PayPal Mafia

The "PayPal Mafia" is a group of former PayPal employees and founders who have since founded and developed additional technology companies[1] such as Tesla, Inc., LinkedIn, Palantir Technologies, SpaceX, Square, Slide, Kiva, YouTube, Yelp, and Yammer.[2] Most of the members attended Stanford University or University of Illinois at Urbana–Champaign at some point in their studies.

Members of the PayPal Mafia on Fortune magazine dressed in mafia-like attire. From left to right, top to bottom: Jawed Karim, Jeremy Stoppelman, Andrew McCormack, Premal Shah, Luke Nosek, Ken Howery, David O. Sacks, Peter Thiel, Keith Rabois, Reid Hoffman, Max Levchin, Roelof Botha, Russel Simmons. Elon Musk opted to abstain from the profile on the PayPal Mafia due to his well-documented dislike for the term and its implications.

History

Originally, PayPal was a money-transfer service offered by a company called Confinity which was acquired by X.com in 1999. Later X.com was renamed PayPal and purchased by eBay in 2002.[3][4] The original PayPal employees had difficulty adjusting to eBay's more traditional corporate culture and within four years all but 12 of the first 50 employees had left. They remained connected as social and business acquaintances, and a number of them worked together to form new companies in subsequent years. This group of PayPal alumni became so prolific that the term PayPal Mafia was coined.[3] The term[4][5] gained even wider exposure when a 2007 article in Fortune magazine used the phrase in its headline and featured a photo of former PayPal employees in gangster attire.[4]

Members

Individuals whom the media refers to as members of the PayPal Mafia include:

• Peter Thiel, PayPal founder and former chief executive officer who is sometimes referred to as the "don" of the PayPal Mafia[6]
• Max Levchin, Founder and chief technology officer at PayPal sometimes called the "consigliere" of the PayPal Mafia[4][7]
• Elon Musk, is founder of X.com which acquired the company Confinity. Musk later became a co-founder of Tesla Inc, he then founded SpaceX, Neuralink, OpenAI, The Boring Company, and is the Chairman of SolarCity[3][8][9]
• David O. Sacks, former PayPal COO who later founded Geni.com and Yammer[3]
• Scott Banister, former Ironport CTO and PayPal board member[10]
• Roelof Botha, former PayPal CFO who later became a partner of venture capital firm Sequoia Capital[11]
• Steve Chen, former PayPal engineer who co-founded YouTube.[12]
• David Gausebeck, former PayPal Technical Architect, co-creator of the Gausebeck-Levchin test, co-founder of Matterport Inc., a digital 3-D modeling company. [13]
• Reid Hoffman, former executive vice president who later founded LinkedIn and was an early investor in Facebook, Aviary,[14] Friendster, Six Apart, Zynga, IronPort, Flickr, Digg, Grockit, Ping.fm, Nanosolar, Care.com, Knewton, Kongregate, Last.fm, Ning, and Technorati[3][15][16]
• Ken Howery, former PayPal CFO who became a partner at Founders Fund[17]
• Chad Hurley, former PayPal web designer who co-founded YouTube[8]
• Eric M. Jackson, who wrote the book The PayPal Wars and became chief executive officer of WND Books and co-founded CapLinked.[18]
• Jawed Karim, former PayPal engineer who co-founded YouTube.[11] The first YouTube video, Me at the zoo, uploaded by Karim on April 23, 2005.
• Jared Kopf, former PayPal (executive assistant to Peter Thiel) who co-founded Slide, HomeRun and NextRoll.
• Joe Lonsdale, co-founder of Palantir, Addepar, and OpenGov. Founding partner of investment firms 8VC and Formation 8
• Dave McClure, a former PayPal marketing director, a super angel investor for start up companies[19] and founder of 500 Startups which has hit 500+ investments. [20]
• Andrew McCormack, co-founder of Valar Ventures [21][11]
• Luke Nosek, PayPal co-founder and former vice president of marketing and strategy, became a partner at Founders Fund with Peter Thiel and Ken Howery[22]
• Jason Portnoy, former vice president of financial planning and analysis who later became CFO at Peter Thiel's Clarium Capital, CFO at Palantir Technologies, and founding partner at Subtraction Capital.
• Keith Rabois, a former executive at PayPal who later worked at LinkedIn, Slide, Square, Khosla Ventures, and currently with Peter Thiel at Founders Fund, and personally invested in Tokbox, Xoom, Slide, LinkedIn, Geni, Room 9 Entertainment, YouTube, and Yelp.[11]
• Jack Selby, former vice president of corporate and international development at PayPal who co-founded Clarium Capital with Peter Thiel, later becoming managing director of Grandmaster Capital Management.[23]
• Premal Shah, former product manager at PayPal, became the founding president of Kiva.org.[4]
• Russel Simmons, former PayPal engineer who co-founded Yelp Inc.[11]
• Jeremy Stoppelman, former vice president of technology at PayPal who later co-founded Yelp, Inc.[3][6][24][25][26]
• Yishan Wong, a former engineering manager at PayPal, later worked at Facebook and became the CEO of Reddit.[27][28]

