EBay the giant web auction superstore announced the purchase of the internet payment processing firm Braintree. Why EBay purchased Braintree? EBay has been watching Braintree for sometime as it has been expanding over the five years. Ebay also made a smart move in the past when it purchased PayPal, because web payment processing is important for eBay business model. Furthermore, eBay wants to expand it’s mobile payment processing business using Braintree model. Braintree has been processing payments for many big name merchants and companies such as Uber, Airbnb, Rovio, TaskRabbit and OpenTable. Customers of Braintree can set up mechant accounts to process online payments using Braintree platform. The addition of Braintree to Ebay will strength eBay’s business model. Moreover, eBay will increase it’s dominance of the online payment and processing business that is dominated by eBay owned web payment processing giant Paypal.

Braintree is Chicago-based processing firm. It was founded by Bryan Johnson in 2007. The successful startup raised over $70 million from Accel Partners and other venture capital firms. Braintree process more than $4 billion annually in mobile payment transactions. Braintree fast expansion in the mobile side of the payment processing business increased it’s potential for greater market and profit. Therefore eBay saw the great potential in braintree to expand PayPal market further into the mobile sector.