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PayPal Acquires Braintree for $800M

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Re: PayPal Acquires Braintree for $800M

#181

Post by Flenser »

droopyEyelids wrote: post #106
jfoster wrote: post #47

Earlier quoted context omitted.

Why do you think PayPal bought them? It probably wasn't solely for the userbase, right?

My take: 1) Braintree is a dog fart compared to paypal. They certainly weren't bought for the user base. (although, their size probably probably affected the choice between stripe and bt) 2) David Marcus was acquihired from a team of 5 (a 'real startup') and has been working to startupify paypal. [1] Perhaps he thinks Braintree could be an example to the rest of the company. 3) Venmo is the most successful peer to pe…

Venmo is also used by Simple[1] [2] so it's already in banking. That may have influenced things. If Simple get big then Paypal could end up processing a significant amount of banking transactions.

[1] https://simple.com/ [2] http://pandodaily.com/2013/09/20/mobile-payments-are-one-thi...

Re: PayPal Acquires Braintree for $800M

#182

Post by Silhouette »

rehabindian wrote: post #180
RSASecure wrote: post #154

Earlier quoted context omitted.

PayPal has been trying hard to change this image. David Marcus, who took the helm, has been shifting focus on customer satisfaction. Here is an interesting article on David Marcus: http://pandodaily.com/2013/08/12/if-its-not-broke-break-it-h...

I can tell you from personal experience and experience of 25-30 others here.. Its a smoke screen. The last few people who tried to do what David says to media have either been canned or now serving in timeout zone. Again the President means well but culture internally is much worse. Its a company filled with people whose skills are way past their prime trying to hold on to what little mileage left. David wants things…

I've seen similar anecdotes before, but what I don't understand is why obstructive middle management haven't been shown the door. If it really is a mid-level problem how can the politicians manage to hold off executive management? And if they really are the problem, and both the front-line guys and executive level are willing to change, what reason is there to keep the naysayers around instead of firing and then promoting from within?

Re: PayPal Acquires Braintree for $800M

#183

Post by [deleted] »

rehabindian wrote: post #180
RSASecure wrote: post #154

Earlier quoted context omitted.

PayPal has been trying hard to change this image. David Marcus, who took the helm, has been shifting focus on customer satisfaction. Here is an interesting article on David Marcus: http://pandodaily.com/2013/08/12/if-its-not-broke-break-it-h...

I can tell you from personal experience and experience of 25-30 others here.. Its a smoke screen. The last few people who tried to do what David says to media have either been canned or now serving in timeout zone. Again the President means well but culture internally is much worse. Its a company filled with people whose skills are way past their prime trying to hold on to what little mileage left. David wants things…

[deleted]

Re: PayPal Acquires Braintree for $800M

#184

Post by ExpiredLink »

programminggeek wrote: post #86
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…

They took on a lot of VC and there is no way that an IPO would have valued Braintree at the level that PayPal did. With the amount of investment they took on, they needed an acquisition of at least 500-750 million to get the 10x return their investors expected. In short, when you take on enough investment, your options are IPO or acquisition, whatever makes your big investors the happiest.

> They took on a lot of VC and there is no way that an IPO would have valued Braintree at the level that PayPal did.

So actually the VCs aimed the company to be bought by PayPal ... and succeeded. Seems that most people misunderstood Braintree's business model.

Re: PayPal Acquires Braintree for $800M

#185

Post by pbreit »

WildUtah wrote: post #128
pbreit wrote: post #125

Earlier quoted context omitted.

If you want customers to be able to pay with a credit card, it will be difficult to get individual charge fees under $0.30. If you expect repeat purchasing, best to aggregate charges either ahead of time (aka "pre-pay") or post.

How does iTunes do it? They're doing $0.99 payments all the time.

Apple aggregates to a great extent but I think could go much further. It only bundles up purchases over several days or perhaps a week. Since it's minimum fee is $0.30 (30% of $0.99) it just about breaks even on single song purchases.

But Apple would be fine with the whole App/iTunes Store being a break-even proposition since it has consistently stated that its interest is in the hardware sales.

Re: PayPal Acquires Braintree for $800M

#186

Post by nirmel »

bonemachine wrote: post #127

I'd be curious as to what this would likely mean for an employee of Braintree (or Venmo) holding, say, a 0.25 to 1.5 precent equity slice (or option). Note that I'm not asking anyone from either of those companies to leak, here. Just that I'd be curious what the payout (if any) would likely be in this scenario, drawing on past models.

Are you incapable of multiplying by a decimal? I wonder how much somehow who owns 1% of $100 has. Any rough ideas?

Re: PayPal Acquires Braintree for $800M

#187

Post by bonemachine »

nirmel wrote: post #186
bonemachine wrote: post #127

I'd be curious as to what this would likely mean for an employee of Braintree (or Venmo) holding, say, a 0.25 to 1.5 precent equity slice (or option). Note that I'm not asking anyone from either of those companies to leak, here. Just that I'd be curious what the payout (if any) would likely be in this scenario, drawing on past models.

Are you incapable of multiplying by a decimal? I wonder how much somehow who owns 1% of $100 has. Any rough ideas?

Equity splits are a bit more complicated than that, actually.

Especially when company B buys company A, and in turn is bought by company C.

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