Don’t say I didn’t tell you. As I related in June 2025 The Shakeup PayPal Needs, Dan created a dumpster fire that the BOD just added to in their AWOL engagement.
Yesterday PayPal delivered FXN Branded growth of 1%, and announced that PayPal CEO Aex Chriss is out and HP’s CEO Enrique Lores is in (March 1st). This event serves as the final, public admission of a decade-long strategic failure. Lores replacement of Chriss hopefully marks the end of an era of “spectator leadership” and the beginning of a desperate attempt to reintegrate a fragmented “mash” of acquisitions into a cohesive operating model. To understand the depth of the “dumpster fire” that Lores inherits, let’s look back across the last eight years, beginning with the BOD’s decision to renew Dan Schulman’s contract, a move that effectively decapitated PayPal’s operational core and set the stage for its current state of institutional irrelevance among top merchants
The first and biggest mistake the board made in 2019, when they let Dan renew as CEO. The only way Dan kept Bill Ready (one of the greatest payment execs of all time) was by promising Bill it was only a 5-year gig, and then the company would be his. Ready, who joined PayPal through the acquisition of Braintree and Venmo, was the primary architect of the company’s product and engineering revitalization. You can imagine Bill’s surprise when he had to sign the SEC 8k covering Dan’s new stock grant. No call from Dan, no heads up. PayPal never recovered after losing both John Rainy (top 5 payments CFO now at Walmart) and Bill.
Dan was (and is) a consumer marketer. His team sold a “button” while Adyen sold enterprise software. I told him that if he wanted to look more like Adyen, he needed to look more like Oracle up the street. Not only did he diffuse a consumer focus with remittance, banking the unbanked, a super app, ..etc. He also created a mash of acquisitions that only Bill and his team could have possibly cleaned up.
Consumer focused was diffused substantially, with PayPal attempting to build a “Super App” that bundled remittance, banking the unbanked, and rewards into a single consumer interface. This wasn’t a consumer need, it was a need for Dan to make sense and bring together all of his assets (see Super App on why it failed). While Dan chased a superapp that no consumer wanted, he missed the fundamental shift in the market toward unified commerce and developer-centric infrastructure. PayPal’s leadership was busy selling a legacy “button” to merchants who increasingly demanded the transparency and control offered by modern Payment Service Providers (PSPs).
The result was a “mash of acquisitions” that lacked a cohesive operating model. Braintree, Venmo, Xoom, and various rewards platforms functioned as silos, creating internal friction and technical debt that only an operator of Ready’s caliber could have potentially reconciled. Instead, the company entered a period of strategic drift, relying on its massive installed base while its core merchant value proposition eroded in favor of more integrated challengers
After Bill left, I told Dan his leadership team had no fire in their bellies, and he needed a new exec team. Most were acquisition CEOs who stuck around for their earn-out and a cushy job. He needed operators who could leverage the assets of PayPal (a mess of acquisitions) into a cohesive operating model. What he got was an exec team of spectators. But he liked people that got along well, I recommended that he seek a team with some friction. The market was changing, he didn’t have leaders to bring together his current assets in a static competitive environment, and CERTAINLY didn’t have the people to position PYPL in a new direction.
After Dan’s 2023 departure, the board followed up in their mess-making ways by appointing Alex Chriss as CEO. While he may be a nice guy, he had no payment experience, international experience, payment/compliance experience, or even experience dealing with PayPal’s main customer base: Merchants. Chriss’s tenure was defined by a series of defensive maneuvers collectively referred to as the “Q2 2025 Plan”. As a product guy he saw the mess and prioritized a massive restructuring aimed at modernizing the technology stack and reducing costs, with a projected spend of over $300 million. This wasn’t a bad idea, but the team totally missed the shift in the market and driving PayPal to where it needed to be, not fixing the execution on where it was.
If all these challenges weren’t enough, my survey of Merchant Risk Council merchants (comprising top 200 eCommerce merchants) was even more so. PayPal’s main customer base no longer cares. The theme of their feedback was
“they just aren’t relevant… we’re not shutting them down yet, as the 10% of customers they serve are great customers, but we certainly aren’t going to expand our biz with them until they drop pricing below cards. ApplePay and ShopPay have better conversion rates and auth rates, and I pay nothing for these services. The PYPL sales team are tone deaf. Shopify listens and works to fine-tune everything. PayPal just shows up with the latest shiny new product and tries to get me to buy. PayPal no longer takes time to listen”
What does the appointment of Enrique Lores mean?
Lores was the lead architect of the 2015 split of Hewlett-Packard Company into HP Inc. and Hewlett-Packard Enterprise (HPE). This was one of the largest and most complex corporate separations in business history, requiring the disentanglement of massive global supply chains, financial systems, and talent pools. He subsequently led the Separation Management Office, where he was credited with transforming HP’s cost structure and creating the “capacity to invest in innovation”.
Given this background, it would seem we are separating Braintree, Branded and probably remittance.
Path Foward
Organizationally Enrique needs to take decisive action:
- Install a leadership team that knows global payments. This is non-negotiable. The executive team must have deep expertise in partnerships, consumer payments, wallets, and the complexities of retail (and agentic).
- Fix the merchant value proposition or spin out Braintree.
- Integrate the assets into something that drives sustainable margin.
From a product perspective,
You running a network, create a network strategy (unless you sell Braintree). Then you are working on a consumer (branded) and merchant payout (hyperWALLET) strategy.
I covered this in PayPal’s “All In” on Consumer blog. After spinning out Braintree, PayPal must go all in on consumer. Why would anyone bother using PayPal today? The problem in NNA growth is clear. I do have a great deal of confidence in Ben Volk, and think he should be running consumer for Enrique.
Thoughts?
Great diagnosis of the historical context that led them to where they are todau. The fix is going to need to be more structural. PayPal’s problem isn’t execution, they seem to be engaged in all the important areas, it’s that the market is pricing them like a retail payments company not a network that is at the center of the trust, identity, and coordination layer necessary for the current environment.
They need a significant and decisive pivot to something we might call “Network v2”. Kill the Super App ambition and re-position PayPal as a neutral, merchant-aligned identity, authorization, and multi-rail orchestration layer that sits above cards, A2A, wallets, and agents. Unfortunately, a 3% growth in Opex needs to be replaced with a 10% reduction to fend off activists who are smelling blood in the water.
Position Fastlane as a wallet-agnostic identity and authorization layer (not a button), bundled by default with Braintree, priced on outcomes, and explicitly merchant-aligned. Make Braintree the agentic commerce API. Position Venmo as the identity and consent nucleus. Move all their credit exposure off-balance-sheet to a bank partner(s).
Make PayPal indispensable again as merchant infrastructure. Kill the Super App ego now by selling off Xoom, Hyperwallet and Honey, or activists will do it later.