Last August, Silicon Alley darling Venmo, a mobile app that lets you split bills and pay friends, was acquired by Braintree, a PayPal competitor, for $26.2 million. At the time, Braintree emphasized the shift towards mobile commerce. And it looks like having a consumer-facing brand like Venmo is helping in that department.
Today, they announced the launch of Venmo Touch, which should help lower the barrier to buying things on mobile by avoiding the hassle of having to enter your credit card information with every new app . . . as long as it’s part of the Braintree family.
Brain Boost This morning, Braintree, a Chicago-based online payments company announced, a $35 million series B round of funding. The round was led by New Enterprise Associates (NEA). By investing in Braintree, new investors join Accel Partners and others and the company’s total funding is now set at $70 million.
Braintree acquired the beloved bill splitting app, Venmo, back in August and has kept it independent so far. Braintree allows businesses to accept payments from costumers, but Venmo allows consumers to make payments to anyone. It’s a natural fit for both parties.
Braintree’s client list includes fast-growing startups like Uber, Fab.com, Airbnb, who use it, “through periods of rapid growth without disruption to their ability to accept payments,” the company said in an email to Betabeat. They also name-checked competitors like Stripe and PayPal, noting that one “big difference is that merchants receive their funds typically in two days with Braintree, vs. seven days with Stripe.”
A source familiar the deal told Betabeat yesterday that Venmo, a New York City-based mobile app that lets you split bills with friends, is in the process of being acquired by Braintree, a Chicago-based online payments company and PayPal competitor. The New York Times broke the news this afternoon, reporting a $26.2 million acquisition price. On the company blog, Venmo said the deal closed in mid-June and that its payment-sharing service “will remain unaffected” and continue to operate as a wholly-owned subsidiary.
Venmo and Braintree share an investor, Palo Alto powerhouse Accel Partners, which also invested in Facebook.
The two startups do seem to be in the midst of a mutual appreciation society. Last week, Braintree’s community manager Kristi Lynch tweeted, “I know it sounds weird, but the @Venmo app makes me wish I owed more people money.” Two Venmo employees favorited the tweet.
Venmo was founded in Philadelphia in 2009 by two former college roommates, Andrew Kortina and Iqram Magdon-Ismai. The duo eventually moved the company to New York City, where Venmo become one of the early stars in the city’s growing tech orbit, embraced by early adopters for making it easier to split the cost of dinner, drinks, monthly cable bills–or any of the innumerable costs of urban life–over their phones. There were even cutesy, customizable receipts, eagerly tweeted out by the Alley in-crowd.