PayPal Holdings, Inc.announced that it has agreed to acquire Honey Science Corporation, a rapidly-growing technology platform for shopping and rewards, for approximately $4 billion.
Honey, in combination with PayPal’s two-sided network, will transform the shopping experience for PayPal’s consumers while increasing sales and customer engagement for its merchants.
Founded in 2012, Honey is best known as a popular discovery tool that helps consumers find savings as they shop online. Honey 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 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 will 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,” said Dan Schulman, president and CEO of PayPal.
“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,” continued Dan.
Following the acquisition, 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. PayPal shares that vision and together we can build powerful commerce capabilities that create real value for both consumers and retailers around the world,” said Ruan.
“Combining PayPal’s assets and reach with our technology, we can build powerful new online shopping experiences for consumers and merchants. We will have the ability to help millions of retailers efficiently reach consumers with offers that deliver more and more value to Honey members,” said Hudson.
Honey was profitable on a net income basis in 2018. Subject to customary closing conditions, including the receipt of regulatory approvals, the transaction is expected to close in the first quarter of 2020. The acquisition is expected to be accretive to PayPal’s non-GAAP earnings per share in 2021.