Old news but new analysis. Check out Karen Webster’s take on the news that stopped the payments world from spinning on its axis for a little while yesterday.
Yep, just another typical Monday in the payments world.
Amazon launched its subscription payments offering designed to compete with PayPal, Max Levchin, one of the original PayPal Founders (and 2013 PYMNTS Hall of Fame inductee) launched an offering to compete with PayPal’s BillmeLater, and PayPal’s President David Marcus resigned to join Facebook where it is reported that he will lead its mobile messaging group and turn it into its latest and greatest hit.
There’s nothing like the CEO of any company leaving to start the rumors flying – and any news pertaining to PayPal generally sends the internet into a ‘tizz. Of course, David Marcus leaving PayPal is old news by now since just about every news organization in the world tweeted, emailed and blasted it out the second they heard about it. So did we.
Most of the coverage though is focused on how Facebook snagged David so that it could expand the social network’s revenue stream beyond ads into payments, using its mobile messaging platform as a baseline. (To be clear, this messaging platform is exclusive of What’sApp, it would seem, since that will remain a separate organization once the acquisition closes.) What people seem to be implying is that the Marcus/Zuckerberg combo platter will deliver a global platform for sending money to each other all over the world, leveraging David’s knowledge and expertise in mobile + payments + global from his 3 years at PayPal.
Doesn’t sound like a bad idea. This is certainly an active area. PayPal is already doing a great job of this on mobile, Alipay is doing it for Chinese around the world, and Tencent is trying to marry payments with its massively successful WeChat social messaging app. But it’s hard to see how David could be of much immediate help. I can’t say for sure, but I would be willing to bet that David has a pretty tight non-compete that would make it very hard for him to take that on for a pretty long while. Don’t forget the ugly lawsuits that followed when Google poached PayPal folks for its Google Wallet initiative. More likely, Facebook is interested in accelerating the development of its mobile messaging app and mobile is and always has been David’s sweet spot.
Frankly, Facebook has bigger fish to fry right now with Messenger than commerce-enabling it. It first needs to get more people using it – and figuring out its overall mobile messaging vision and game plan, specifically how Messenger will coexist/complement with Whats App (which Zuckerberg and Whats App Founder swore up and down would stay separate from Facebook) and Slingshot. At some point, commerce might be viable path to pursue across its messaging applications, and at that point, I imagine that David might know a few peeps at a certain digital payments commerce player whom he could call upon to help him sort that part out.
The other big “story” seems to be the issue of succession and who’ll fill the top spot at PayPal. For the moment, John D will be the Interim President, a role he played when Scott Thompson left in 2012. I’ve mentioned this before in prior writings, but PayPal is unusual in how many seasoned entrepreneurs it has in its organization and who serve on its leadership and executive teams. These folks were all acquired as part of the various acquisitions they’ve done over the years, leaving PayPal with a slew of internal talent from the retail, commerce, technology and payments space to draw from.
So, not only does PayPal have a wide and deep bench to consider internally, but it has folks who will no doubt continue to do their thing at PayPal without skipping a beat. The ability to keep focus in the midst of change is what good entrepreneurs know how to do better than anyone else. So David Marcus is leaving a really solid entrepreneurial team behind.
David said in his LinkedIn post, (worth a read) that more than anything else, he loves creating products. That passion was evident at PayPal – I heard him mention recently that PayPal released 58 new products in 2013 and there’s a robust pipeline in the hopper for 2014. That seemed possible in an organization of 14,000 because David’s entrepreneurial roots instilled not only a “startup” culture at PayPal but implemented an organizational structure that helped create an agile product focus with the customer front and center. But making the move from innovator to the manager of a company with lots of innovators is a hard bridge to cross for many entrepreneurs who truly love the challenge of building someone entirely new with much smaller teams. It’s pretty hard to get your hands dirty as the President of an organization of 14,000 people all over the world.
There are builders and there are operators. Builders like to get their hands dirty and from what David wrote, it seemed like it was time to get back to building. And, while it’s always hard for an organization to absorb the shock of the top guy moving on, it’s probably not the worst of times to have had this happen at PayPal. I imagine that we’ll see John D do what he did when Scott Thompson left – and it wasn’t very long before the job was filled – and I’ll mention, from the rich entrepreneurial pool at PayPal.
We’ll all have to wait to see if that lightning strikes twice.
Of course, you could always chalk up David’s announcement – and everything else that happened yesterday in payments – to cosmic forces at work. In case you’re interested, here’s what yesterday’s cosmic calendar had to say:
“The advent of Scorpio Moon each month can force a large proportion of the human population to deal with their hidden motives, and entrenched behavior patterns. This can often lead to emotional catharses that help to restore inner peace and calm to hundreds of millions of struggling souls on our home planet…You may be able to accomplish some of this as the Sun trines Ceres while the Moon trines the recently reversed Mercury.”
Perhaps the payments universe has spoken!
If nothing else, the news about David leaving for Facebook really shut down any chance Amazon had of getting PR traction with its new payments play. Drowning out Amazon was a very nice parting gift to leave your PayPal colleagues with, David!
We wish David the very best in his new adventure at Facebook. Text us once you get settled in J