PayPal Acquires iZettle for $2.2 Billion to Expand POS Capabilities
On May 17, 2018, PayPal confirmed its $2.2 billion all-cash acquisition of iZettle, a Swedish payments company often referred to as the 'Square of Europe.' The deal, PayPal's largest acquisition to date, was designed to strengthen PayPal's offline point-of-sale presence and expand its reach among small and medium-sized merchants. iZettle's card-reading dongle and integrated POS systems operated in 12 markets including the UK, Germany, Sweden, and Mexico, giving PayPal a foothold in regions where it sought growth. iZettle CEO Jacob de Geer was expected to remain and lead the business under PayPal COO Bill Ready. The startup projected $165 million in 2018 revenue with $6 billion in payment volume and had achieved 60% compound annual growth from 2015 to 2017, though it was not yet profitable.
The acquisition surpassed PayPal's prior major deals including Xoom ($890 million) and Braintree/Venmo ($800 million). The transaction was expected to close in Q3 2018.
- PayPal's move into offline POS significantly intensified competition with Square and Stripe in small-business payments
- The acquisition signaled growing consolidation in the payments space as major fintechs sought integrated online-offline capabilities
- iZettle's European and Latin American footprint gave PayPal a direct embedded commerce presence in underserved SME markets