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PayPal Holdings Inc. made its second debut on the NASDAQ this morning following its spinoff from parent company eBay. Trading opened at $41.46, climbing as high as $42.55 before settling back down to the as-of-writing price of $41.03. Its current market value sits just above $50 billion.
PayPal was established in 1998 under the name Confinity, a company that developed security software for early personal digital assistants (PDAs) like the PalmPilot. That business didn’t lead to the success that founders Max Levchin, Peter Thiel, Luke Nosek and Ken Howery were hoping for but it did inspire their creation of an electronic wallet that found a major following among the early eBay community.
Levchin and company eventually shifted gears, devoting all of their time to the electronic wallet. In 2000, the company merged with Elon Musk’s X.com which was renamed to PayPal soon after. The company went public in 2002 using the ticker symbol PYPL, opening at $13 per share.
Considering its tie-ins with eBay, it made a lot of sense when the auction company acquired PayPal later that year for $1.5 billion. PayPal quickly emerged as the premiere online money transfer platform, bolstering its technology through several acquisitions and growing its user base over the next decade.
Recently, however, activist investor Carl Icahn urged eBay to split PayPal into a separately traded company. The auction house initially resisted the pressure, citing that commerce and payments are converging, not diverging. Ultimately, eBay caved which brings us to where we are today.
As per the split, each eBay shareholder received one share of PayPal stock for each eBay share they owned.
Image courtesy PayPal