GigaOM » Braintree

With $35M in new funding, Braintree wants to take payments global

Ryan Kim — Wed, 17 Oct 2012 11:00:13 +0000

While Braintree has gained attention more recently for powering payments for Uber, Airbnb and Fab, it’s been pursuing a larger vision of fueling online and mobile commerce around the world. And now it’s got some serious funding to go after that goal, thanks to a new injection of $35 million in Series B funding led by new investor NEA, along with participation from existing investors Accel Partners, RRE Ventures and Greycroft.

The new investment brings Braintree’s total funding to more than $70 million and helps it expand its staff of 100 employees as it push into more overseas markets. The company in August launched in Canada and Europe and now serves 31 countries, with more markets set to open up later this year. It is processing more than $5 billion in payments a year — $1 billion of that in mobile commerce — for more than 3,000 mobile and online merchants.

The company has billed itself as a one-stop shop for startups and merchants that want one payment platform they can rely on as they grow. And it’s hoping to be a go-to resource for overseas merchants who don’t have many options to enable payments and online commerce. Braintree competes against PayPal and Stripe for developers getting started with payments but it also goes up against Authorize.net, Cybersource and others for larger customers.

Braintree supports 130 currencies and recently added instant approval for merchants. And with Braintree’s acquisition of mobile payment startup Venmo in August, Braintree is stepping into the consumer business.

Bill Ready, Braintree’s CEO said he wants to create the infrastructure for commerce that developers and merchants can build on top of.

“What Braintree has done to enable single-click check-out, international payments and making it available for every startup and developer, we were the first to do it in US and we think the whole world should have access to it,” Ready said.

Image courtesy of Flickr user foforix

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Braintree adds instant approval to its payment platform

Ryan Kim — Mon, 01 Oct 2012 14:00:45 +0000

Braintree, the company powering payments for Uber, Airbnb, LivingSocial and AngryBirds, is now making it a lot faster for developers to sign-up with its service. Braintree is introducing Braintree Instant, which allows developers to start accepting payments within 30 minutes of registration.

Previously, it took only 30 minutes to integrate with Braintree but approval usually took a few days for a merchant account or underwriting approval. Now, Braintree can offer quick access like PayPal and Stripe. This helps Braintree appeal to developers as a complete payment tool that can scale with them as they grow. Braintree Instant is only available now for US-based developers but will be open to international developers in the coming months.

In the past, some developers have started with PayPal or another aggregator and then graduated to Authorize.net and later to Cybersource and Chase Paymentech. But Braintree believes it can be one-stop shop for developers who don’t want to keep switching payment processors. Braintree in August added support for 27 new countries including Canada and most of Europe and accepts payments in 130 currencies.

Braintree is also offering a new flat 2.9 percent fee plus $.30 per transaction and is also cutting the time it takes for merchants to get funds to two days. The company is now doing almost $5 billion in annual processing volume and has more than 2,000 merchants.

Image courtesy of Flickr user foforix

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Braintree expands mobile payment ambitions; acquires Venmo

Ryan Kim — Thu, 16 Aug 2012 19:01:15 +0000

Braintree, the quiet payment processing force behind many of the hottest startups, has been pushing hard on mobile payments, which has been the fastest-growing part of its business. Now, in effort to continue that momentum and take on established players like PayPal, it’s announced it will pay $26.2 million for payment startup Venmo, according to a report in the New York Times.

Venmo, which moved from Philadelphia to New York, first appeared on the scene two years ago with a peer-to-peer payment system that worked via SMS. It finally put the whole package together in March, when it came out of beta and opened to the public, enabling people to send payments through iOS and Android apps and over the web. The company said at the time it was processing $10 million in payments a month and was hoping to to get to $250 million by the end of the year.

Now with Venmo in the fold, Chicago-based Braintree gets another way to build up its mobile payments business and also compete with new rivals like Stripe. The move also gives Braintree a consumer-facing business, instead of the B2B work it was doing supporting more than 2,000 companies.

Braintree is currently doing more than $4 billion annually in processing volume thanks to big-name clients like Rovio, Uber, Fab.com and Airbnb. Most of that businesses was online but Braintree said about $1 billion of that was in mobile, which was growing much faster than its online commerce business.

