
PayPal CEO writes personal response - Peteris
http://ndy.gd/JJgB
======
angryasian
The level of discourse on HN lately is absurd. Here is a new CEO that appears
to be looking to change things for the positive, yet everyone wants to be
cynical and doubting. Yet when startups have major f* ups, the conversation is
much different.

Lets all admit change is slow and that paypal is still one of the more trusted
payment solutions accepted globally. It would be nice to be able to use them
in the future with some continued reliability.

~~~
pygorex
The skepticism about PayPal is well founded. PayPal has rightfully earned a
reputation of imposing arbitrary decisions on account holders. Maybe if PayPal
was more transparent and actually provided some semblance of customer service
their decisions would appear more fair.

While its nice that the CEO has personally responded this actually shows a far
greater dysfunction. Why should it take escalating all the way up to the CEO
level to get someone at PayPal to listen and advocate for the customers
position?

The contrast with startups is misleading. PayPal has been in business for a
long time and is a billion dollar company. They have the resources to stop
making stupid mistakes, but still persist in their bad behavior. They can get
away with this because they've cornered a large part of the online payments
marketplace.

Sure, a startup is going to make mistakes. And they're expected to. That's all
a startup is really - a machine that generates mistakes in an attempt to find
(or build) a profitable market.

~~~
angryasian
Yes did you miss the part that they brought in a new CEO to bring change. Lets
just blame everything thats happened in the past on a guy who wasn't even on
the job. Blaming mistakes on lack of resources is a little naive.

------
noonespecial
This isn't special... Yet. What happened here can happen even in the most
dysfunctional customer service paradigms. A promblem randomly and luckily
escalated from the people who can't do anything about the problem to the
people who (generally speaking) won't do anything about the problem. As a
lucky break, the person/department who generally won't do anything, decided in
their mercy to do something this one time. IMHO, what was said in the email is
just marketing duck-speak, no matter how sincere it sounds until proven
otherwise.

The true fix, the actuall turnaround, is when the ability to actually fix
problems like this is systemically extended deep into the space previously
occupied by the employees who couldn't fix them before.

~~~
IsaacL
"IMHO, what was said in the email is just marketing duck-speak, no matter how
sincere it sounds until proven otherwise."

I agree that this looks like a PR stunt, but it also shows some potential
changes underfoot at Paypal.

Here's my read of the situation: Paypal has been known for being beauracratic
ever since the eBay acquisition, when all the smart people left and the bozos
and middle managers remained. You know the type of place and the type of
people it attracts: it's the smooth-talking-but-not-that-bright individuals
who do well, and any smart employees who perceive the real problems the
company is in find themselves a part of an outcast fringe.

Don't tell us we have bad customer service issues; expressing that kind of
negative attitude is not going to impress senior management, what with bonus
season coming up. Stripe and Square are just dipshit startups that no real
business will ever use. La-la-la I can't hear you.

It seems someone at eBay finally realised PayPal was going to be "disrupted"
if it didn't get a leader with their shit together. This new guy seems
competent, but steering a big lumbering ship like PayPal away from its death
course takes serious political/organisation-hacking skills, no matter how big
the icebergs loom.

~~~
AJ007
PayPal's reputation is so deep in the dirt that nothing any one at the company
says will bring it back above ground. If someone says "we are changing X" and
the changes actually happen, then eventually, over the course of time,
Paypal's goodwill may return.

~~~
jtheory
You're really overstating how "deep in the dirt" PayPal's reputation is,
though. Some developers complain very loudly about PayPal, but just about
everyone else continues to use the service.

They remain an interesting choice for anyone starting up a business that takes
money online -- I have a business that I've partially migrated to Stripe (and
I'll finish that up soon), but for about 9 YEARS before Stripe came along,
every year I'd evaluate the available options for accepting payments, and come
back to PayPal each time.

They certainly have trust and customer service issues -- and I've never
allowed more than a few thousand to accumulate in the account for that reason
-- but I have to admit I've only had technical problems with maybe 2-3
payments over those 9 years, never had my account locked, and generally just
benefited from the flexibility and good rates.

My impression is that _overall_ , they still have a middling to good
reputation. Especially if they can fix the glaring problems remaining, I don't
think they'll have any trouble staying strong for a long time.

~~~
chris_wot
Uh, you consider them to be something of a necessity, but you try to keep as
little money as possible in the account because you fear your account will be
frozen. I'd not say that they have "a middling to good reputation" - I'd say
if that's what someone who speaks of them well thinks, that's an _appalling_
reputation!

