Silicon Valley’s biggest titans all started at the same place – meet ‘The PayPal Mafia’ still shaping the world today | The Sun
THE STORY of Silicon Valley can't be told without PayPal bridging the gap from the 1990s to the 2000s.
The PayPal saga is one of the most epic tales of a company inventing its own industry, parrying competitors and regulators, coming out on top, and turning dozens of people into technology legends.
The "PayPal Mafia" is an elite group of engineers, investors, and visionaries who continue to shape Silicon Valley and the world today.
The engineers who got their start at PayPal would go on to have illustrious careers as entrepreneurs, and several alumni of the PayPal Mafia are billionaires – all of them are, at least, multi-millionaires.
PayPal was born out of the collision of two online payment companies: X.com and Confinity.
Both offered free cash bonuses to try to steal the other's users and nearly spent each other into oblivion – they would eventually join forces in a bittersweet merger, with X.com and Confinity alum duking each other for executive positions.
The company invented complex security tools, revolutionized digital payments, and survived startup cardiac arrest on multiple occasions. But PayPal was just the beginning for these tech titans.
Elon Musk founded X.com with the windfall from the sale of his first company, Zip2 – he was already rich, but not mega-rich, and he risked a $10million dollar chunk of what he had at the time to launch X.com.
He envisioned X.com as the epicenter of digital finance, cresting the wave of shifts from analog to digital.
Even though he was still the largest shareholder after the X.com-Confinity merger, he was gutted by the 50-50 arrangement of power. He fired the CEO who oversaw the merger and took his place.
PayPal's sale to eBay made Musk immensely rich, giving him the funds to get SpaceX and Tesla moving, but it didn't happen without a Shakespearean betrayal.
There was contention about the direction that Musk was steering the company in. There was lingering pettiness over whether the company should be called X.com or PayPal.
Musk was eventually removed as CEO while on his honeymoon – the other executives conspired behind his back to have him taken out when he couldn't defend himself.
Musk is able to laugh off his ouster from PayPal. "Maybe they thought I would come back and convince the board my original strategy and then just fire them," he told Jimmy Soni, author of a PayPal biography called The Founders.
Today, Musk owns the X.com URL out of sentimental value. He also owns a space travel company, the top electric car brand in the world, and if the ink dries on the paperwork, he'll own Twitter.
While a good deal of Silicon Valley all-stars could be called the "nerd that made it", Peter Thiel has more fury to him.
Recent headlines about Thiel are keyed in on his political bankrolling of pro-Trump candidates JD Vance and Blake Masters. He saw to the destruction of the news outlet Gawker using a Hulk Hogan sex tape as his foil in a showdown worthy of an HBO Miniseries.
But once upon a time, Thiel was an early investor in Confinity, when their flagship product was the ability to beam funds from one Palm Pilot to another.
During PayPal's run, Thiel was almost killed in a car accident when Elon Musk totaled the $1million dollar McLaren sports car they were riding in.
As chairman of the board of directors, Thiel sanctioned the hit on Musk and stepped into the CEO role himself.
Later on, Thiel would become the first outside investor in Facebook. He bought 10% of Facebook for $500,000 and sold it for $1billion.
Reid Hoffman brokered the sale of PayPal to eBay – in doing so, he turned millionaires into billionaires and business knights into industry kings.
According to Soni's book, Hoffman told the eBay executive board, "I have a mandate to sell the company for a billion dollars."
And he got it.
While delivering the commencement speech at Vanderbilt University, Hoffman explained how PayPal's brutal schedule prompted him to plan a year of travel and rest – those plans were aborted when the idea for a professional networking site crystallized in his mind.
Instead of vacationing, Hoffman founded LinkedIn, the networking site that has become the lifeblood of modern employment and connection.
Hoffman's life motto is aptly loaded with business terminology fitting for a Valley-er: “To change the world for the better, at scale.”
The executives at PayPal were ultra-savvy folks whose next move after PayPal would be a guaranteed draw for investors.
But the juniors at the company had big ideas too.
Jeremy Stoppelman was a young but trusted engineer at PayPal who saw the company through to its acquisition. When Musk was ousted as the CEO of PayPal, a 23-year-old Stoppelman let Thiel have it in a shouting fit detailed in Soni's book.
Stoppelman later took in an investment of one million dollars from PayPal co-founder and Chief Technology Officer Max Levchin to start his own business.
He turned Levchin's $1million dollars into Yelp, the local reviews company worth $2billion dollars – adding to his legend status, Stoppelman turned down Google's offer to buy Yelp, which earned him praise from Steve Jobs.
The reach of PayPal alumni somehow goes further than space travel, electric cars, local reviews, and social media networks.
Chad Hurley, Stephen Chen, and Jawed Karim served honorably as young PayPal employees before founding YouTube in 2005.
Karim uploaded the very first YouTube video called "Me at the zoo" – the video has been viewed over 230,000,000 times.
When the company was bought by Google just a year later for $1.65billion, all three received hefty portfolios of Google stock.
Read More On The Sun
TikTok star dies at 19 as family announce teen’s ‘sudden passing’
How to watch Agility Championship Preliminaries ahead of breed competitions
eBay spun PayPal out as its own entity in 2015 and later halted the use of PayPal as a payment option on their site in 2021.
PayPals's role in fintech engineering, fraud prevention, and e-commerce has left its mark on Silicon Valley and the entrepreneurs who were part of PayPal's ascent have tattooed their stamp on the world.
Source: Read Full Article