Partnerships / Acquisitions

Online Coupon Company Honey Nets Founders $1.5B After Sale

Online Coupon Company Honey Nets Founders $1.5B After Sale

George Ruan and Ryan Hudson, the co-founders of online coupon service Honey, received a pre-tax haul of $1.5 billion after their company was sold to PayPal, according to a report Tuesday (Jan. 28)  by Bloomberg.

The men are from Los Angeles and the company was sold for $4 billion. After taxes, Ruan will get $900 million and Hudson will get about $575 million.

Honey is a service that automatically searches for coupon codes when a person is checking out online. PayPal said it was going to use the service to help customers have a better shopping experience as well as market it as a way for merchants to boost sales with more personalized offers. 

Other FinTechs have also been doing well, like Plaid, which recently sold to Visa for $5.3 billion, and Robinhood Markets, which saw its market share soar, making billionaires of its founders Vlad Tenev and Baiju Bhatt.

The acquisition is the largest ever for PayPal, and it gives the payment company access to customer data on buying habits.

Both Hudson and Ruan are going to continue to run the business, which is used by 17 million people a month. 

The acquisition may have caught the eye of Amazon, who, over the holiday season, told customers to uninstall Honey.

Amazon said the extension posed a “security issue.”

“Honey tracks your private shopping behavior, collects data like your order history and items saved, and can read or change any of your data on any website you visit,” Amazon said. “To keep your data private and secure, uninstall this extension immediately.”

Amazon has its own version of Honey, called Amazon Assistant.

“Amazon Assistant helps you discover Amazon products and compare prices as you shop across the web,” the extension said on its site.

This is the first time Amazon has said anything negative about Honey, and the plug-in has worked on Amazon for the last seven years.

“Our goal is to warn customers about browser extensions that collect personal shopping data without their knowledge or consent such as customer name, shipping and/or billing address and payment method from the checkout page,” an Amazon spokesperson said.

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Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.

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