------
mcherm
Here is what _I_ would do... I would take him up on his offer (personal
attention from the CEO? Sure!), but I would ask him whether he'd be willing to
pick 3 or 4 other customers who had _NOT_ written an article which had gone
viral and offer THEM the same deal.

I want this to be true. I want PayPal to believe that this behavior is harmful
to their business and to push (at ALL levels of the company) to change how
they treat their customers. But I won't give them the benefit of the doubt
based on one message from the CEO. They burned their second chances long ago,
and it's much harder to regain my trust after losing it. I hope that they do.

~~~
maratd
Ooh! Ooh! Pick me! Pick me! I had 20K removed from my account without an
explanation and even hired a lawyer, all of which went absolutely nowhere.

This is all a bunch of baloney. If PayPal was really _serious_ about fixing
all the pain and misery they caused, they would create a direct line of
communication where those on the other end were empowered to resolve _all_
problems ... instead of giving a curt "send us a letter".

Until PayPal starts working with their customers and stops treating them like
criminals, I'll take my business elsewhere.

~~~
cpayne
"You now have my mobile number"

How much more direct communication do you want?

~~~
maratd
_I_ don't have his mobile number. What does that do for _me_ and for
_thousands_ of others who have been screwed over?

------
dmbaggett
From the skepticism here, it's clear Mr. Marcus has his work cut out for him.
Even with far fewer people ever reporting to me (directly and indirectly) than
him, I sympathize with his inability to get the unvarnished truth from his own
people. "We're routinely screwing people out of hard cash" is probably a scary
message to relay up.

His email sounded sincere, and he's new to the job. I'd be inclined to give
him the benefit of the doubt. He must know that the technorati hating his
company is bad for business.

~~~
chris_wot
They have their work cut out for them indeed, but it's of there own making.
They should have been looking at systemic issues when the Minecraft founder
couldn't get access to his account for months, when their customer service
advised someone to destroy a perfectly good violin due to "fraud", apparently
mass payment doesn't exist even when it does [1], numerous reviews in
magazines such as PC World [2] and Kernel Magazine [3], and an entire website
devoted to how bad they are was established from pissed off customers [4].

PayPal are in big trouble. It's going to take more than platitudes to get them
out of it!

1\. [http://christianowens.com/post/15771850658/my-recent-
experie...](http://christianowens.com/post/15771850658/my-recent-experience-
with-paypal-customer-service)

2\.
[http://www.pcworld.com/article/101525/consumer_alert_paypals...](http://www.pcworld.com/article/101525/consumer_alert_paypals_problems.html)

3\. [http://www.kernelmag.com/comment/column/2978/paypal-still-
su...](http://www.kernelmag.com/comment/column/2978/paypal-still-sucks/)

4\. <http://www.paypalsucks.com/>

~~~
tobyjsullivan
In all fairness, they have a new CEO. Maybe that is their way of looking into
systematic issues...

~~~
stcredzero
_> Maybe that is their way of looking into systematic issues..._

If true, they are doomed! New leadership is the Hail Mary toss, not the way
you solve problems.

~~~
fragsworth
It worked for Apple

~~~
stcredzero
Yes, that was a Hail Mary toss that worked. The question is, is the new guy of
Steve Jobs caliber, or is it a shyster who can only sell himself as such? (I
hope he is.)

The new guy is the desperation move, not the way an organization should solve
problems on a regular basis.

------
dkulchenko
Here's the context for those curious: [http://storify.com/goodonpaper/how-
twitter-rescued-me-from-p...](http://storify.com/goodonpaper/how-twitter-
rescued-me-from-paypal-hell)

------
njloof
Step one for PayPal would be to _always provide a reason_ when they take
action, _for all users._ Every bad experience I have had with PayPal began
with them doing something negative, and _never explaining why they did it._ I
have had methods of payment locked out, I have had funds not released, I have
been told I could not make an instant payment, and _not once_ was I given a
reason why.

~~~
ig1
Try asking your regular bank how their fraud detection works, or your
insurance company, or the secret service.

Basically if you work in fraud detection (or broadly any kind of crime
detection) you keep your techniques secret because otherwise you're helping
the criminals avoid you.

Look at the source code for Reddit or Hacker News, notice how in the publicly
released codebases they've both chosen specifically not to publish the code to
do with vote-rigging detection.

There's a strong argument for secrecy.

