Payment services market is very tough - lots of players, lots of new technologies and new companies and so on. Moreover, Apple is working on the Apple Pay, Facebook added the peer-to-peer money transfers into its messenger and I think more to come. According to Forrester, mobile-payments industry is going to reach $142B compared to current $50B. But they also told that 2015 year will be the year of Apple Pay. If you ask me - I used PayPal more often than Apple Pay. I think it means that people get used to this brand and trust it. However, I assume that PayPal needs to make some steps to compete with Apple. In order to get a better understanding of PayPal's market share I used datanyze.com. They calculate PayPal's market share by taking the number of websites using a technology and dividing it by the total websites using any technology in the same category. So according to their calculations, PayPal's share among the Alex top 1M websites is 66%, while the closest competitor has slightly less than 7%. This is just one of the methods to calculate the PayPal's market share. I think that the main source of growth for such companies as PayPal is acquisitions. New technologies come up to the market really fast so every technology giant should monitor the market 24/7. PayPal made several acquisitions this year and I want to review all of them right now. 1. Paydiant I want to review the acquisitions in chronological order, so the first one is Paydiant. PayPal paid $230M to a number of venture funds in March 2015. The company provides a cloud-based white label mobile wallet platform that comprises mobile payments, loyalty, offers, ATM cash access, and related commerce services. Paydiant was founded in 2010. This is the first step in competition with Apple. Just look how smart this step was. PayPal has more than 162M accounts and it was obvious that the company needs to work better with online and offline customers. Due to this acquisition the company got an opportunity to run the loyalty programs, can give the merchants a huge opportunity to grow their customer base and so on. The only positive thing I know about Paydiant is their customer base which includes such companies as Subway, Harris Teeter etc. Probably, we can get more numbers and more detailed info from PayPal's 10-K report. 2. CyActive More companies are worried about the data breach and the security of its platforms. When Square made the IPO, people were always talking about the data breach as one of the potential risks. Payment industry depends on its data very much, as soon as the company is caught in this - it's very difficult to get the customers back. So PayPal wants to improve its cyber security systems and that's why they paid $43M of cash to acquire the Israel-based company Cy-Active. Nothing special about this acquisition, here PayPal got the technology, not the business. I just think that it can be efficient and improve the quality of cyber security. 3. XooM The biggest acquisition in 2015 for PayPal. The total deal size was more than $1B. XooM provides digital consumer-to-consumer online money transfers services worldwide. The company offers money transfer services over the Internet or through a mobile device (website or own app). Some facts about XooM: Gross sending volume is increasing - $5.3B (9 months of 2015) vs $5.1B (9 months of 2014). As you can see, it much higher than Venmo has - Apple's direct competitor;Revenue is growing as well, however, the effective rate is going down. Revenue grew up from $115M (9 months of 2014) to $133M (9 months of 2015). An effective rate (relation between revenue and gross sending volume) decreased from 9.43% to 9.04%. I don't think that this is a significant decline, this is mostly the reason of gross sending volume growth;GSV per active customer decreased from $4,175 to $3,616 for 9 months ended in September 2014 and 2015 - that's not a good sign, however, this figure is still very high;Marketing expenses grew up from 20.25% of revenue as of September 2014 to 22.85% as of September 2015;Technology costs grew up as well from 23.15% as of September 2014 to 26.26% as of September 2015. I wrote the separate post about this company and this acquisition a while ago, you find it here. In order to summarize, PayPal's management is very careful in its acquisitions, all three acquisitions seem to add the real value to the business and make it more competitive.