Honey, will join PayPal's two-sided network, to transform the shopping experience for PayPal's consumers in a bid to increase sales and customer engagement for merchants.
Founded in 2012, Honey is best known as a popular discovery tool that helps consumers find savings as they shop online. The company has continued to grow and evolve, expanding its suite of products and services to include a mobile shopping assistant, offers and rewards program, and price-tracking tools and alerts. With approximately 17 million monthly active users, Honey says it has helped millions of people find more than $1 billion in savings in the past year. Honey currently works across approximately 30,000 online retailers ranging from fashion and technology, to travel and pizza delivery.
The acquisition supports PayPal and Honey's shared mission to simplify and personalize shopping experiences for consumers while driving conversion and increasing consumer engagement and sales for merchants. The combination is expected help accelerate growth across both companies. Honey will accelerate its growth by driving adoption among PayPal and Venmo's more than 275 million active consumer accounts and sourcing exclusive offers from PayPal's extensive network of 24 million merchant accounts. Honey will enable PayPal to reach consumers at the beginning of their shopping journeys and will enhance PayPal's ability to help merchants acquire and convert consumers by delivering offers that are personalized, timely, and optimized across channels.
"Honey is amongst the most transformative acquisitions in PayPal's history. It provides a broad portfolio of services to simplify the consumer shopping experience, while at the same time making it more affordable and rewarding," Dan Schulman, president and CEO of PayPal said Thursday. "The combination of Honey's complementary consumer products with our platform will significantly enhance our ability to drive engagement and play a more meaningful role in the daily lives of our consumers. As a partner of choice for our merchants, this is another way that we can help them build and strengthen their customer relationships, provide personalized offers, and drive incremental sales. The combination of Honey and PayPal adds another significant and meaningful dimension to our two-sided platform."
Honey will retain its headquarters and brand in Los Angeles, California. Honey co-founders George Ruan and Ryan Hudson will continue to lead the Honey team as part of PayPal's global consumer product and technology organization, reporting to Senior Vice President John Kunze.
"Honey's vision has always been to give consumers the tools they need to make the best decisions with their money," said Ruan. "PayPal shares that vision and together we can build powerful commerce capabilities that create real value for both consumers and retailers around the world."
"Combining PayPal's assets and reach with our technology, we can build powerful new online shopping experiences for consumers and merchants," said Hudson. "We'll have the ability to help millions of retailers efficiently reach consumers with offers that deliver more and more value to Honey members."
Honey was profitable on a net income basis in 2018. The transaction is expected to close in the first quarter of 2020.
Perella Weinberg Partners LP is acting as sole financial adviser to PayPal, and Skadden, Arps, Slate, Meagher & Flom LLP is acting as its legal adviser with regard to the transaction. Qatalyst Partners is acting as sole financial adviser to Honey, while Latham & Watkins, LLP is acting as its legal adviser.