Braintree Is On The Block, Had Acquisition Talks With Square And PayPal
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Re: Braintree Is On The Block, Had Acquisition Talks With Square And PayPal
#2Is it good or bad for BrainTree that this news is now public?
Re: Braintree Is On The Block, Had Acquisition Talks With Square And PayPal
#3Is it good or bad for BrainTree that this news is now public?
> More recently, it had been in acquisition talks with Square, which also fell through, possibly because Braintree is asking for too high a valuation.
> According to industry sources, Braintree has been asking for $1 billion, which seems unrealistic.
It would seem that other suitors are trying to pressure Braintree to lower their target
Re: Braintree Is On The Block, Had Acquisition Talks With Square And PayPal
#4Is it good or bad for BrainTree that this news is now public?
> More recently, it had been in acquisition talks with Square, which also fell through, possibly because Braintree is asking for too high a valuation. > According to industry sources, Braintree has been asking for $1 billion, which seems unrealistic. It would seem that other suitors are trying to pressure Braintree to lower their target
Square processes $10b. BrainTree processes $10b.
How is Square valued at $4b and BrainTree can't sell for $1b?
Re: Braintree Is On The Block, Had Acquisition Talks With Square And PayPal
#5Is it good or bad for BrainTree that this news is now public?
Both (leaning more heavily towards bad)
Bad: Paypal as a potential suitor will make some existing and potential customers very nervous and that won't be good for customer acquisition. Other potential suitors may see other heavyweights passing on the deal as a negative.
Good: The attention may increase the pool of suitors.
Re: Braintree Is On The Block, Had Acquisition Talks With Square And PayPal
#6Earlier quoted context omitted.
> More recently, it had been in acquisition talks with Square, which also fell through, possibly because Braintree is asking for too high a valuation. > According to industry sources, Braintree has been asking for $1 billion, which seems unrealistic. It would seem that other suitors are trying to pressure Braintree to lower their target
Square processes $10b. BrainTree processes $10b. How is Square valued at $4b and BrainTree can't sell for $1b?
Growth, and probably Stripe plays no small part.
Re: Braintree Is On The Block, Had Acquisition Talks With Square And PayPal
#7Earlier quoted context omitted.
> More recently, it had been in acquisition talks with Square, which also fell through, possibly because Braintree is asking for too high a valuation. > According to industry sources, Braintree has been asking for $1 billion, which seems unrealistic. It would seem that other suitors are trying to pressure Braintree to lower their target
Square processes $10b. BrainTree processes $10b. How is Square valued at $4b and BrainTree can't sell for $1b?
That's not how valuations work. There are a lot more factors than current revenue. Their business models are somewhat different.
Re: Braintree Is On The Block, Had Acquisition Talks With Square And PayPal
#8Earlier quoted context omitted.
> More recently, it had been in acquisition talks with Square, which also fell through, possibly because Braintree is asking for too high a valuation. > According to industry sources, Braintree has been asking for $1 billion, which seems unrealistic. It would seem that other suitors are trying to pressure Braintree to lower their target
Square processes $10b. BrainTree processes $10b. How is Square valued at $4b and BrainTree can't sell for $1b?
Maybe it's because Square has a higher percentage of small merchants on their service, who can't negotiate better rates?
Re: Braintree Is On The Block, Had Acquisition Talks With Square And PayPal
#9The CEO who got ousted, in 2011:
“Without outside capital, we have to make do with less ... Constraints are a beautiful thing because they force creativity and precision. We don’t have the resources to throw after hit-or-miss hires or strategies. Bootstrapping a business requires a different mentality. It’s taught us to be frugal, hire slowly, and exercise caution as we grew the business. While companies that take funding can do those things, people have a tendency to behave differently when it’s not their money on the line.”
This was about 1 year before they raised a massive round from NEA/Accel. From "Bootstrapped, profitable, and proud" on 37signals blog: http://37signals.com/svn/posts/2800-bootstrapped-profitable-...
Re: Braintree Is On The Block, Had Acquisition Talks With Square And PayPal
#10Is it good or bad for BrainTree that this news is now public?
Both (leaning more heavily towards bad) Bad: Paypal as a potential suitor will make some existing and potential customers very nervous and that won't be good for customer acquisition. Other potential suitors may see other heavyweights passing on the deal as a negative. Good: The attention may increase the pool of suitors.
Exactly. We process over $1M a year with Braintree (that's why I posted this article). In my opinion, PayPal is the worst possible scenario short of Braintree shutting down.
The thought of forcing thousands of customers to re-enter billing information makes me throw up in my mouth a little.