WePay Drops 600lbs of ice in front of PayPal Conference
techcrunch.com
techcrunch.com
...and resolved by acquisitions?
Paypal is owned by eBay if I recall correctly,
and one of WePay's investors is Max Levchin, former CTO of PayPal
edit: Really, people? You modded me up to 17 for making a nitpick about simian taxonomy?
If it makes you feel better, I gave you a point just for that comment...
Long comments have essentially no chance of being voted up significantly. Other things that have very little chance: speculations about the implications of something, wild and surprising analogies, speculation on others' motives, advocacy of norms. This is really unfortunate, because those are the comments I most value reading. I really get no value, beyond a little humor, from reading that gorillas aren't monkeys, since I already know that.
They must have planned this for some time given the logistics involved and the time it takes to freeze quantity of water that size and get a nice and clear chunk.
My own paypal saga isn't over yet, though there have been some surprising developments.
I sincerely hope that someone will one of these days replace paypal with a better way of doing peer-to-peer payments, but online fraud being what it is the question is if it actually can be done without in the long run incurring the same kind of penalties that paypal use has now.
After all, when you're just starting out with a payment service most or even all of your transactions are legitimate. But once the service gets more popular there will be an inevitable influx of scammers, whitewashers, identity thieves,phishers and other less desirable elements. To get rid of the one without hurting the other is a very difficult problem.
International wire transfers are a lot harder to do without actually visiting a branch of the bank I'm with and filling out a bunch of forms, and they take much longer to process too.
That's my personal problem too. Sending money from US to Canada or Canada to the US is a pain. If only they had the same check clearance system, it would solve so much. Same as how having similar phone numbers makes it so much easier.
When I needed to get paid by a Dutch company, the easiest solution turned out to be for me to open a new bank account.
I pictured jacquesm needing to use a custom silver DeLorean to drive there and back. Flux capacitor and all.
If it's local I have much faster and more reliable ways than any web server, bank-to-bank transfers here are online and nearly instant.
Ok, so that rules out wepay then.
HN itself doesn't provide search.
[1] Former PayPal marketing executive
More recently, I had two payment disputes by scumbags. In both instances, I called up paypal and less than 2 minutes of conversation later, I had my money back in my account. Blew me away. I honestly had written those disputes off going by what I'd heard.
I remain in two minds about attacking paypal for account blocks. Almost every company that dares go after this space will have to do their fair share of blocks or risk losing money to fraud. Obviously when you do blocks, innocent bystanders may get caught. I don't think that is a paypal problem as much as it is an industry reality. PayPal's just at a scale where you hear a lot more stories.
Until there is a competitor with some sort of scale that does not need to do account blocks, I'm not sold on attacking PP.
However, when you deal with your bank, you usually have a business banker with a name, a phone number and an office. You are never in a hopeless support ticket black hole. That makes a big difference.
Also, I've heard examples where this is not the case. Eg Couldn't get Paypal to pick up the phone even though paypal was holding $100ks of their money. (http://mixergy.com/dodocase-patrick-buckley-interview/)
With PayPal you can be operating in an hour. They're also cheaper than all banks, unless you have some serious transaction volume. You can hook it into a simple website and start processing payments without even a https cert.
Of course, any serious site will want their own merchant account, credit card processing and the rest. But before you get to that point PayPal is a very handy shortcut that has enabled millions of small sites and sellers.
When PayPal starts charging and acting like a bank, then you can compare the service levels. I personally think, that for the transaction scale and amount of fraud they have to deal with, PayPal does a relatively good job. They aren't saints, but for the vast majority, PayPal transactions work as designed.
In other words : you get what you pay for.
It's not that hard to get an account, especially if you already exist as a customer, even a private one. The costs tend to even out over a certain volume but again, they aren't that high. I'm not sure how easy it would be if you weren't a company, didn't have an address and weren't a customer.
In Australia the most common setup is site + payment gateway (bank or 3rd party) + merchant account. If you are using some existing ecommerce software (hosted, bought or OS) it usually integrates pretty easily with large payment gateways. It all costs about 2-$400 per year plus processing fees, not much different to in store CC processing. I think it ends up at parity with paypal at around 50-$150k depending of total transaction volume (depending on transaction sizes), so you are right that it doesn't scale to micro business levels very easily.
But banks, difficult and bureaucratic as they are do compete for business clients and they do it mostly on the back of customer service.
With paypal you don't get what you pay for. If you transact $7.22 per year you get the same service as $722k.
That's a good point actually. Maybe the anti-PayPal meme might die a little if you could actually get preferred service (and not frozen accounts) if you have a history of processing payments over a certain level. They already know who that is because they give you better pricing for volume.
Banks' solution to this sort of thing is low tech. Have a local banker talk to you, maybe pay a visit.
They need to change their product and/or marketing direction if they want to compete with Paypal... Paypal are not a place to pay your room mates.
