PayPal’s user base is growing and so is the number of transactions it handles every day.
Resting squarely at the heart of the company’s growth is the PayPal Platform and Developer Network (PDN), which is critical to the continued success and expansion of PayPal beyond its traditional eBay roots.
The third quarter of 2005 proved to be a big one for the company as it saw accounts jump to 87 million, which is a 53 percent year-over-year increase. Of course, with more accounts comes more transactions.
In Q3 2005, PayPal reached $6.7 billion in payments, a 44 percent increase from the same quarter last year. In other words, consumers worldwide spent $842 per second during the quarter.
Seventy percent of that payment volume comes from eBay, which is where PayPal really got its footing. But according to Tim Villanueva, general manager of the PDN, the company is just getting started in terms of international and global growth.
“Given that we have tremendous self service capabilities with, for example,
e-mail payment or the button factory, we’ve been able to see tremendous
growth outside of that, which is driven by our developers,” Villanueva
said.
“But when you look at the aggressive goals that we have for the
business and the wide growth we want to achieve, it’s critical for us to also
empower our developers and leverage them both as a channel and as a network
to integrate our merchants.”
Developers are PayPal’s VAR (Value Added Reseller) channel. Villanueva
explained that merchants need integration expertise and, as such, there is an
opportunity for integrators to both provision and enable PayPal.
“We are enabling developers and integrators to streamline the integration
process for merchants,” Villanueva said. “So we’re building an army of
developers that both recommend our solutions and integrate our solutions on
behalf of merchants.”
Launched in 2002, the PDN currently has more than 300,000 registered developers. It includes 14 standards-based APIs that cover both informational and transactional Web services. SDKs, toolkits, buttons, wizards and documentation, as well as community forums and discussion are on the PDN all in support of developers.
The PDN also aims to build something akin to an ISV
Though PayPal has been in business since 1998, Villanueva considers it still
to be in an early stage, because it’s just now focusing on the merchant
services business.
PayPal recently announced its intention to acquire VeriSign’s payment gateway business, which VeriSign said processed over $40 billion in payments in 2004.
Villanueva noted that the VeriSign deal had not closed yet, so he could not
comment in any detail on the operational plans for the acquisition.
“I think we’re just barely beginning to really realize what the Internet
and the broad connectivity that the Internet can enable,” Villanueva said.
“When you think about the hundreds of ways that each of us deals with our
money, who we pay and who we give money to and how we manage that, all of
these become interesting applications for PayPal.”
