PayPal president David Marcus is bolting for Facebook where he will be a VP leading Facebook Messenger, the standalone messaging app with 200 million monthly users and 12 billion messages sent daily.
It’s a bit of a head-scratcher. PayPal is one of the most interesting companies in the technology industry. It’s one of the only online payments companies that has gained any real traction with mainstream users. Mobile payments are set to take off any day now, and PayPal could (should?) be leading the charge.
Marcus joined PayPal as vice president in 2011 after it bought Zong, the mobile payments startup for gaming and social networking companies that he founded in 2008. Before that, he was at Echovox, a mobile monetization startup for media companies.
Considering Marcus’s long history of working with payments and lack of history working with messaging, it looks like Facebook is setting a roadmap for its messaging apps: Monetization through mobile payments.
Right now, neither Messenger nor WhatsApp — the messaging app that Facebook bought in February for $US19 billion — allow users to send or receive money or buy things through messaging, but other hugely popular messaging apps do. (To be clear, Marcus will have no control over WhatsApp.)
LINE, for example, the most popular messaging app in Japan, has a number of different revenue streams through in-app purchases, like games and stickers.
WeChat, a Chinese messaging app, has an even more robust payments strategy. Like LINE, WeChat sells users virtual goods like stickers and games, and the Economist estimates that 85% of its $US1.1 billion in revenue this year from in-app gaming. However, WeChat payments are also accepted all over China: The company allows users to scan QR codes — for example, at vending machines — to pay for goods directly from the app. Users can also send money to their peers with WeChat, and the company even launched a platform where users can invest money through the app.
Payments seem like a logical integration for Facebook. The company could allow users to send money through Facebook messages, similar to how PayPal’s app lets users send money to their friends for free or how Venmo (owned by eBay) lets users easily settle debts.