~~~
vadiml
The security by obscurity approach usually give you only an ILLUSION of
security

~~~
jasonlotito
Security has nothing to do with fraud. And in combating fraud, obscurity
works. SSL is security, but it's meaningless if the site you just sent your CC
data to is fraudulent.

Then, you need to understand how open PayPal is to fraud. I can easily commit
major crimes using PayPal, and security has nothing to do with it.

This is the challenge they face. If you think it's an easy problem to solve,
ask yourself: why is there no one else out there doing this same thing? Why
are all the other supposed opponents limited in such drastic ways that PayPal
is not?

I'm not suggesting they are perfect, but your trite remark is meaningless and
ignorant of the realities of the system.

------
UnoriginalGuy
Why now? Why with this story?

I've been reading similar complaints to that for years. Some of which were far
worse in my view (i.e. taking money out of banks to repay people who weren't
even seeking a refund because PayPal changed its mind about someone's product
or service).

Why does PayPal suddenly care? Is it because there is viable competition now?

~~~
sw007
Classic case of someone who just can't win whatever he does. People have been
crying out for PayPal to change - he notices this, he emails the guy with a
first class email but still gets criticised. Criticise him if he doesn't act,
don't criticise the guy for being big enough to say 'hey, we have a problem, I
want to fix it' - that should be applauded, even if it's come later than
people would have liked - at least it has come.

~~~
kmm
Oh come on. He can't "win" by solving one person's problems. Will he give his
personal email to everyone who has got his account frozen or large chunks of
money taken away by PayPal? I doubt it.

This is a non-solution, which is almost worse than doing nothing at all,
because it's active disingenuity.

~~~
wpietri
Did you read the same note I did? He says explicitly that he's new in the CEO
spot and would like to use this story as a tool for redoing how they handle
holds, and how they deal with customers.

You can't win by solving _just_ one person's problems. But you also can't win
unless you start by solving one person's problems. And then fix the system, so
that the kind of problem is less likely to recur.

This, IMHO, is exactly the right way to do it. As contrasted with the wrong
way, which is for employees to sit in their comfy offices and avoid all direct
contact with customers, making up bureaucratic solutions to imagined problems.

------
petercooper
If even a modicum of this attitude can seep down into all of the customer
facing departments at PayPal, it'd be an awesome thing. I hope they pull it
off.

~~~
ChuckMcM
Actually it would be 'life saving'. One of the reasons the payments space is
flourishing is because PayPal has been a poor service provider (creating
pain). And it has to come from the top, and you have to look into success
metrics carefully to insure the folks in your organization aren't doing more
harm than good to get 'good' ones.

------
notatoad
So bloggers with enough pull to get the CEO's attention will no longer have
their funds stolen by PayPal. Now how about the rest of us?

~~~
rm999
I realize you are being cynical, but the e-mail says the CEO wants to make
radical changes to fix issues for all customers. I'm a bit skeptical myself,
but if we take him for his word this isn't just for a subset of users.

~~~
protomyth
I think notatoad is being realistic. People with large audiences get things
fixed, they get the resources, and the rest of use get ignored. No one will
write an article about notatoad or protomyth getting hosed.

I hope Paypal can get it together, but I live in fear of getting hosed by them
without any recourse.

------
tlack
Great email.. one of the most convincing and sincere high level apologies I've
read. Perhaps, for once, the future is looking bright for Paypal. I could have
done without the "forwarded from my iPad" at the bottom though.

~~~
SerpentJoe
For what it's worth there are no occurrences of "sorry" or "apologize" in that
letter.

------
coryl
Perhaps one of the reasons PayPal is being more service conscious is they
finally have competition encroaching on their territory like Stripe + Square.

