe is that, if you don't make money, revenue or have growth, Stripe usually doesn't even care, you don't even notice any issues, so you are happy Once you have growth and revenue, you are in trouble This didn't just happen once to us, we have team members in team and the only reason their business failed was Stripe as well Communication specialist, I don't understand still why it is recommended, making things perfect has huge cost of speed, so doesn't worth it
    - anigbrowl 5y ago
      To be very blunt, your English is not good and fighting the issue in public makes things harder for your attorneys because your public statements are reducing your legal leverage. That's why you should work with a PR person. I guess you are paying a lot of money to your attorneys. Maybe you should ask them them to advise you about how to talk about this in public.

deleted 5y ago

[deleted]

edwinwee 5y ago

I work at Stripe and we've dug into this quite extensively throughout August. Although Stripe does want to support as many businesses as possible, the card networks have prohibited the sale of some products that have regulations around them in certain jurisdictions (https://stripe.com/restricted-businesses#products-or-services-that-are-otherwise-restricted-by-our-financial-partners https://stripe.com/restricted-businesses#products-or-service... — and we're trying to shorten this list of restricted products). I'm not able to share specifics about individual businesses, but broadly, the card networks have a hard line on platforms that continue to primarily facilitate the sale of restricted products.

growmify 5y ago
Hi Edwin, I know, but we asked Stripe that we will not work with those companies and build security layers to block them Even though we were willing to work Stripe and only support companies that aren't violating those rules, stripe still didn't want to work with us
growmify 5y ago
We could simply start targeting different companies that are supported in Stripe, primary benefits of our product can be used by almost any online business, and it shouldn't has to be restricted products. Practically speaking, Stripe still can work with us and give us warning to never work with those companies, and we can simply start selling our product to other industries

sp322 5y ago

Try https://www.spreedly.com/ https://www.spreedly.com/ or https://www.inai.io/ https://www.inai.io/, otherwise stripe owns your members cards and in turn your customers (it's not feasible to ask every customer to reenter their cards if you need to migrate). I believe they are required to support card data export under PCI however to another card vendor, so hopefully that can help.

purplepatrick 5y ago

I’m not clear if your customers process payments through your Stripe account, but if this is the case (it sounds like it) you need to work with a network that serves “high-risk” customers. There are brokers that can place you with the right network if you have a hard time finding one yourself. You will have to get transparency on the industries of your customers, though, and may have to focus on a couple of them, as otherwise, underwriting you gets very complex. With CBD customers, Stripe is not the right solution for you, no matter what, as they don’t serve “high risk” industries with higher rates of chargebacks and other payment default permutations. Stripe’s way of managing that risk is to kick you out when your chargebacks hit a certain threshold (in exchange for your not having to get fully underwritten as you would if you got your own merchant account). Or you cease being “high-risk”, for example by cutting your own high-risk customers. It sounds like this is what you’ve started doing already. In that, you’ll have to replicate some of what a network would have to do during underwriting, ie look at the industry of your customers and hope that the industry risk will adequately reflect their future chargebacks. That way, you can also filter out the geographic compliance issue at least during signup. In addition, I don’t know how challenging it would be for you to add a lookup table to your data model, but if you’ll continue serving CBD customers that may sell in different states, I’d say that’ll come in handy. Still, if a customer of yours switched to selling high risk stuff all of a sudden, then you’d still have to deal with a fair amount of legal trouble. I would make sure that that kind of scenario is addressed in your customer agreements (eg by having customers agree to needing your approval before adding new product lines from a list of high risk products or disallowing these products right away). I don’t know much about the payment network industry or whether the above address some of your (past) issues, but hopefully some of this is somewhat helpful. I hope you can keep your business going. Good luck!