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PayPal Acquires Braintree for $800M

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Re: PayPal Acquires Braintree for $800M

#71

Post by polarix »

AhtiK wrote: post #58
tednaleid wrote: post #44

Earlier quoted context omitted.

If only PayPal had joined Braintree's "Credit Card Data Portability" initiative [1]. I'm betting that's dead now with them joining PayPal, if it's even still active. If it is, get your data out quick before PayPal can lock it in! [1]: https://www.braintreepayments.com/blog/open-letter-to-the-ce...

I'm somewhat annoyed that they do not publish the list of providers who have joined this initiative [1]. [1] http://www.portabilitystandard.org/ (FAQ Q #1)

http://goo.gl/b4onl0 -- google image search for it

Looks like (unconfirmed list): fusebill, atpay, braintree, recurly, chargebee, app55, uberglobal

Re: PayPal Acquires Braintree for $800M

#72

Post by jeffasinger »

ashray wrote: post #27
dangrossman wrote: post #18

Earlier quoted context omitted.

If you do at least $3-5k/month in transactions, a real merchant account from a bank/ISO/MSP. I pay $0.05 + 0.04% markup over interchange. Even after the monthly and gateway (Authorize.net) fees, that's around 2%, compared to Stripe's 2.9% or PayPal's 2.2% (I qualify for their merchant rate discount). Amex cards are the only ones I pay more for by not doing a flat rate. [By coding against Spreedly, it's possible to do…

I'm more interested in micropayments but this interchange stuff seems a bit complicated. How would a $2 payment work out with interchange included ? I mean, what fees would apply for a $2 credit card payment ?

So you'd have to pay interchange, plus whatever your processor charges on top of that, which will depend on them, and volume. You can definitely shop around a little bit, there's probably several local people who can talk you through it and bring you some offers to the table from various processors, but also get a quote from people like TSYS, First Data, and Chase Paymentech directly.

I'm remembering fees varying from $.05 to $0.10 and 0.10% to 0.15% on top of interchange. The visa interchange rates are available at (1) to give you an idea. You're mostly interested in the eCommerce categories probably, so you'll be paying 1.80 to 1.95% plus $0.10 on top of whatever you're paying from you're processor for credit cards, debit cards are cheaper.

Many people that do micropayments will try to combine some transactions together, in order to save money. That said, you might be interested in paypal micropayments (2), as they only charge $0.05 + 5%, which for a $2 transaction, is a big savings.

1: http://usa.visa.com/download/merchants/visa-usa-interchange-...

2: https://www.paypalobjects.com/IntegrationCenter/ic_micropaym...

Re: PayPal Acquires Braintree for $800M

#73

Post by manishsharan »

What is the rational behind this move?

From my perspective, Braintree had a good brand ( compared to paypal), locked-in customer base and sizeable cashflow (my conjecture based on their fees). Incumbents and first movers in this industry have a huge advantage over newcomers - so they were not as much at risk from newer start-ups. They were also risk averse in how they accepted new customers .

Could they not have restructured, focused on serving their existing customers rather than chasing growth, maybe downsized a bit, and gone for the long run viability with an IPO in about 5 years?

Re: PayPal Acquires Braintree for $800M

#74

Post by dangrossman »

manishsharan wrote: post #73

What is the rational behind this move? From my perspective, Braintree had a good brand ( compared to paypal), locked-in customer base and sizeable cashflow (my conjecture based on their fees). Incumbents and first movers in this industry have a huge advantage over newcomers - so they were not as much at risk from newer start-ups. They were also risk averse in how they accepted new customers . Could they not have rest…

Braintree's 2011 revenue (from their Inc 5000 listing) was $9.9M. A $800M buyout is the equivalent of 80 years of future revenue. That's a lot of cash to turn down.

Re: PayPal Acquires Braintree for $800M

#77

Post by yogo »

nhangen wrote: post #60

It's disappointing, because among that market segment, Braintree is the only one that offers phone support, and for that, I fancy them over Stripe, Balanced, and others. That said, maybe now with Paypal support, they will reverse their stance on crowdfunding. If not, I'm desperate for a professional payment processor that doesn't ask me to send an email if I have an issue.

Actually that's one of the things that annoyed me. For quite a while when you try to login at braintreegateway and you clicked Forgot Password it asked you to call them. There are somethings phone calls are good for and I don't think resetting a password is one of them. Maybe they had a good reason for that.

And why the hell doesn't "braintreegateway.com" redirect to the right place?

Re: PayPal Acquires Braintree for $800M

#80

Post by ashray »

jeffasinger wrote: post #72
ashray wrote: post #27

Earlier quoted context omitted.

I'm more interested in micropayments but this interchange stuff seems a bit complicated. How would a $2 payment work out with interchange included ? I mean, what fees would apply for a $2 credit card payment ?

So you'd have to pay interchange, plus whatever your processor charges on top of that, which will depend on them, and volume. You can definitely shop around a little bit, there's probably several local people who can talk you through it and bring you some offers to the table from various processors, but also get a quote from people like TSYS, First Data, and Chase Paymentech directly. I'm remembering fees varying fro…

Thanks for the detailed information. That certainly clears things up a bit.

I've been using Paypal micropayments for the past year or so and it's been the best bet for $2 transactions (I pay 6%+$0.05 for cross border payments). Ends up being $0.17 per transaction. I haven't come across anything that beats that by a large enough margin so as to replace Paypal yet.

The only downside is that Paypal is applying the standard 6% fee to $20 transactions as well (as opposed to the lower 2.9% fee), so I either need to route these transactions to a non-micropayments Paypal account or do something else with them... this is what I am currently working on solving. The difference doesn't come out to be much for a $20 transaction but with higher transaction volume it will certainly stick out as a sore point.

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