It’s 10 years since the concept became concrete. The idea was simple enough – letting customers pay online merchants easily, without revealing personal details, and at the same time letting merchants receive payment quickly.
And so PayPal was born.
Along the way, as well as helping people, it’s made its founders rich, to the tune of the $1.5 billion eBay paid to acquire the service six years ago.
The company was put together by Max Levchin, Peter Thiel and Elon Musk, who, among them, have gone on to help create sites like LinkedIn and YouTube.
Meanwhile, around 12% of all Internet transactions are conducted using PayPal.
The big break came when PayPal was bought by eBay and went global – it’s now used in 190 countries around the world – an idea that boosted both companies.
"The fundamental problem eBay had was that most sellers on the site didn’t have merchant accounts with credit-card companies like Visa or American Express," Scott Thompson, PayPal’s president, told the San Jose Mercury News, "and here was PayPal with technology that worked but no demand for it and not making any money."
And Thompson isn’t too worried about the current economic downturn, either.
"People always have occasions when they have to buy things," he said. "What happens in a down cycle is that they move more cautiously. If they want the best deal, they move to the Internet, they don’t go from mall to mall. What’s predictable is that more and more purchases will happen on the Web."
