If you added PayPal to these charts it'd be well below all of the lines at all of the price points. It'd start at around 3% and drop to 2.2% very early in the graph. Plus, for most startups, not accepting PayPal is going to cost you customers. Especially non-US customers.
In addition to the simple "Pay with PayPal" button scenario where you get all the simple subscriptions-as-a-service features built in (automatically handling failed payments and retries and notifying you of subscriptions, payments, cancellations, expiration of services, etc)... they'll also power your normal credit card payment forms on-site, and do token-based recurring billing (authorize payment once, charge the customer a variable amount whenever you need).
That startups discount PayPal entirely because it's "not cool" and you can't chat with the founder at 4AM about your implementation is astounding to me. All of these other services are very expensive, less fully featured, and none of them come with 240 million pre-registered users and brand trust. Any reasonable decision maker should be at least considering them an option.
I've been reading PayPal horror stories since I-don't-remember-when. I only recently started bookmarking them under their very own tag in pinboard so that when they get brought up again I can bring a few examples to bear:
That's only the stuff I've read recently. So, seriously, I'm happy for you that PayPal is working great so far. Awesome! But, people aren't avoiding PayPal because it's "not cool", they're avoiding PayPal because they've paid attention to its numerous institutional problems and they'd like to do business instead with a company that at least tries to be decent.
Sneering at people making such a measured decision is also "not cool".
Speaking from the startup's side, I feel a lot of startup hate for Paypal comes from these horror stories. But in reality any low cost service will have bad customer support (Gmail customer support anyone?).
Also, take into account the fact that Paypal has millions of users, so even a 1:million horror story rate will explode into thousands, whereas for these new startups, I doubt they even have a million customers.
Yes, their customer support is stubborn, paranoid, and OCD. They might even sneer at you, but learning to work with them may be one of the best paying skills to have if you're processing volume.
Also, I give paypal credit for taking almost everyone under their wings. Half the people using paypal couldn't get a merchant account with any real reputable bank. They have paranoid security because their standards are so low.
And of course on the other side, if you're willing to give up a percent or two for being treated kind and by the "right people" then of course these startups will probably suit your need better.
Using PayPal is basically a crap shoot for recurring virtual services. As one poster on Hacker News said, if you aren't putting physical items in boxes and shipping to customers homes, you aren't in PayPal's target market.
I have to disagree with that. I think the vast majority of businesses, even those selling services, have no problems working with PayPal. Services and virtual goods are as baked into their service as physical ones -- anywhere you describe a payment, in sending, accepting or disputing one, 'service' is an option in the dropdown. Their buyer protection policies and seller protection policies explicitly call out what portions apply and don't apply to virtual goods. Not shipping a tangible item does not automatically put you in a bad position with disputes or chargebacks -- I win virtually all of them.
I consume a lot of other SaaS products, and the majority of them accept PayPal alongside credit cards. I run several "recurring virtual services", and have done so for many many years, and have hundreds of subscribers paying with PayPal. My PayPal account is 11 years old now and some of my PayPal subscribers have been around more than half that long.
When PayPal's customer service fails it tends to fail spectacularly, but all evidence points to these failures being exceptionally rare given the size of their user base.
Nothing to do with "not cool". It's their customer service.
I'd love to use PayPal price wise, but I just don't trust them. I feel like at any time they can freeze my funds, have final decisions made by very low ranking support staff (with no ability to escalate) and lack of accountability (sure, I can go to FSA, but how much company time will that cost me? They should govern themselves fairly first).
That's true of any service though. Just because they haven't yet doesn't mean they couldn't in future.
I think payment processors must have very similar mean-transactions-between-failure and the smaller operators aren't yet handling the scale of transactions where you'd start to see failures.
I trust them with my business. So do millions of other businesses -- more than all the other companies in this thread combined. So do major YC companies like Weebly and Carwoo.
Well, the Paypal cost line starts low but then has a sudden spike to infinity when Paypal cancels your account, steals all your money, and refuses to speak to you about it.
It's been a long time since calculus but I think the area under the curve when the curve goes to infinity is also infinity. So Paypal's cost is actually a bit steep.
Show me a way to accept credit cards without the risk of that happening. Please. Don't come back with Google Checkout, Amazon Simple Pay, 2Checkout, WorldPay, or any real merchant account provider -- because you'll find in their terms and their customer stories that they do the same thing. You think PayPal won't talk about it? At least they have a phone number you can call! Try getting one from Google.
I've had a merchant account do it to me personally -- cancel my account and hold thousands of dollars of my sales for 6 months while I had to fill those orders without any revenue. This is how the payment industry works, not how PayPal works.
I've got no idea why you're being downvoted - perhaps your last paragraph is a little harsh. But you're right, it's odd not to see mention of PayPal. It works, it's inexpensive, and for non-US businesses it's one of the few available options.
He's probably being downvoted by people who have extensive experience in dealing with PayPal. Dealing with PayPal's rather frequent API outages can be hell for businesses and developers. If you have a small enough business that you don't need to use the API, then go for it, but otherwise, you might just wind up scraping the PayPal site pages when there's an outage.
We're looking into PayPal, but I try to avoid systems that put strict limits on what I can do with my customers. Things like refunds, deferred charges, adjusting price up and down, etc. I can do all that easily with Chargify, but I'm not so sure about PayPal.
In addition to the simple "Pay with PayPal" button scenario where you get all the simple subscriptions-as-a-service features built in (automatically handling failed payments and retries and notifying you of subscriptions, payments, cancellations, expiration of services, etc)... they'll also power your normal credit card payment forms on-site, and do token-based recurring billing (authorize payment once, charge the customer a variable amount whenever you need).
That startups discount PayPal entirely because it's "not cool" and you can't chat with the founder at 4AM about your implementation is astounding to me. All of these other services are very expensive, less fully featured, and none of them come with 240 million pre-registered users and brand trust. Any reasonable decision maker should be at least considering them an option.