I guess its never too late to stop sucking though.

~~~
rishonik
> they finally have competition encroaching on their territory like Stripe +
> Square

And bitcoin. No matter how PayPal tries to put the kibosh on selling PayPal
for bitcoin, people will still find a way around it.

I no longer use PayPal after their first and only abuse of my account. They
had one chance and I found better solutions. That the CEO is sending out
emails to high PR value customers is a very telling move.

------
DigitalSea
While the CEO has only been onboard for 5 months now, these kind of issues
plaguing Paypal have been there for years now. I remember a good friend of
mine had his Paypal account frozen a few years back because they thought it
was suspicious he had received money so quickly (he was selling a popular
marketing eBook). After making him jump through hoops to get his money
(identification, financial records and scans of his passport, etc) he finally
received the cash 7 months later, by that stage he was ruined emotionally and
financially due to the fact it was his living (he couldn't pay bills or
anything).

While I applaud the new CEO wants to make amends, for some like my friend who
relied on Paypal to make a living by processing his business payments it's a
little too late. Although Paypal is still the industry leader (because they
have a stranglehold on online payments) the new CEO knows that offerings like
Stripe and whatnot are making Paypal less and less relevant each and every
day.

I would love to see Paypal change, the first thing they need to do is fire all
of their customer service staff and train new staff with a new set of
guidelines, implement a clean-cut way of contacting Paypal if something goes
wrong and clean their act up.

------
propercoil
In the previous post David replied to the comment (on HN) i made about wanting
to change paypal's generic template to increase sales through a/b testing.I
had a rant about paypal's api suckness and i also ranted about how draconian
the fund freezes of diaspora and wikileaks were.

He said that he understands and told me to send him an email and we will take
care of it. No email was sent yet as i'm afraid i'll be targeted in the
future. I can't put my legitimate digital business at that risk - there are
tonnage upon tonnage of forum threads over the web of people's business going
under because of pp freezes only because they contacted paypal it's heart
breaking and too much of a red flag to me.

The only thing i can say about David is that he looks and sounds like a
genuine guy who replied and started a discussion with the community and that
as we all know goes a long way. So maybe his intentions are good but will
paypal have zappos's culture regarding merchants all of a sudden? i doubt it
and you all doubt it too because what matters is implementation ie real life.

------
philhippus
Credit where it's due: out of all the _hundreds_ of Paypal horror stories,
this is the first time I have ever seen a reasonable, let alone personable,
response come from that nebulous digital beast.

Fair play to the new CEO, he has won back one notch of respect and hopefully
averted the slow motion train wreck that had probably already started at
Paypal.

------
appleflaxen
It's fantastic to see PayPal finally paying attention to these kinds of
nightmare stories, but it's hard to believe it has anything to do with
altruism.

They are seeing Stripe, Square, etc getting way more mindshare, and they are
scared.

With all due respect PayPal, good riddance. You've sucked too hard for too
long, and now we finally have alternatives.

------
skennedy
Why now? Why this situation is it finally hitting home?

What confuses me is that David acts as if these are new stories of accounts
frozen, staggered access to money, and blocked recourse to customer
chargebacks. This has been happening for years with hundreds of publicly
written stories of bad will by PayPal.

~~~
comex
The email mentions that this CEO took over only five months ago.

------
switch007
Media storm brews, someone high up responds and resolves issue. Nothing new.
It'd have been news if a random support person did the right thing.

------
hollerith
Posting screenshots of text instead of text make me sad.

It excludes visually-challenged people from this discussion, makes old people
get out their glasses and squint, and makes cutting and pasting impossible.

~~~
RobotCaleb
Not to mention random emails about stuff with no attached context.

------
ars
The CEO also posted a reply to the original story here:
<http://news.ycombinator.com/item?id=4485627>

<http://news.ycombinator.com/user?id=davidmarcus>

------
keithvan
Why does it take a story to make it to front page Hacker News to get
attention, to get a "direct channel" to the executives when things go wrong?
It ignores the all the horrible complaints and stories from everybody else.
It's inequity in itself when the only way you will get attention from big
companies is from making posts on Hacker News.

Why are they not paying attention to their other day-to-day customers? What
kind of business do you intend on building?

------
runako
Requiring personal supervision from an executive to withdraw funds is a
negative against PayPal, because the president isn't going to personally
supervise every account).

It's good that this executive (President, not the CEO as indicated in the
title) is taking initiative to fix things at PayPal. But until things are
fixed, PayPal is still a business risk.

~~~
jseliger
_Requiring personal supervision from an executive to withdraw funds is a
negative against PayPal, because the president isn't going to personally
supervise every account)._

True, but as you note in the second paragraph, this is still a major
improvement. I stopped using Paypal a long time ago because of an utterly
typical story:
[https://jseliger.wordpress.com/2011/12/09/december-2011-link...](https://jseliger.wordpress.com/2011/12/09/december-2011-links-
paypals-bogusness-ribbed-tees-literary-friendships-literary-research-alex-
tabarroks-new-book-and-more/) and have been encouraging other people not to
use Paypal ever since.

It's almost impossible for Paypal to be worse than it is, and it might even
get better.

------
d0m
Seriously, fuck them. They're starting to act like they care because there are
new competitors who've shown how it's supposed to be done. Sorry but not for
me, Stripe is my new paypal.

------
SquareWave
Dear Andy , After the many years of Paypal receiving stories just like yours
I'm forced to take action. The traditional Paypal long term strategy of
"Hahaha, where else are you going to go for online payments?" is not a viable
option anymore.

It's unfortunate that your story has spread so far and so quickly. I now have
to figure out how to resolve this AND try to figure out how anyone let it get
this bad. Changing such entreched culture here is going to be hard.

