Some of the richest and most influential figures in tech including YouTube, Yelp, Tesla, and LinkedIn all have one thing in common: they all worked at PayPal during the early 2000s.
This elite group came to be known as the "PayPal Mafia," a nickname that gained popularity after Fortune featured the term in a 2007 piece along with a photo of some of the members dressed in gangster attire. Members of the group include Elon Musk, Peter Thiel, and Reid Hoffman, along with over a dozen others. Here's a breakdown of each of the most prominent members.
And, what they're up to now, nearly two decades later.
The Origins of the PayPal Mafia
The PayPal Mafia, a group of early PayPal employees and founders, played a pivotal role in shaping the startup culture and entrepreneurial spirit that defined Silicon Valley in the early 2000s. These individuals were not only instrumental in the success of PayPal but also went on to create their own highly successful companies.
At the heart of the PayPal Mafia was a shared passion for innovation and disruption. The culture at PayPal encouraged employees to think outside the box and take risks, fostering an environment conducive to entrepreneurial pursuits. This mindset, coupled with the experience gained from building PayPal into a global financial powerhouse, provided the foundation for these individuals' future endeavours.
What differentiated the PayPal Mafia from other groups of entrepreneurs was their ability to leverage their collective expertise and network. The close-knit nature of their relationships allowed for collaboration and support as they navigated the challenges of building their own companies. Their success not only served as inspiration for aspiring entrepreneurs but also highlighted the power of a strong business network.
Back in 1999, Peter Thiel cofounded the company that would become Paypal (alongside Max Levchin and Luke Nosek) — known at the time as Confinity.
Confinity was launched as a developer of security software for hand-held devices like the PalmPilot, but it later pivoted toward digital money transfers.
Thiel served as CEO of PayPal until October 2002, when eBay acquired the company for $1.5 billion. Thiel's 3.7% stake was worth $55 million, according to SEC filings. Thiel then went on to cofound Founders Fund, a venture capital firm that has helped launch companies like SpaceX and Airbnb.
According to Bloomberg, Thiel now has a net worth of over $8 billion.
He was the first major outside investor in Facebook and contributed early funding to Yelp and LinkedIn, along with a number of other ventures launched by his PayPal peers. Thiel's also a partner of Founders Fund, a venture capital fund based in San Francisco.
Thiel the first major outside investor in Facebook and also provided early funding for Yelp and LinkedIn. He is a partner at Founders Fund, a venture capital fund in San Francisco. Thiel has faced criticism for supporting President Donald Trump, secretly funding Hulk Hogan's lawsuit against Gawker Media (leading to Gawker's shutdown), and serving as an FBI informant, according to Insider.
Max Levchin is often called the "consigliere" of the PayPal Mafia — in reference to the classic film, "The Godfather," in which a consigliere acts as an advisor to the boss.
Levchin contributed to PayPal's anti-fraud efforts. With Gausebeck, he created the Gausebeck-Levchin test, an early CAPTCHA for commercial use.
After eBay acquired PayPal, Levchin founded Slide, a media-sharing service bought by Google. He was also an early investor in Yelp, becoming the largest shareholder. Levchin served as chairman of Yelp from 2004 until July 2015.
He has since founded Affirm, a fintech company which allows consumers to finance online purchases at the point of sale and pay for them over time. Affirm went public in 2021, raising $1.2 billion in its IPO. Levchin is also the chairman of Glow, a fertility-tracking app that helps users improve their odds of conceiving.
Ken Howerey - The Ambassador
After serving his role as PayPal cofounder and CRO from 19980-2002, Howerey stayed with eBay following its acquisition of PayPal as eBay's director of corporate development until 2003.
He was recently appointed US ambassador to Sweden.
Today, Howery is still active in several nonprofits, serving as an advisor to Kiva, cofounded part by PayPal's former product manage, Premal Shah. He also works with Peter Thiel, cofounding the Founders Fund.
Howery are Elon Musk are reportedly still good friends.
Ironically, Elon's recent purchase of Twitter (now X) wasn't his first. In 1999, Musk founded X.com -- a payments company which merged with PayPal in 2000. Musk briefly served as CEO of PayPal before being replaced by Thiel.
As the company's largest shareholder, Musk walked away from PayPal before it was acquired by eBay with a reported $165 million.
As the most well-known member of the PayPal mafia, Musk has built an estimated net worth of $209 billion, going on to create notable companies such as Tesla, SpaceX, the Boring Company, and Neuralink.
Recently, he bought Twitter and X.com domain name (from PayPal) and as of now, is re-living his X.com do-over without being booted off the board.
Other Notable Mafia Members
Luke Nosek - PayPal cofounder and vice president of marketing and strategy.
Karim, Hurley, and Chen met at PayPal as web designers.
But, after eBay's acquisition, they went on to start their own passion project -- YouTube. After uploading an 18-second clip of Karim in front of an elephant at the San Diego Zoo (the first-ever YouTube video), the iconic video-sharing platform was born.
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