ObservationCompany insightGrowth and business modelsTechnologyFounders and companies
Markets now sort winners from losers faster, and profits concentrate among fewer companies
Patrick Collison, John Collison · Stripe's 2025 annual letter · 2026
The idea
Stripe's 2025 letter is a data-rich view of the internet economy from the processor that sees the payments. Businesses on the platform processed about 1.9 trillion dollars, roughly 1.6 percent of world output. Two observations matter for anyone thinking about growth companies. The 2025 cohort of new businesses grew about half as fast again as the 2024 cohort, with most based outside the United States. And markets are sorting winners from losers faster, with profits concentrating among fewer companies. If both hold, early signals matter more than they used to, and the base rate for a new company reaching scale is changing in both directions at once.
Growth is arriving faster and concentrating harder, so a company's trajectory in its first year tells you more than it used to.
When it works
Venture and growth diligence, cohort analysis, and any question about base rates for new companies.
When it may fail
A payments processor sees the businesses that use it, which is not all businesses, and the letter is written by a company whose growth depends on this story. Treat the direction as evidence and the magnitudes as one source.
How to use it
When comparing a start-up with past cohorts, adjust the benchmark: a company growing at last decade's good rate may be below this year's median. Ask for the cohort comparison the letter itself makes.
Where it came from
Letter Stripe's 2025 annual letter · Patrick Collison and John Collison
What the source says. Businesses on Stripe processed $1.9 trillion in 2025, up 34 percent; the founders describe markets sorting winners from losers faster with profits concentrating among fewer companies, and report the 2025 cohort growing about 50 percent faster than the 2024 cohort, mostly outside the US.
Connected ideas
Supports
Competition and profit rarely occupy the same marketAsk how a business escapes competition before asking how large its market is.
Says something similar
Network effects start in one small market, never across the whole oneJudge a network by whether its first small market is dense and self-sustaining, not by the size of the market it aims at.
Concepts
Put it to work on L3VLUP
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