PayPal is a popular American company that operates a global online payment system that supports online money transfer and serves as an alternative to the traditional paper-based payment systems like cheques, demand drafts, money orders, and others. It also works as a payment processor for auction sites, online vendors, and commercial uses, for which they charge a small fee for processing the online payments.
Inception
Paypal was founded by six people, Max Levchin, Peter Thiel, Luke Nosek, Ken Howery, Yu Pan, and Russel Simmons, in December 1998 as Cofinity. Initially, the company developed security software for handheld devices, but in 1999 it was relaunched as a money transfer service.
In 2000, Confinity merged with Elon Musk’s online banking company X.com. In the same year, it’s CEO Bill Harris left the company as he was unsure about the future of the money transfer business. Later, Musk terminated all the internet banking functions and focused all his energy on money service. Then, Peter Thiel took over as the CEO of X.com, and in 2001, the company was renamed as PayPal.
The company grew exponentially, and in the year 2002, the management decided to take PayPal public. In the same year, the company was acquired by eBay for $1.5 billion, which made PayPal the first choice as a payment method for the users.
In 2005, PayPal acquired VeriSign payment solution to expand its e-commerce business. It also partnered with MasterCard and developed the PayPal Secure Card service. In 2008, it acquired the Israeli start-up company Fraud Sciences for $169 million to enhance it’s fraud management practices. In the same year, they bought an online payments company Bill Me Later, that offered credit to more than 9000 online merchants in the United States.
Evolution
After conquering the online market, PayPal started moving its business offline so that it can get more customers to make payments in stores via PayPal. It partnered with Discover Card to allow users to make PayPal payment at more than seven million stores in their network.
In 2013, it acquired several tech companies like IronPearl that offered engagement softwares, and Braintree to enhance their product development and mobile services. Later, David Marcus succeeded Scott Thompson as president of the company.
In 2014, PayPal separated from eBay into a public traded company, and Dan Schulman was made its CEO. The following year, PayPal spent $25 a share to acquire a US-based company, Xoom Corporation. The move strengthened their international business as they got 1.3 million active customers.
They also launched a peer-to-peer payment platform, “PayPal.Me” that allows customers to send custom links to request money transfer and payments via message, email, or any other platform. It was launched in more than eighteen countries, including the United States, the United Kingdom, Germany, Australia, Canada, Russia, Turkey, France, Italy, Spain, and others.
PayPal acquired the Swedish company iZettle for $2.2 billion and is said to be the company’s largest acquisition. It will help PayPal to enhance their digital marketing strength. In 2019, PayPal partnered with Instagram and added a new feature, “Checkout on Instagram.”
Awards & Achievements
PayPal has won more than twenty awards for excellence from the internet industry and the business community. In 2006, it won the Webby Award for Best Financial Services Site and Webby People’s Voice Award for Best Financial Services Site.
In 2016, PayPal won the best workplace award at CSR Ireland Awards 2016. In 2019, it won the award for Best Company Perks & Benefits and Best CEO. It also won the Silver Award at the 2018 American Business Awards.
In 2014, it was awarded the Zinnov Awards in the category of “High Impact Global Roles.” It also won the FDI (Foreign Direct Investment) Company of the Year award at the 2017 Business and Finance Irish Business Awards.
Net Worth of PayPal in 2024
As of April 2024, PayPal has an estimated net worth of more than $45 billion. In the 2017 fiscal year, it earned $1.795 billion, with annual revenue of $13.094 billion. Their revenue increased by 20.8% as compared to the previous year.
Their market capitalization is valued at over $98.2 billion, and their shares are traded at over $55 per share.
PayPal has more than 300 million active registered accounts in more than 200 markets, and they allow their customers to send and receive funds in a total of twenty-five currencies globally.
PayPal is one of the largest financial companies in the world that has headquarters in more than 200 countries. In 2019, it was ranked 204th in the list of largest United States corporations by revenue by Fortune magazine.