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TheMobileBuzz
The $800 million Braintree acquisition and
PayPal's pursuit of the
emerging digital marketplace
By Patrick Carroll the customer's mobile purchase journey. The addition of
First Annapolis Consulting Inc. Braintree will add a portfolio of merchants that processes
$12 billion annually while enhancing PayPal's ability to
Editor's note: This article first appeared in the October 2013 issue service an emerging breed of mobile commerce players.
of Navigator. Copyright © 2013 by First Annapolis Consulting
Inc. Reprinted with permission. All rights reserved. The acquisition of Braintree will also support PayPal's effort
to overhaul its developer platform. PayPal's developer
ayPal's pending $800 million acquisition of platform was designed during the e-commerce era of
Braintree illustrates the company's commitment the late 1990s. Braintree's platform has been constructed
to having a market-leading digital commerce with developers and flexibility as a key focus, setting
P solution across a number of merchant segments them apart from most other gateways. The expectation is
and commerce touch points. PayPal's mobile products that the Braintree acquisition will effectively represent an
and services now cater to micro-merchants, Internet start- overhaul of PayPal's developer platform, positioning the
ups, and large retail chains – spanning in-store, online company as a prominent player for emerging e-commerce
and mobile channels. services.
PayPal has been quite active in the payment space with In addition to enhancing its developer platform, Braintree's
many solutions already announced or in-market today, Venmo business is an attractive and intriguing asset.
including: Venmo, a P2P payments service, was acquired by Braintree
in 2012 for $26 million. Venmo has gained traction and has
• A mobile POS solution known as emerged as a new competitor to PayPal's
PayPal Here for small businesses PayPal's developer P2P payments service, particularly
and micro-merchants among younger demographics. In
• A cardless QR-code payment platform was designed recent months, Venmo has expanded
solution known as Payment during the e-commerce its P2P payments functionality to also
Code, catering to the brick- serve as a consumer digital wallet at
and-mortar retail environment era of the late 1990s. participating Braintree merchants.
and made possible through a Braintree's platform has
partnership with Discover In other words, consumers can make
• A proximity-based Bluetooth been constructed with purchases without entering their
checkout solution known as developers and flexibility credit card information by selecting
PayPal Beacon for brick-and- as a key focus, setting a "Pay with Venmo" option. While
mortar establishments Venmo is significantly smaller than
• A widely used mobile them apart from most PayPal, its integration with Braintree
application that supports other gateways. merchants illustrates the reduced
mobile consumer person-to- friction that many mobile-reliant
person (P2P) and small business merchants are seeking in a payment
payments acceptance solution.
In this context, PayPal's pending acquisition of Braintree The Braintree acquisition, the largest by PayPal during the
will broaden its scope of innovative digital commerce mobile era, illustrates the company's intent to expand its
solutions. Braintree is an e-commerce gateway connecting suite of online and mobile payments solutions. As the in-
merchants and marketplaces with their customers. The store mobile wallet race continues to develop in parallel, an
company has emerged as a leading provider of mobile- investment in the app- and mobile web-based commerce
optimized, flexible, and scalable payment services for space should put the company in a competitive position to
mobile-reliant companies such as Uber, Living Social, and grow its total payments volume moving forward.
Airbnb.
For more information, please contact Patrick Carroll, Senior
A typical Braintree merchant interfaces heavily with Analyst specializing in Mobile/ Alternative Payments and
customers via their mobile apps, and puts significant Merchant Acquiring, patrick.carroll@firstannapolis.com.
emphasis on minimizing points of potential friction along
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The $800 million Braintree acquisition and
PayPal's pursuit of the
emerging digital marketplace
By Patrick Carroll the customer's mobile purchase journey. The addition of
First Annapolis Consulting Inc. Braintree will add a portfolio of merchants that processes
$12 billion annually while enhancing PayPal's ability to
Editor's note: This article first appeared in the October 2013 issue service an emerging breed of mobile commerce players.
of Navigator. Copyright © 2013 by First Annapolis Consulting
Inc. Reprinted with permission. All rights reserved. The acquisition of Braintree will also support PayPal's effort
to overhaul its developer platform. PayPal's developer
ayPal's pending $800 million acquisition of platform was designed during the e-commerce era of
Braintree illustrates the company's commitment the late 1990s. Braintree's platform has been constructed
to having a market-leading digital commerce with developers and flexibility as a key focus, setting
P solution across a number of merchant segments them apart from most other gateways. The expectation is
and commerce touch points. PayPal's mobile products that the Braintree acquisition will effectively represent an
and services now cater to micro-merchants, Internet start- overhaul of PayPal's developer platform, positioning the
ups, and large retail chains – spanning in-store, online company as a prominent player for emerging e-commerce
and mobile channels. services.
PayPal has been quite active in the payment space with In addition to enhancing its developer platform, Braintree's
many solutions already announced or in-market today, Venmo business is an attractive and intriguing asset.
including: Venmo, a P2P payments service, was acquired by Braintree
in 2012 for $26 million. Venmo has gained traction and has
• A mobile POS solution known as emerged as a new competitor to PayPal's
PayPal Here for small businesses PayPal's developer P2P payments service, particularly
and micro-merchants among younger demographics. In
• A cardless QR-code payment platform was designed recent months, Venmo has expanded
solution known as Payment during the e-commerce its P2P payments functionality to also
Code, catering to the brick- serve as a consumer digital wallet at
and-mortar retail environment era of the late 1990s. participating Braintree merchants.
and made possible through a Braintree's platform has
partnership with Discover In other words, consumers can make
• A proximity-based Bluetooth been constructed with purchases without entering their
checkout solution known as developers and flexibility credit card information by selecting
PayPal Beacon for brick-and- as a key focus, setting a "Pay with Venmo" option. While
mortar establishments Venmo is significantly smaller than
• A widely used mobile them apart from most PayPal, its integration with Braintree
application that supports other gateways. merchants illustrates the reduced
mobile consumer person-to- friction that many mobile-reliant
person (P2P) and small business merchants are seeking in a payment
payments acceptance solution.
In this context, PayPal's pending acquisition of Braintree The Braintree acquisition, the largest by PayPal during the
will broaden its scope of innovative digital commerce mobile era, illustrates the company's intent to expand its
solutions. Braintree is an e-commerce gateway connecting suite of online and mobile payments solutions. As the in-
merchants and marketplaces with their customers. The store mobile wallet race continues to develop in parallel, an
company has emerged as a leading provider of mobile- investment in the app- and mobile web-based commerce
optimized, flexible, and scalable payment services for space should put the company in a competitive position to
mobile-reliant companies such as Uber, Living Social, and grow its total payments volume moving forward.
Airbnb.
For more information, please contact Patrick Carroll, Senior
A typical Braintree merchant interfaces heavily with Analyst specializing in Mobile/ Alternative Payments and
customers via their mobile apps, and puts significant Merchant Acquiring, patrick.carroll@firstannapolis.com.
emphasis on minimizing points of potential friction along
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