Recently, Paypal declared its independence from eBay and it is looking like a brilliant move. Who would have thought that Paypal, bought by eBay in 2002 for $1.5 billion, would instantly be valued more than eBay right after declaring it would officially be its own company.
In fact, Paypal isn't just worth more than eBay now, it is worth about 43% more with an overall market value of over $50 billion. Not too bad for a company who just started having its shares traded openly, huh?
The Rise Of Paypal
Paypal is definitely just satisfied with where it's at right now. They have been busy recently acquiring other companies to build up more steam and keep its crown as the king of online payments.
They have gotten more involved in mobile online payments by acquiring Braintree, which is a major player in in-app purchasing. Braintree had also acquired Venmo recently as well, which is a fast-growing peer-to-peer app with increasing leverage in the US.
On top of that, Paypal has also acquired Xoom to help it get its foot in the door for expanding more into worldwide money transfers. Paypal is on the rise and not looking to slow down anytime soon.
Of course it needs to with the rise of competitors like Bitcoin.
The Fall Of Ebay
While Paypal is greatly benefitting from the separation from eBay, eBay isn't looking so good lately. Their stock plummeted from $75 billion to $30 billion.
They aren't growing as fast as competitors like Amazon and their competitors are getting stronger everyday.
With social media superpowers like Facebook and Pinterest working on rolling out their own “buy” buttons and more targeted marketplaces like Etsy and Poshmark stealing some of eBay's sellers, eBay better think of something quick to regain some traction before it becomes a thing of the past.
Although eBay is doing pretty good at converting traditional retailers to online ones, competitors like Amazon seem to be doing it at a faster rate.
It remains to be seen what eBay will do, if anything, to try to steal some of the thunder from its rising competitors.
Conclusion
While Paypal keeps growing and picking up steam as its own company, eBay is left to try and keep up with the ever-expanding marketplace competitors. Which company will be the most valuable 5 years from now? Will either get crushed by the competition? Only time will tell.