How Elon Musk changed online banking with X.COM and PayPal

Inventho has discussed a lot about Elon Musk’s journey of becoming “The Real-Life Tony Stark”. This is the fourth chapter on the series discussing his childhood, university lifeand his first startupZip2. So here we go. After Elon Musk sold Zip2 to Compaq for $307 millionElon received $22 million for his stake in the company. In 1999the same yearElon Musk founded X.com with Greg Kouri. X.com was an online banking business and its deposits were insured by FDIC.

Funding of X.COM

Elon Musk invested more than $10 million of his money in business. His brother Kimbal Musk also invested in them as usual like in Elon’s other businesses. Nokia Ventures LPGoldman SachsDeutsche Bank Alex. BrownQualcomm Inc.Lab MorganIdealab Capital Partnersand The French bank funded on X.com lately. It helped them to broaden their borders internationally.

Services and Operations of the X.COM

X.com offered person to personB2Band C2B payments. And they also offered banking accounts online. They gained 4,000 accounts daily even in early 2000. “Our long-term goal is to process one trillion transactions,” Elon Musk once stated about his vision for the company in 2000.

At the early stagebanks and other financial organizations were afraid to work with X.com because they saw the newly formed online banking company as a threat. But eventuallythey were able to partner with prominent financial institutions like Barclays BankBank Oneand Wells Fargo.

At the time X.com had a trusted customer basetremendous cross-selling capabilitiesa solid payment systemand marketing savvy. According to James Van Dyke at Jupiter CommunicationsElon Musk was a brilliant strategic marketer. Elon Musk graduated with an Economics degree from Wharton college besides having a Physics degree. Furthermorehe had an internship in a Canadian bank. Sohe had some banking experience also. Those things helped Elon to succeed in X.com.

Merge with Confinity and became PayPal

X.com merged with Confinity in 2000one of X.com’s biggest rivals. The newly merged company was named X.com and Musk was appointed as CEO. But he only served in the position for a year until he was expelled from the CEO position in 2000 because of his disagreements with other executives. He wanted to change its Unix based infrastructure to Microsoft. Sothe company appointed Pieter Thiel as the new CEO. Besides declined from the CEO positionElon remained as a board member and he was the largest shareholder also.

Before the mergeConfinity had a money transferring servicePayPal. In 2001the company changed its focus to that serviceand X.com was renamed PayPal.

In 2002PayPal was acquired by American E-commerce company eBay for $1.5 billion and Musk gained $165 million from it. With the sale of PayPal to eBaythe domain nameX.com also had been owned by eBay. But in July of 2017Elon purchased back domain name X.com from PayPal for an undisclosed fee. ‘ThanksPayPal for allowing me to buy back X.com! No plans right nowbut it has great sentimental value to me”Elon tweeted about the purchase.

Now when we talk about online money transferswe couldn’t forgo the name PayPal. They ranked 182 on the 2020 Fortune 500 of the largest United States corporations by revenue.

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