In the early 90s, sending and receiving money online for payment of goods and services rendered was not easy. Individuals couldn’t imagine how possible it would be to carry out such transactions, even though other financial institutions like banks had ways or carrying out online transactions.
But, today, everybody who does business online knows about and is likely using the largest and most popular online payment gateway, PayPal.
Currently, PayPal operates in more than 200 countries worldwide, with over 200 million active users. Since PayPal was introduced in the 90s, it has recorded over 1.7 billion transactions with over 768 thousand websites worldwide using PayPal.
Now, let’s look into the history of PayPal and learn about its success story.
When was PayPal founded?
PayPal was founded in the 90s but officially launched in October 2000. During its early stage of development, it gained massive success mainly due to its referral system and small charges of $20, $10, and later $5 for sign up.
During this time of its history, PayPal achieved almost 10% in daily growth. Between March 2000 and the summer of the same year, PayPal had gotten over 5 million new clients. Before then, it had only 1 million. The business skyrocketed; PayPal was spreading around the world like wildfire. By 2002, PayPal was already among publicly traded companies. In the same year, PayPal stock grew to 55% on NASDAQ.
For a startup like PayPal, such a feat was considered a phenomenal success. By achieving such gain in a short period, PayPal became the centre of the world’s attention. By July 2002, eBay Inc. bought PayPal for the price of $1.5 billion. Since then, PayPal became eBay’s users’ first choice for money transfers.
The acquisition even helped to spread the word about PayPal faster, and PayPal grew even larger. Following its strategy of world expansion, PayPal entered a new era of success and acquired VeriSign payment solutions. Another acquisition happened in 2013 with Braintree payments gateway for $800 million.
In 2014, an activist and an investor of PayPal, Carl Icahn, carried out a major public campaign demanding that PayPal split from eBay. Carl believed that PayPal would see faster growth and provide more valuable services to the world if it splits from eBay.
After remaining in the shadow of its parent company for over a decade, by July 2014, PayPal became a public company again. And as predicted by Carl, the growth rate didn’t take long to happen.
PayPal’s market value grew to $49 billion during its first official day trading as a public company again. The new market value even exceeded eBay’s market value. Even more, PayPal experienced a revenue increase of 16%, and the value of its transactions also increased by 20%, just like Carl had predicted.
The story doesn’t end there as PayPal continued to see tremendous growth and an increase in its market value every single day. In comparison to the 2.4% growth of eBay shares in the second quarter of 2015, PayPal’s shares grew by 5.4%. Even with that, the company’s growth didn’t stop there.
PayPal went on to acquire other online payment gateways over the years. In 2014, PayPal bought the Venmo payment app. In 2015, they purchased Xoom money transfer technology for $890 million, then Paydiant for $280 million, and finally, Modest. Since then, until now, PayPal has seen a continuous forward and upward trend.
Today, PayPal allows users to withdraw funds in over 55 currencies, hold funds in 25 currencies and receive funds in more than 100 currencies. PayPal is not and doesn’t operate like a bank in the traditional sense of banking but processes a number of online payments any conventional bank can only dream of.
Meanwhile, most internet marketers would agree that PayPal is the world’s most successful, safest, and most secure online payment gateway available today.
The success story of Paypal has always been a great case study for innovation consulting specialists. It provides great insights into organizational innovation and other important aspects. Get in touch with us today and let us make you a success story to!