Max Levchin was in love with cryptography
Max Levchin, one of Paypal’s founders, was in love with cryptography. He wanted to start a business that had security in its core operations.
Max met Peter Thiel and pitched the idea
Max met Peter Thiel at Stanford where he was giving a lecture. Max realized Peter Thiel was a part of a hedge fund and so agreed to meet later to discuss Max’s business ideas.
Paypal was started for a different purpose
Initially Paypal was started as a company that builds security software that can be used on hand held devices. Peter Thiel funded the company and became a partner.
Max decided to turn the product into an electronic wallet
Max was trying to find a way to use the Crypto system he created for the handheld devices. Finally he decided to use it for creating an electronic wallet where people can send money to each other securely.
The idea got 4.5 million of funds from different VCs
After the idea was pitched Paypal got 4.5 million dollars worth of funding.
Paypal was mainly for Palm pilot
Paypal was originally designed for hand held devices, specifically the palm pilot device. The owners decided to create a website to allow people to take advantage of the same features using the website. It was however believed by the founders to be a trivial step.
The founders realized that the web users were growing more than the palm users
The founders discovered that more and more people are using Paypal from the web and that the growth in the numbers of people using the demo website is much better than the growth of people using the software on the palm pilot device. (See How 9GAG started?)
In year 2000 the team discontinued the Palm pilot software
In year 2000 the Paypal website had more than 1 million users while the palm pilot had 12,000 users. The Paypal team decided to give up on the palm pilot software and to focus on the fast growing web version.
The company had troubles with fraudulent orders
The company started losing month each month as a result of fraudulent orders. After sometime the team managed to find ways to keep the percentage of frauds under control. It’s believed that many Paypal competitors went out of business because of the massive fraudulent orders they got. (See How Hotmail started?)
Paypal grew fast virally
Paypal grew very fast as a result of word of mouth and viral marketing. Users were allowed to send money to those who don’t have Paypal accounts. The later group had to sign up and create an account to receive the money. This technique helped Paypal become viral.
Paypal was getting around 20,000 new users each company
Paypal grew fast. The company had 1,000 employees and was getting 20,000 new users each day
The company went public and got acquired by Ebay in 2002
Shortly after the company went public it was acquired by Ebay for around 1.5 billion dollars
How Paypal was founded?
How was PayPal created? How Paypal was founded? How was PayPal Developed?