With more and more commerce moving to mobile, Braintree is in a better position to take its share of that business. It will still continue to push hard on mobile commerce but with Venmo, it also has a way to profit from peer-to-peer payments. That’s a crowded field, though. Companies like PayPal have been enabling P2P payments for years and other big names like American Express and Visa along with smaller startups like Square and Dwolla are also in the same space. I think Venmo may have been able to make a better go of it by itself if it had launched to the public earlier. Now, it faces a lot of competition and it’s probably best that it is being folded into a player like Braintree.

The purchase of Venmo will likely signal more consolidation to come in the mobile payment space. I expect we’ll see not just payment companies come together but startups all across the payment, loyalty, offers and local commerce market get rolled up over time. The deal also highlights the growing opportunities in mobile payments. As more and more people turn to their phone to pay for things, there’s a lot of money to be made.

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Braintree quietly making sure startups get paid

Ryan Kim — Fri, 13 Apr 2012 17:37:15 +0000

Besides being some of the hottest start-ups around, Rovio, Uber, Fab.com, Airbnb share a common thread: their payments are powered by Chicago-based Braintree, a payment provider that has quietly become a force in the online commerce world. The company, which raised $34 million from Accel Partners last year, is now processing $4 billion annually and is on pace to break $1 billion for mobile in the next month.

Braintree’s services still trail PayPal and Visa, but the traction it’s getting from start-ups as well as bigger companies is showing that its developer-focused approach is paying off with customers. Braintree provides a full set of payment services from credit card processing, payment gateway and merchant accounts, to recurring bills and credit card storage.

Founded in 2007, Braintree provides APIs in seven languages and full support for iOS, Android and Windows Phone. It looks to abstract the payment pieces away from the developer workload, so companies can just plug in Braintree and get going quickly. The system pushes much of the back-end work to the cloud and allows developers to focus more on their products. And it stores the customer credit card data, reducing the risk for merchants and making it easier to be PCI compliant. Earlier today, it announced that it was allowing developers to create test transactions to try out the service prior to being approved as a payments operator.

“Our whole focus is we want to make the developer’s lives around payments very easy, whatever the environment,” Bill Ready, Braintree’s CEO told me in an interview.

Ready said Braintree tries to provide a “white-glove” level of service, even pointing out code that needs to be fixed before a customer knows about it. That mix has helped Braintree not just appeal to new startups but bigger names like OpenTable, LivingSocial, 37Signals, GitHub and many others. It has more than 2,000 merchants and is taking on 100 new customers a month, winning 30-50 percent of its business from competitors. Design store Fab.com has been a customer of Braintree and its CEO Jason Goldberg told me he’s quite happy with the choice.

“Braintree is more developer friendly. They put it all out there and then make their team available for calls to help support it. Also, they engaged with us from day 1 of our going live to make sure we could scale our payments with the volume of orders we were seeing. “This is not a trivial thing as the credit card companies only enable small volumes until they trust a merchant,” Goldberg said.

Braintree is also growing by partnering with commerce platforms, including Magento, which announced last month it was making Braintree’s service available to its 110,000 merchants. It’s also signed deals with services like Shopify, Goodsie and others.

While online commerce has largely powered Braintree’s growth up to now, mobile commerce is growing faster. Ready said that ultimately, there will be more payment transactions handled over mobile devices than traditional computers, just as Web traffic increasingly goes mobile. Braintree has tried to make handling mobile payments easier for developers by reducing the number of roundtrips to its back-end servers to just one which helps speed up transactions. And it’s optimized for one-click checkouts by storing cards on file.

Subway, Coldstone and Five Guys are some of the customers turning to Braintree to process mobile payments. And start-up LevelUp, which created its own payment system for its mobile loyalty app, has also leaned on Braintree to get up and running.

Braintree’s rise pits it against established companies like PayPal and start-ups like Stripe, which is also taking a developer-centric approach to payments. Braintree is trying to set itself apart by providing a scalable product that can work for all sizes of businesses. And Ready said the company is quite happy to stay in the background, unlike PayPal which is also a consumer-facing brand. He said Braintree could ultimately grow to be a PayPal-sized business.

“We want to provide solutions that stack up against (Visa’s) Authorize.net, PayPal, Cybersource, any size company,” Ready said. “This is a space that’s amazingly underserved. There hasn’t been a player that’s focused on commerce companies.”

Image courtesy of Flickr user foforix

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