Paypal has announced that they have acquired Braintree, a mobile payment startup, for $800 million. It is their first real bit of progress in nailing down the mobile pay market, an area they have so far failed to break into.
With PayPal being one of the most common online financial branches and offered by businesses in many countries, they have been able to secure their slot as top direct-payment service. But having to reenter credit card or account info, and sign in on a separate screen through a smartphone, has made them unpopular with the mobile crowd.
Braintree works by offering an adaptable platform for app developers to include in their programs. Businesses have been turning to the app to create faster, easier ways for customers to buy.
Now that app will be combined with PayPal for a more intuitive payment process that will launch them into the mobile world. A move that has been a long time coming, and I am surprised parent company eBay hasn’t wriggled their way into before now.
On the official Braintree blog today, William Ready spoke about what this decision meant for the app.
First and foremost, Braintree’s vision for the future of payments and commitment to great service has not—and will not—change. From the start, our goal has been to provide developers and entrepreneurs with easy access to the sophisticated payment tools they need to build beautiful, next-generation commerce experiences – whether on mobile, across international borders or in wholly new areas of commerce such as marketplaces and the sharing economy. We’ve also placed the highest value on great service and thoughtful interaction with our customers.
The blog post went on to explain that Braintree will still be a separate service that is merely integrated with PayPal rather than becoming a true part of it. Which is probably a good move, as there are plenty of dissenters to the deal that have had bad experiences with PayPal as a primary service.
PayPal has been experimenting with new tools for awhile, like auto-fill and automatic payments. But none of those things have really come to fruition. Buying Braintree seems to be a fast track to having a ready made mobile app that they already know is popular. The smaller company is processing around $12 billion annually, though only a fraction of that is through mobile (about $4 billion).
As a PayPal user, I am excited about this acquisition and can’t wait to see it put into practice.