Quan Zhou

Case Study- PaYPal

                        American Peter Theil was the founder of PayPal and former securities lawyer and options trader with his friend Max Levchin who saw the need for a secure software system that allowed electronic transfer of payments. They had several ideas before coming up to the point of doing transactions in a web-based payment system. Anyhow this is not really what Theil wants to do, his focus in college was more on security. He’s not also sure what he was going to do with his life until he found out that millions of people were begging for security in their handheld devices so he decided to start up an online payment and securities for their money.

                        PayPal allows people to make financial transfers between computers and it has turned into one of the world’s most important methods of online payment. The service grew so quickly that it soon became the default online payment service. PayPal is an online payment service that allows individuals and businesses to transfer funds electronically. You can use it to pay for online auctions, purchase goods and services, or to make donations. You can even use it to send cash to someone. Buyers wanted to use it since so many merchants accepted it, and merchants accepted it because so many buyers were using it. PayPal owes much of its initial growth to eBay users who used the service to pay for items and accept payments for their online auctions.

                        Like the other companies, there are unexpected problems that are unavoidable and PayPal also encountered fraud problem which cause them to lose millions of dollars. Peter and Bob created IGOR which lessens the fraud.

Case Study- Hotmail

                        Sabeer Bhatia was a software engineer and decided along with a friend that he wanted to make a difference in the world that he was familiar with. He was also looking for a permanent job and he knew that working in Apple Company was just a temporary job for him. So he decided to join the startup and found out that the Internet thing can stay for a long time and permanent. Because of this, he explored and came up with the idea to do a simple-to-install mail, were people can do free email accounts that could be accessed from any computer with an Internet connection. Email was something that anyone can use and this is to provide free access to the email from any web browser from anywhere in the world that can also be open in our own house or at work.

                        Hotmail, is a free webmail service of the Windows Live brand provided by Microsoft. It originates from Hotmail, founded by Jack Smith and Sabeer Bhatia and launched in 1996. It was one of the first free webmail services and hotmail was acquired in 1997 by Microsoft.

                        Good thing that he has a Windows Architect friend who can help him to build his business plan and Jack was surprised when he heard his friend’s idea about entering the world of new Electronic Mailing. He had a hard time on starting up his business in the Internet because there is no one wants to invest on their business plan because the investors doubt the two young kids.  They also have encountered some turning points, like getting a high fund because they needed $3M for it instead of $300,000 approved by the investors for starting up. But when they launched their hotmail, everybody loves it and it’s spreading all over the world in a very rapid way. 100 people are signing up for the last hour and became 200 people for the next hour. See how it spread so fast and it motivates the whole company seeing the people who have just signed on.

                        They didn't stop with this, Bhatia has a service intended to optimize hotmail for the developing world, where email is stored in a cache on the computer, so that the time taken to recover the emails is not too long. He wants to extend this service to the other email service providers as well. Sounds like a decent idea from him.