Braintree Acquisition Will Push PayPal's Mobile Transactions Volume Up 170% In 2013

eBay-owned PayPal yesterday announced an agreement to acquire payments company Braintree for $US800 million.

The acquisition would add significantly to PayPal’s mobile-driven transaction volume. PayPal claims it will handle about $US20 billion in mobile transactions during 2013.

Braintree is set to do about $US12 billion in total transactions for the year, with about $US4 billion of that coming from mobile devices.

  • Adding the two together, that equates to a 170% year-over-year lift in mobile transaction volume for PayPal.
  • With Braintree, we expect PayPal to handle around $US193 billion in digital and mobile transactions through year-end, which would be a 33% increase over 2012 (without Braintree, PayPal would only be up 25%).

Aside from the added transaction volume, PayPal is after Braintree’s network of clients and its mobile payments software.

Braintree is a transactions platform that has also quickly adopted the mobile side of commerce and payments. The Chicago-based company powers transactions for well-regarded e-commerce sites and apps like Airbnb, Uber, Fab, and Rovio. These sites offer in-app purchases and are growing quickly in mobile sales volume and revenue.

Braintree leans heavily on subsidiary Venmo for its Venmo Touch software, which stores users’ payment information across a network of Braintree clients and creates a one-touch transaction. Braintree acquired Venmo last year. Venmo also operates a social payments app that allows for quick money transfers between friends.

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