Legacy

The PayPal Mafia is sometimes credited with inspiring the re-emergence of consumer-focused Internet companies after the dot-com bust of 2001.[29] The PayPal Mafia phenomenon has been compared to the founding of Intel in the late 1960s by engineers who had earlier founded Fairchild Semiconductor after leaving Shockley Semiconductor.[3] They are discussed in journalist Sarah Lacy's book Once You're Lucky, Twice You're Good. According to Lacy, the selection process and technical learning at PayPal played a role, but the main factor behind their future success was the confidence they gained there. Their success has been attributed to their youth; the physical, cultural, and economic infrastructure of Silicon Valley; and the diversity of their skill-sets.[3] PayPal's founders encouraged tight social bonds among its employees, and many of them continued to trust and support one another after leaving PayPal.[3] An intensely competitive environment and a shared struggle to keep the company solvent despite many setbacks also contributed to a strong and lasting camaraderie amongst former employees.[3][30]

See also

• Traitorous eight

References

1. Staff Writer. "David Sacks: Biography". Wall Street Journal. Archived from the original on February 22, 2014. Retrieved August 30, 2013.
2. Harris, Duke (October 22, 2009). "PayPal finally poised to enter Web 2.0". San Jose Mercury News.
3. Helft, Miguel (October 17, 2006). "It Pays to Have Pals in Silicon Valley". The New York Times.
4. O'Brien, Jeffrey M. (November 26, 2007). "Meet the PayPal mafia". Fortune. CNN.com. Retrieved December 4, 2009.
5. "Thiel, Levchin and the PayPal Mafia". Fortune. November 15, 2007. Archived from the original on September 3, 2012.
6. Rachel Rosmarin (July 12, 2006). "The PayPal Exodus". Fortune.
7. O'Brien, Jeffrey M. (November 26, 2007). "Meet the PayPal mafia". CNN Money. Archived from the original on August 29, 2013. Retrieved August 13, 2013.
8. "Why Elon Musk isn't in Fortune's PayPal Mafia picture". Valleywag. Archived from the original on January 24, 2009. Retrieved July 16, 2017.
9. Ari Levy (February 21, 2012). "'PayPal Mafia' Gets Richer: Yelp and Facebook's IPOs will give another boost to Silicon Valley's influential PayPal alumni". Bloomberg BusinessWeek.
10. David Gelles (April 2, 2015). "The PayPal Mafia's Golden Touch". New York Times.
11. "The PayPal Mafia: Who are they and where are Silicon Valley's richest group of men now?". The Daily Telegraph. Retrieved September 23, 2014.
12. "Steve Chen Biography". A&E Television Networks. April 2, 2014. Retrieved November 28, 2016.
13. matterport.com
14. J.J. Colao (March 2, 2012). "Aviary is Quietly Cornering a Billion-Dollar Market". Forbes.
15. "Tagged.com". Tagged.com. Retrieved August 31, 2013.
16. Scott Duke Harris (November 2, 2009). "Greylock raises $575M fund, adds LinkedIn's Hoffman as partner". San Jose Mercury News.
17. "Ken Howery « Founders Fund". Foundersfund.com. Archived from the original on August 11, 2015. Retrieved August 31, 2013.
18. "Secure.caplinked.com". Secure.caplinked.com. Archived from the original on July 8, 2011. Retrieved August 31, 2013.
19. "Where Are They Now? The PayPal "Mafia" Is More Powerful Than Ever". BusinessInsider.
20. "Dave McClure Hits 500". BusinessInsider. June 27, 2013.
21. "Andrew McCormack Partner". Valar.com. Archived from the original on September 23, 2014. Retrieved September 19, 2014.
22. "Luke Nosek « Founders Fund". Foundersfund.com. Archived from the original on September 16, 2013. Retrieved August 31, 2013.
23. Brehse, Tami (November 24, 2019). "The 'PayPal Mafia' formed in the early 2000s, and includes everyone from Elon Musk to the Yelp founders. Here's where the original members have ended up". Business Insider. Retrieved August 11, 2020.
24. "More PayPal Mafia Mugshots". ValleyWag. Archived from the original on February 18, 2010.
25. Dan Fost (May 21, 2008). "The Coffee Was Lousy. The Wait Was Long". The New York Times.
26. Sarah Lacy (April 7, 2008). "Something to Yelp About". Bloomberg BusinessWeek.
27. "How did Yishan Wong get recruited to PayPal?". Quora.
28. Granato, Andrew (January 13, 2019). "A look at the PayPal Mafia's continued impact on Silicon Valley". VentureBeat. Retrieved August 11, 2020.
29. Banks, Marcus (May 16, 2008). "Nonfiction review: 'Once You're Lucky'". San Francisco Chronicle.
30. Tweney, Dylan (November 15, 2007). "How PayPal Gave Rise to a Silicon Valley 'Mafia'". Wired.