E-Commerce: PayPal's Big Play

An online payment firm rises from the dotcom ashes

When Silicon Valley high-tech financier Peter Thiel and computer wunderkind Max Levchin, 24, launched PayPal in late 1999, they offered up something cyberspace had never seen before: a way of transferring money securely by e-mail. There was only one problem: no one wanted to use it.

Then, in early 2000, eBay customers started showing up. Payments had long been a weak link for eBay. After participating in an auction entirely online, eBay buyers were forced to pay by sending a paper check by snail mail, which added a week or more to the transaction. But with PayPal paypal.com)...

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