Braintree is now processing $4 billion in mobile payments annually, a whopping one third of the company’s total annual payments processed — $12 billion. If beating other payment platforms like Stripe is a matter of scaling quickly, Braintree’s trying to sprint. Its total mobile payment amount has quadrupled over the last twelve months, after the acquisition of one-touch payment app Venmo.
The Braintree benchmark announcement comes at the heels of a recent TechCrunch story that reported Braintree was shopping itself around for acquisition to Square and PayPal. On a phone call, Braintree CEO Bill Ready categorically denied the rumors. He said that people have shown interest in buying Braintree before, but he’s never put it up for sale. He also said that such Braintree sale rumors have circulated before, but, “the Tech Crunch article was first time someone felt compelled to write about unsubstantiated rumors. I’m not sure what agenda was being served with that article, but someone had an agenda.”
Mobile is the fastest growing part of Braintree’s business, which Ready credits to the fact that the company spotted the mobile payments trend two years ago. That’s early days in the phone e-commerce space. “We provided tools that apps like Uber and Airbnb could use to build defining mobile commerce incarnations,” Ready says.
For the past two years, customers who used mobile apps built with Braintree’s payment tool only had to enter their bank information once into the app, and from then on would enjoy one touch purchasing. The Venmo acquisition last year took Braintree’s offerings one step further, allowing customers to enter their payment information once into the Venmo app, and then it could be used for all the other apps that use Venmo. In other words, even if you download a brand new app you can still enjoy one-touch purchasing right off the bat. But only assuming the app is integrated with Venmo Touch — and that’s a big if.
Braintree rolled out Venmo Touch slowly to make sure everything worked properly and announced today that Living Social has adopted it. There’s a handful of other Venmo Touch adopters – HotelTonight, TaskRabbit, Wrapp, TrunkClub, Belly and Simple. Ready says that many other apps that use Braintree will also be incorporating Venmo Touch in the coming months, but he could not name which ones.
PayPal has pissed off enough companies and consumers with its poor customer service and erroneous fraud detection system that it opened a space in online payments that Braintree and Stripe have been racing to fill. Developers love Stripe because it makes it easier for them to split up payments between different parties (helpful for sharing apps like Lyft where drivers and the startup both get a cut). Braintree is trying to compete and rolled out its Marketplace product that does payment splitting in August.
Braintree has nailed the consumer side of the equation by making it easy to pay for something on your phone without needing to enter credit card information. Simplicity of transaction is key in mobile, and mobile may be the gate keeper for winning in the online payment processing space. If so, competitor Stripe has been criticized for being late to the mobile game.
Bloomberg’s Emily Chang pressed Stripe co-founder John Collison on that issue in June, and he pointed to Stripe’s recent partnership with mobile app developer Parse. The partnership happened in March, giving Braintree a head start.
So, developers fell in love with Stripe, consumers love Venmo (and therefore Braintree), and both Stripe and Braintree have rolled out mobile or developer offerings to strengthen their respective weak areas. They’re not on equal footing yet though — Braintree has expanded farther internationally into 40+ countries, and is available across Europe, Australia, and Canada. Stripe is available in Canada and has just recently ventured into the UK and Ireland, but nowhere else in Europe. It’s in private beta in Australia, Belgium, France, Germany, The Netherlands, and Spain though, so the stakes are heating up.
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