They should have somewhere I can compare them and Paypal like for like, feature to feature.
edit: oh and it gets worse, they ONLY allow US payments. Seriously who thought they're anything like Paypal or are suitable as a replacement? https://www.wepay.com/about/faq#thirteen
They are actually doing a big marketing push in that direction right now. "paid out of pocket for tickets?" the paypal screen said earlier today, "Collect via paypal"
hell, I've paid employees, and yes, even roommates via paypal in the past. So yeah, while paypal seems to have a superset of the features and capabilities of WePay, there is a lot of overlap.
These guys found a clever way of hacking the PR loop, while slamming their major competitor, and did a damn well good job of it.
Rather than being douchebags and saying "what was the purpose? They aren't direct competitors." We - the collective we, being the community of hackers - should relish at the thought that one of our kind has sent a direct message to Paypal that we are tired of their bullshit.
Plus they got a ton of free press over it. Stop whining because they came up with a brilliant stunt and you didn't.
If you play nice, when you launch your company/product and come up with a similarly ingenious PR ploy we will upvote your submission too.
Until then, give props where props are due.
Kudos Bill & the WePay team.
Edit: I am not a member of the YC network or anything like that, so don't even reply with any smart comments of that nature. Just sick and tired of the constant bitching from people who would benefit from the experiments done here, but chose to whine about them instead.
"Who owns the money in a Group Account? Groups make it easy to track finances and share information, but the Group Administrator owns the money in the Group Account and is the sole cardholder on the WePay Prepaid Visa® Card."
From the group perspective, it shouldn't be too hard to make a group administrator sign an agreement in regards to how they may spend group funds. The problem is that group funds are vulnerable to third parties. e.g. The fraternity president goes on a bender and runs someone over. The victim will be able to go after "group" funds due to the personal liability of the group administrator. I don't have a solution for this, though I imagine a lawyer could work one up. Unfortunately, this is one of those cases where the paper work and legal fees for setting something up (trust? nonprofit?) are completely out of proportion to the assets trying to be protected.
As far as I can tell, WePay essentially provides a personal bank account with methods of billing and sharing information with other people. Useful, but handwaving about "groups" doesn't carry a lot of weight with the IRS or courts.
Depositing the money into your personal bank account is precisely what you are doing with WePay. WePay should be solving problem (2) but instead has tried to just obscure problem (1).
As you stated earlier, the amount of funds being protected is usually out of proportion to the amount of effort required to register an organization, obtain an EIN and open a bank account.
For groups that want the additional protection, we encourage them to setup a full fledged bank account. In the future, we are exploring ways to have our accounts in the name of organization tax IDs as well.
For the most part, we are replacing cash and checks in personal bank accounts with a simple & transparent solution. We are a far better solution here, and are not trying to "obfuscate" anything.
They've got moxy.
I personally have been soured on the idea of "stunt" marketing since businesses started having the "moxy" to pay someone to tattoo the company logo on their head, or to run a "shockingly" racy or edgy ad during the superbowl. Etc..
This isn't among the worst by a long shot, of course, but... well, it's a big block of ice used to make a bad pun about an actually fairly nuanced topic, and doing stunts for press does set them in a fairly dubious crowd.
Kudos to WePay if it does work out for the better, but I hope we don't see more of these.
You are a security guard at the Moscone Center in San Francisco. There are hundreds of dollars inside a six hundred pound block of ice. You cannot leave your station. How do you get at it?
Using an ice pick? Why would a security guard have an ice pick? Maybe if it were Chicago, but this is San Francisco.
Use another tool to chip away at it? I dunno, that's a lot of ice.
Melt the ice somehow? Nice idea, but how?
Wait.
It also requires the security guard to have access to a private place with a large door whose floor won't be damaged when six hundred pounds of water gushes onto it.
>
When will you guys do international payments ?
we're steadily marching towards it, but we have a lot of work to do here at home in the U.S. before we can expend the resources necessary for international expansion. i don't have a date for you, unfortunately.
It's a better marketing stunt if it's actually money, though. Leaving a significant (but not implausibly large) sum of money out in the open but apparently completely inaccessible -- it motivates people like us to think about ways to get the money out, and here we are talking about a company whose existence I would otherwise have forgotten.
If it turns out to be fake money I'll be very disappointed in you, wepay.
What's wrong with AlertPay? They seem like a pretty honest business and I've never had any trouble with them, though I've only ever bought things, not sold them.
Other than that, it's a pretty solid service.
Nothing wrong with alertpay per-se that I'm aware of but fraud is rampant there.
This is to be taken with a grain of salt, but a search for 'paypal fraud' turns up 2 million results, about twice as much as alertpay, and given the relative size of the companies that's worrisome.
AlertPay charges 4.90% + 25c
WePay charges 3.5% (50c minimum)
(for credit card processing)
The dividing line (between the traditional macropayment and the micropayment) is supposed to be $12. The only drawback is that you have to run it from a different PayPal account.
For a $2 transaction, the macro works out to 30.058c fee, while the micro is 15c fee. For small stuff, it may be a better deal.
More free press! And a much longer running story.
People like to read about a stunt, though.
This would be a whole new category of firm. Stunt marketing. You give us money, we get you attention.
