PayPal

PayPal was not originally called PayPal. Confinity — founded by Peter Thiel and Max Levchin — built software that could beam money between PDAs. At the same time, Elon Musk founded X.com, an online bank. In March 2000, they merged. The combined company was renamed PayPal in 2001, after a product Musk reportedly disliked. Musk would spend decades later trying to revive the X name for Twitter.

While Elon Musk was on his honeymoon in October 2000, the board voted to remove him as CEO and replace him with Peter Thiel. Among the complaints: Musk wanted to migrate the entire payment platform from Unix to Windows servers — a decision engineers considered technically catastrophic. Musk was furious. The company kept Unix. The episode foreshadowed Musk's combative relationship with boards for the next two decades.

PayPal went public in February 2002. Eight months later, eBay acquired it for $1.5 billion. The group of early PayPal employees — Musk, Thiel, Levchin, Reid Hoffman, David Sacks, Keith Rabois — became known as the "PayPal Mafia." They went on to found or fund LinkedIn, YouTube, Yelp, Palantir, SpaceX, and dozens of other companies. No single company has produced more consequential founders than PayPal.

After years of activist investor pressure, eBay spun off PayPal as an independent publicly traded company in July 2015. PayPal's market cap at separation was $46 billion. eBay's was $33 billion. The subsidiary had become more valuable than the parent — a pattern that would repeat across corporate history.

PayPal reached a peak market cap of over $360 billion in July 2021. Then rising interest rates, intensifying competition from Apple Pay, Stripe, Cash App, and Venmo eroded its edge. The stock fell over 75% from its peak by 2022 — one of the most dramatic collapses of any major U.S. fintech. Under new CEO Alex Chriss, appointed in 2023, PayPal pivoted aggressively toward AI-powered checkout tools and merchant services, attempting to recapture relevance in a payments landscape it once dominated.