It doesn’t matter whether it’s a matter of small or even larger amounts, with PayPal short-term and fast transfers work in no time at all. According to Statista, the online payment service reported 431 million active accounts at the end of the second quarter of 2023. Here is the background of one of the scene’s most popular players.
• From PDAs to smartphones, PayPal’s purpose
• Founding teams and the PayPal mafia
• The top dog in Germany
Tech revolution: beginnings of digital payment service providers
Before the smartphones came, there were the less smart mobile phones and before they came, there were the so-called Personal Digital Assistants (PDA). With these devices, as with smartphones today, you could do a wide variety of things – for example manage the calendar or the address book. In 1998, according to the website gruender.com, Max Levchin, Luke Nosek and now world-renowned investor Peter Thiel founded a company called Confinity. The product called PayPal was a payment system for the PDAs just explained.
Founded at the same time Elon Musk, known today for many companies, also a payment service provider. Since both companies made it their goal to digitize payments, they joined forces. The merger initially ran under the name X.com, but then quickly changed its name to PayPal.
Success story PayPal: Two students as a founding duo
According to the portal gruender.de, PayPal was actually invented by the two Ukrainian computer science students Levchin and Nosek. They met while studying at the University of Illinois. Nevertheless, the first employees on the project, such as Thiel and Musk, also played a role in the construction of the company.
Many of the early PayPal employees went on to found their own internet businesses. The business acumen of some ex-PayPal employees is now often lumped together under the PayPal mafia. Former employees are involved in founding YouTube, Yelp and LinkedIn. Others known for their involvement in Airbnb, Meta, Spotify and many more.
The timing was well chosen, around the turn of the millennium other digital payment service providers emerged. However, no one is as successful as PayPal, which is why the online auction house eBay, as gruender.de describes it, bought the company in 2002.
Survey shows: PayPal dominates the German payment market
According to Statista, PayPal is the most frequently used online payment service in Germany. A survey by Statista Consumer Insights from February 2023 showed that 91 percent of participants had used PayPal in the 12 months prior to the survey. The classic mobile payment services are only used to a limited extent in Germany, explains the report published by Statista on the survey. Only 15 percent of respondents used Apple Pay during the same period. Much more popular, but still 41 percent behind PayPal, the Swedish competitor Klarna. The service used 50 percent of the participants in the 12-month period before.
Editorial office finanzen.net
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