According to people familiar with the matter, PayPal has made an offer to buy digital pinboard site Pinterest for $45 billion. If the transaction is completed, it could be the first of many partnerships between social media and fintech companies in e-commerce, expected to become common place.
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Over the past 18 months the share price of PayPal has increased by more than a third, as many more people turned to its services as a result of the ongoing pandemic. It now has a market capitalisation of about $320 billion. The reported $45 billion price for Pinterest would constitute a 26 percent premium on its current market capitalisation.
The news led to an increase of Pinterest’s share price of 10 percent, after having decreased by about 16 percent over the course of this year. PayPal’s shares were down by about 4 percent at the same time. Neither PayPal nor Pinterest responded to requests for comment following the news, and the sources asked to remain anonymous as the discussions were still confidential.
Earlier this month, Pinterest said it was rolling out new features for advertisers and brands to promote their products to users on its site. The launch marked the company’s latest initiative to grow online shopping and advertising on its platform. In April 2020, the company launched a new way to shop on its platform, giving Pinterest users the ability to browse in-stock inventory from newly added “Shop” tabs on Search and on Pinterest boards. The company also improved visual search to make more products shoppable from Pins.
On October 14, Pinterest announced that co-founder Evan Sharp was exiting his full-time role with the company, where he had served as chief design & creative officer, in order to join Jony Ive at his new creative collective, LoveFrom. Sharp has moved into an advisory role with Pinterest, which will focus on company strategy, product, design, brand and culture. He will also continue to serve on Pinterest’s board of directors.
