PayPal was established in December 1998 as Confinity,[12] a company that developed security software for handheld devices[13] founded by Max Levchin, Peter Thiel, Luke Nosek, and Ken Howery.[12][14] PayPal was developed and launched as a money transfer service at Confinity in 1999, funded by John Malloy from BlueRun Ventures.[15][16]
In March 2000, Confinity merged with X.com, an online banking company founded by Elon Musk.[17] Musk was optimistic about the future success of the money transfer business Confinity was developing.[18] Musk and then-president and CEO of X.com, Harris Fricker, disagreed on this point and Fricker left the company in May 2000.[18] In October of that year, Musk made the decision that X.com would terminate its other Internet banking operations and focus on the PayPal money service.[19] In the same month, Elon Musk was replaced by Peter Thiel as CEO of X.com. The X.com company was then renamed PayPal in 2001,[20] and expanded rapidly throughout the year until company executives decided to take PayPal public in 2002.[14][21] Paypal's IPO listed under the ticker PYPL at $13 per share and ended up generating over $61 million.[22]