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An article relating to this blog post on Finextra:

PayPal waives processing fees for start-ups

PayPal is offering to waive up to $50,000 in processing fees for 18 months for young mobile and Web firms as part of its new Blueprint Startup programme.

See article

It's hard to pick a winner in the future of payments

PayPal has been doing a fair bit of engagement over the past 5 years with its burgeoning developer community and reaching out to start-ups, as you would expect from any mature, successful Silicon Valley company.

In its most recent program it is itself nominating candidate startups to receive up to $50,000 in waived processing fees by way of support, and also accepting recommendations from its partner start-up incubators. Previously from 2009 to 2011 it offered a mix of cash/waived-fee prizes as part of developer challenges in its X developer community.

On the back of its recent announcement I thought it would be interesting to look back at those apps and companies that PayPal has previously picked as winners, and see how they're doing today.

The winner of their first developer challenge, taking out a $100,000 prize, was Rentalic - an online person-to-person marketplace for owners to rent anything that they own, from vacation properties to camping equipment. Rentalic used PayPal's preapproval API to validate that a customer has sufficient funds for a rental fee and deposit in a PayPal account before making a reservation.

It was a pretty sweet-sounding idea. But it looks like traction was hard to come by. The last tweet from the company was in October 2012, and the domain and brand name now appear to be for sale on Brand Arrows for $7,245 .

Second-place that year seems to have fared a bit better. Appbackr is a crowdfunding/wholesaling platform for app ideas and finished apps that has since branched out into app distribution across multiple stores, app quality scoring and app discovery algorithms.

PayPal's second challenge was won by iConcessionStand, which despite its clumsy name took out the grand prize for its mobile app that helps consumers skip standing in long lines at live events. Food, beverages and merchandise orders can be made within the app and paid for with a PayPal account. Customers are alerted when the order is ready for pickup or are served by runners.

The company has since rebranded as Yorder, but doesn't seem to have branched out much beyond Seattle restaurants and food trucks, a few West Coast sports stadiums and a handful of Texas eateries. There are a range of similar apps available on the app stores, and each seem to have a geographic focus in terms of the vendors that use them.

The last X Developer challenge PayPal ran in 2011, before PayPal and eBay merged their developer programs, and was focused on Android Apps. The winner was Mopper, a Swedish developer with a QR code reader that integrated with PayPal's API to enable users to make a purchase directly from scanning a printed QR code. Mopper seems to be doing quite well as a general mobile and QR code marketing services and consultancy firm in Sweden. But even with QR codes not really having taken off the way some had hoped, there are now plenty of other QR code and app solutions doing similar things, and instructions freely available for building a mobile payment solution that incorporates PayPal processing

This is by no means a comprehensively researched appraisal of these companies, but it does illustrate that a compelling idea well excecuted might be enough to win a prize, but it won't guarantee new market creation or domination.


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