Hey, that actually sounds like a pretty fun business to run.
b) "We defintely see ourselves as a competitor to PayPal, says WePay co-founder Richard Aberman."
http://www.bankingreview.com.au/2010/06/we-came-wepay-we-con...
i'd be willing to pay somewhat more for the same service if i have more of an assurance that my funds won't get frozen/confiscated/etc., and/or if the product were easier to work with.
edit: hell, if wepay is partnering with a bank, if they can set things up so that i can get a debit card associated with that account and accept transfers, i'd use it as my primary business account for at least my smaller online business stuff.
As for debit cards, those are easy to get. Incredibly easy, and easy to integrate with as well. Again, it's nothing special. I've been there, I've done it. A complete system where you could transfer money into your account tied to a debit card, send money, receive money, automated API, etc.
It sounds great on paper, but really, none of this is disruptive.
sometimes its about timing, and at this point in time, there are a lot of people who are really angry with paypal.
"At this point in time" has been for more than a decade. People have always been angry with PayPal.
> in what way do you think wepay right now is disruptive?
I don't think it is. It's not at all disruptive to PayPal. And I'm not even talking about the biggest limiting factor right now for WePay: lack of support for non-US payments.
and yet people don't have a viable alternative that provided the same or similar serivces. i'd stop using it almost immediately if had one.
> I don't think it is. It's not at all disruptive to PayPal
then why does it matter if it pivots or not?
You've lost me. I never said anything about this. Maybe your confusing me with someone else?
So...what's left, then, to lock people into PayPal? Are you saying that if you can just get people to use debit instead of credit, it's easy to provide all the same services as PayPal?
Certainly sounds like the necessary infrastructure is in place for whoever wants to take a shot at being a PayPal disruptor at least.
> Certainly sounds like the necessary infrastructure is in place for whoever wants to take a shot at being a PayPal disruptor at least.
The infrastructure is there. That hasn't been the problem for a long time now.
Wrap them. My guess is that fewer than 1% of PayPal transactions go awry, and that PayPal renders it difficult or impossible for the injured part to recover their loss in perhaps 1% of those transactions. If there is in fact any real, widespread dissatisfaction with this state of affairs, then you could set up a site to act as a proxy for receiving PayPal transactions and self-insure it again PayPal's malice and/or incompetence. Monetize by keeping a very small premium over PayPal's own rate.
If PayPal is really that risky to do business with, then sellers won't mind paying 2.6% instead of 2.5%, or whatever PayPal charges.
If, on the other hand, all this talk of PayPal freezing accounts is mostly just a bunch of FUD, then there's no point trying to compete with them at all unless you can do it on the basis of lower transaction charges.
The biggest problem I see is that the only people who buy insurance will be the ones who are most at risk of needing it...
Their FAQ page (https://www.wepay.com/about/faq) features a nice little graphic of questions being asked from all over the world. Great, I thought - one thing PayPal was a bit rubbish at to start with was international payments - WePay must have cracked it.
Down we go to question 13 (https://www.wepay.com/about/faq#thirteen) and we see that no, WePay doesn't accept international payments!
I would rather try and unfreeze my money than not receive any at all.
It seems every month someone is posting about their money being held hostage or outright stolen by PayPal. Most of these complaints are from well-known bloggers/engineers/HN members, so I can only imagine how many people without a voice online are getting screwed. When you're dealing with people's money, you have a strong obligation to handle issues like this with speed and clarity, because money affects people's lives in serious ways. Yet Paypal's customer service doesn't seem to care, and they often take months to reply.
Why should WePay have respect for a competitor that doesn't respect its own customers?
A company has to have its own culture of respect irrespective of what culture its competitors have. No where in my comment did I say that I admire Paypal's practices. I just said I found what WePay did a bit naive and a cheap trick. It has nothing to do with Paypal
HNers: just because you disagree with a comment doesn't mean that you should downvote it. It is a personal opinion and in no way frivolous or off-topic.
however - we do vehemently disagree with the way they treat their customers and won't pull punches when we express ourselves about a topic we care dearly about
I think their attitude vis-a-vis their competition is right -- they certainly do want to ridicule PayPal and flaunt their problems, etc.
The idea that they won't have to freeze their own accounts periodically (b/c of exposure to the same kinds of fraud PayPal sees), though, is reckless, naive, or just plain false advertising.
THAT would have been even more Epic!
Fraud should not have to be Paypal's business. If someone says they're a charity and they're not, and you give them money, it's your fault. PayPal should not be involved in that kind of trickery; PayPal should only assist the law in settling those issues.
Just like Craigslist only advises people on wire fraud, but doesn't get too involved, so should Paypal. They're simply a middleman.
But you still go to your credit card company, dispute the charge, and get a chargeback. This chargeback hits PayPal with a $20+ fee, so of course they're going to be involved.
It is all about detecting fraud. PayPal lived while others died because they figured fraud out, and came up with working solutions to limit it to the point where the fraudsters choose easier targets.
"Actually, in the 'Founders at Work' interview, ..." would have been less aggressive in tone.