Serial fintech entrepreneur Chris Larsen plans to take a breather.
In January, Larsen will hand the reins and the CEO title at Ripple over to Brad Garlinghouse, who is currently the company's president and chief operating officer.
Larsen, 56, will stay on as executive chairman. He still plans to come in to the office every day and help guide the company, based in San Francisco. But he said he wants to spend more time with his family.
"This has now been 20 years, I've got two young boys, I want to make sure I get the right balance on," he said. "One hundred percent of my professional time will be focused on Ripple and helping the team and Brad, making sure we're seeing everything that's going on in this incredible space, and focusing on the right things that are going to have the biggest impact."
In 1996, Larsen co-founded the online mortgage lender E-Loan, which was eventually sold to Banco Popular. He also co-founded and ran the marketplace lending platform Prosper from 2006 to 2012, and later that year co-founded Ripple, a provider of distributed ledger software for fast cross-border payments, and has been its CEO ever since. (Along the way, Larsen co-founded the coalition Californians for Privacy Now, which helped push through a law that restricts banks from selling customers' information to third parties.)
He cited the stress of running a fast-growing fintech startup. "Being CEO of these companies, particularly a global one like Ripple, is a completely all-in endeavor," he said. "I want to get the right balance with my 6-year-old and 9-year-old and make sure I'm part of that every step of the way."
Larsen said Ripple's recent momentum gave him the confidence to dial down a bit. The company has signed 15 of the 50 largest banks as customers, including Standard Chartered, National Australia Bank and Mizuho. Earlier this year it announced a joint venture in Japan with an internet-based financial services company called SBI Holdings. The venture has recruited 42 Japanese banks to a consortium using Ripple technology. In September, Ripple raised $55 million in Series B funding and announced the formation of a steering group of international banks for global payments based on distributed ledger technology. The group includes Bank of America, Santander, UniCredit, Standard Chartered, Westpac Banking Corp. and Royal Bank of Canada. They will set and maintain Ripple payment transaction rules and standards. The company also hired former head of innovation at HSBC and Swift board member Marcus Treacher.
"You can make smooth transitions like this when you're in a strong position," Larsen said.
David Bannister, principal analyst at the research firm Ovum, said that Ripple's recent wins are "a far cry from replacing, or more feasibly becoming a key component of, an infrastructure like the Swift network."
The company "now has to move from being a well-funded startup to being a serious player in the transformation of the world's financial infrastructure, which is going to bring a whole new set of challenges that Larsen might not have been the best person to navigate through," Bannister said. "At the very least, moving to one side reduces the chance of 'founder's disease' preventing the company taking the necessary changes to address new challenges, as has happened with a lot of startups. How Larsen and Garlinghouse work together will be crucial."
He also pointed out that this space is still new and "there's still a lot of jostling for position to get through before the dust settles." Garlinghouse will have to navigate a complex web of alliances, collaborations and competing initiatives with players like the Linux Foundation's Hyperledger Project and Swift.
Garlinghouse has been Ripple's president for 18 months. He was formerly the CEO and chairman of file-sharing site Hightail (originally named YouSendIt). He was also senior vice president at Yahoo!, running its communications business, which included the homepage, Flickr, Yahoo! Mail and Yahoo! Messenger.
While at Yahoo!, Garlinghouse penned the famous Peanut Butter Manifesto, in which he criticized the company for lacking focus and vision.
"I've heard our strategy described as spreading peanut butter across the myriad opportunities that continue to evolve in the online world," he wrote. "The result: a thin layer of investment spread across everything we do and thus we focus on nothing in particular."
"I hate peanut butter. We all should."
Larsen said Garlinghouse has focused Ripple on becoming a global enterprise software firm.
Garlinghouse, for his part, sounded eager to take the new role at Ripple.
"For 20 years Chris truly has been a visionary in this industry, not only with Ripple, but before that with Prosper and before that with E-Loan," he said. "It's been an honor to work with him and I expect he and I will continue to partner really closely."
The company's core mission will stay the same, Garlinghouse said.
"Chris set forth this vision of creating an internet of value, this idea that we need to allow money and value to move the way information moves on the web today," he said. "It's a vision that others in the blockchain industry have adopted, and one I espouse 100% and feel there's a ton of work still to do."
