PayPal today announced it is acquiring mobile payment startup Paydiant. Financial details of the deal were not disclosed, though a report from Recode estimated the deal at $280 million, which PayPal declined to confirm.
Founded in 2010, Paydiant helps brands build mobile apps with their own payment system. The startup has provided its services to 9 merchant customers so far: Subway, Orange Leaf, FIS Global, Vantiv, CUWaller, Harris Teeter, Barclaycard, Capital One, and Pulse.
Paydiant doesn’t just help these companies build payments into their mobile apps, it also helps develop offers and loyalty strategies. The startup further provides its mobile wallet platform to MCX, whose members include many of the world’s largest retailers, including Walmart, Target, Sears, Wendy’s, Exxon, and CVS.
PayPal describes Paydiant as “another great company that is focused on reinventing mobile payments.” Anuj Nayar, PayPal’s senior director of global initiatives, explained that his company is getting Paydiant’s expertise in store-branded credit cards, gift cards, and loyalty offers.
In short, PayPal is trying to grow its pitch to merchants. Paydiant’s platform will let PayPal offer merchant partners their own branded wallets that do more than just basic mobile payments. Paydiant’s technology-agnostic approach lets merchants use the mobile payment technology, including QR codes and NFC, that “best suits their business.”
Nayar noted that in addition to Paydiant’s technology, PayPal is also getting a mobile development team. Founders Kevin Laracey and Chris Gardner are joining PayPal as well, though it’s not clear how long they will stick around.
PayPal meanwhile says Paydiant will be able to scale its mobile wallet technology and “offer value added benefits to its merchant customers that only a combined PayPal and Paydiant can provide.” More specifically, PayPal lists the following: world-class risk management, 24/7 customer support, loyalty points and private label card acceptance, an open payments platform that supports all mobile operating systems, and global reach into more than 200 markets and 162 million active digital wallets.
Paydiant’s investors include North Bridge Venture Partners, General Catalyst Partners, and Stage 1 Ventures.