while, Peter took some time off. The guy who ran X.com became the CEO, and
I remained the CTO. He was really into Windows, and I was really into Unix.
So there was this bad blood for a while between the engineering teams. He was
convinced that Windows was where it’s at and that we have to switch to
Windows, but the platform that we used was, I thought, built really well and I
wanted to keep it. I wanted to stay on Unix.
By summer 2000, it seemed like the Windows thing was...

them, “No. Don’t do it.” So for a while we were fighting, tooth and nail, crazy
eBay people: “Go away, we don’t want you.”
Eventually we realized that these guys were begging to be our users. We
had the moment of epiphany, and for the next 12 months just iterated like crazy
on the website version of the product, which is today’s PayPal. Sometime by late
2000, we killed the handheld one because we peaked out at 12,000 users. They
were still using it a little bit, and they were really upset when we...

we needed two Palm Pilots, one for the receiving and one for the sending. I was
fully prepared. They were marked, “Sender A, Sender B, Sender C, Receiver A,
Receiver B, Receiver C.” So I had this stack of Palm Pilots, I hopped in a car,
drove to Buck’s, and it was like 9:50 a.m. Peter was getting very anxious about
the whole thing. That’s where everything becomes very blurry, because I was so
tired by then.
There were about a dozen TV cameras and journalists—there was really big
coverage. We did the...

a Palm Pilot, which at this point is very quaint and silly since, clearly, what
would you rather do, take out $5 and give someone their lunch share, or pull
out two Palm Pilots and geek out at the table? But that actually is what moved
the needle, because it was so weird and so innovative. The geek crowd was like,
“Wow. This is the future. We want to go to the future. Take us there.” So we got
all this attention and were able to raise funding on that story.
Then we had...

happened.
Livingston: Tell me about how you adapted the strategy.
Levchin: Initially, I wanted to do crypto libraries, since I was a freshly minted
academic. “I won’t even need to figure out how to do this commercialization
part. I’m just going to build libraries, sell it to somebody who is going to build
software, and I can just sit there and make a penny per copy and get marvelously
rich very quickly.” But no one was making the software because there
was no demand. So we said, “We’ll make the software.” We went...