E-commerce giant, eBay announced its Internet and mobile payments arm, PayPal will acquire Braintree for $800 million in cash. This is part of PayPal’s push to dominate the mobile payments market which has seen an influx of competitors from the likes of Visa, MasterCard, Stripe and Dwolla. The increasing ubiquity of smartphones and tablets is helping drive the demand for payments on mobile.
Braintree, a Chicago-based startup that offers merchants in over 40 countries worldwide and processes payments in over 130 currencies, is a company started in 2007 by Bryan Johnson. It has served as a reliable platform for payments for fast growing merchants and companies such as Airbnb, OpenTable and Uber. It was on track to process about $12 billion in sales this year.
PayPal president President, David Marcus penned a blog post saying:
As a separate service offered by PayPal, Braintree will be able to scale its platform at a rate that is just not possible for a startup. PayPal’s already solved many of the regulatory and logistical hurdles that will help to extend Braintree’s reach to more customers in more markets even faster. Our resources will enable them to push the boundaries of innovation with ambition and confidence for consumers, merchants and developers around the world. It’s business as usual for Braintree. Braintree will continue to maintain its best-in-class service for its customers and developers for the foreseeable future.
Some of the VC firms expected to get a huge pay day from their investment in Braintree include legendary VC shops Accel Partners and Greycroft Partners and others like RRE Ventures and New Enterprise Associates who have invested about $69 million.
Courtesy: Business Wire