Acquisitions

PayPal Makes Its First Acquisition Post eBay Split

PayPal Makes Its First Acquisition Post eBay Split
Image credit: Entrepreneur
2 min read
This story originally appeared on Fortune Magazine

PayPal has bought mobile commerce startup Modest, marking the digital payment giant’s first acquisition since spinning out of eBay last month.

Modest, which premiered publicly earlier this year, helps merchants create mobile apps for their stores.

“Mobile commerce sucks, and we wanted to change that,” said Modest co-founder Harper Reed in an interview withFortune.

Reed was formerly the chief technology officer for President Obama’s 2012 re-election campaign. Modest’s other co-founder, Dylan Richard, was the lead engineer for the campaign.

Modest will be part of PayPal’s Braintree business, which manages and processes payments for companies like ride sharing giant Uber. Both companies declined to reveal the financial terms of the acquisition.

One of the things that drew PayPal to buy Modest’s business was its bet on buy buttons, which let people buy items directly from apps without having the leave to another web page. Modest lets retailers embed buy buttons within their own apps, and other areas, including emails. Many social networks, including Facebook, Pinterest, and Twitter are embedding buy buttons on their sites that let people to buy items they see on the networks. Braintree recently partnered with Pinterest to help process payments for the site’s buy button.
 
Modest’s technology will also bring additional commerce expertise to PayPal beyond just payments, including shipping and inventory management.
 
This isn’t PayPal’s first acquisition this summer. In July, prior to splitting from eBay, the payments giant bought money transfer company Xoom for $890 million. As outgoing eBay CEO John Donahoe had previously explained, the once-symbiotic relationship between eBay and PayPal was not as tight as it used to be and that they could do better alone while focusing on their respective businesses.

More from Entrepreneur

Are paying too much for business insurance? Do you have critical gaps in your coverage? Trust Entrepreneur to help you find out.
Get Your Quote Now

One-on-one online sessions with our experts can help you start a business, grow your business, build your brand, fundraise and more.
Book Your Session

Whether you are launching or growing a business, we have all the business tools you need to take your business to the next level, in one place.
Enroll Now

Latest on Entrepreneur

My Queue

There are no Videos in your queue.

Click on the Add to next to any video to save to your queue.

There are no Articles in your queue.

Click on the Add to next to any article to save to your queue.

There are no Podcasts in your queue.

Click on the Add to next to any podcast episode to save to your queue.

You're not following any authors.

Click the Follow button on any author page to keep up with the latest content from your favorite authors.

Why Prioritizing Company Culture Is the Key to a Successful Acquisition