I'm going to do my best of not letting Paypal become more of a cliche of how
big businesses get their foundations kicked out from under them by smaller,
scarappy startups.

P.S. Please,please, please don't google Stripe.

------
heeton
That kind of behaviour from a CEO is not seen enough. Good on him!

------
j45
The day Paypal blinked?

I just was sent my first Paypal survey that I can ever remember about what
else I'm using or wanting to use

------
macarthy12
I think this represents a stay of execution for PayPal. I bashed them in the
past, but maybe there is some hope.

------
antonioevans
I hope this is a view of the transparency we'll be seeing in the future from
all levels of the org.

------
Apocryphon
I've always wanted to have a spreadsheet or something to keep track of the "HN
effect" in which companies respond to public outrages because of their
publication here. Though of course they might also get attention from Reddit
and other online outlets as well.

------
tsieling
Nice gesture, but how many people are going to have the same reach in their
complaints? It would be nitpicking to say the email fails the corporate
sociopath-speak test with 'leverage the issues', but what irks me is asking
for the help of someone your company has just offended. The frame of mind of a
non-sociopath would be to say 'how can I help earn back your trust?'.

I've given up on PayPal for my meagre needs, but anyone with real money on the
line should beat a path from them until their actions truly speak louder than
their words. Speaking of words, I noticed a TOS update from them but haven't
read it yet, so if they have taken positive steps then add grains of salt to
this comment, to taste.

------
robbeezy
The most effective way to show displeasure with a business is to stop being a
customer. Period. You can't blame the CEO here - he's simply trying to stop
the bleeding before Hacker News reopens it with a machete.

I've briefly worked for a payment processor - and I'm not overstating here -
but this industry doesn't give 1/2 a s __t about your feelings of them, their
customer service, or what you think of their CEOs. They only care about
getting as much money as possible. Period.

Peteris, keep posting of your experience and let's see if the CEO follows
through. If he doesn't he'll lose twice as much respect and twice as many
customers. If he does, then know you got some very expensive customer service,
my friend.

------
a-priori
PayPal is starting to feel the pressure of all these new payment startups (eg.
Square, Stripe) springing up around them. They know that if they're not
careful with their brand image they're going to quickly lose their lunch in
the next few years.

------
perlgeek
To all the naysayers out there: in your opinion, what could the CEO have
written to convince you? He doesn't have the option to go back in time to
change what happened, only to respond.

If I'd receive such an email, I'd give 'em a second chance.

~~~
chris_wot
I wonder if they cleared thir backlog of 100,000 complaints from 2002? [1]
Seriously, PayPal has had the same atrocious customer service now for well
over a _decade_ now, one email from a new CEO means exactly nothing in the
grand scheme of things.

1\. <http://pub.bna.com/eclr/021227.htm>

------
jongraehl
What the CEO is doing is effective. He's signaling that he really wants to fix
things and won't make excuses.

I doubt the CEO will learn much he didn't already know by a "direct line" case
study, but humbling himself in this way might give him the lever he needs to
really move company culture.

PayPal can keep most of its anti-fraud effectiveness while improving customer
service for those innocents who want to recover from misclassification. Either
being more trusting, or spending more effort discerning who can be trusted,
will cost them money short term. But if they don't do it, they'll lose some of
their customers to competitors who will.

------
niketdesai
I think we should make judgement on the outcome rather than the email (since
it's basically speculation anyways). Judge: Do these types of problems happen
in the same amount and severity in 6 months? (or whatever time horizon you
think is agreeable to see significant progress).

And there shouldn't be mockery for him fixing one account. Sure there are many
to go, but before this account was in the same boat...so it's an improvement
no matter how small. Whatever Andy said in his post really resonated to D.
Marcus; now I hope it really is the catalyst for PayPal to improve.

edited shortened it up.

------
lobster45
Back in 2006 someone hacked my paypal account and used my credit card that was
attached to paypal to purchase a few ipods. The criminal had them sent to
their home address. They also changed my paypal password so I was not able to
login. I contacted paypal support and they were absolutely not willing to help
even. It was terrible customer service. I have never used paypal since.

------
geuis
To everyone, on both sides, that feel this is just a stunt or a sign of real
change, just give it time.

Either things get better at Paypal, or they don't. Yes, big lumbering
companies can change for the better. Microsoft, IBM, and Apple come to mind.
Yahoo may be on that road now too. But it takes time to see. The wheels of
change move slowly.

------
treskot
Reminds me of the proverb "do good nd cast into the river". If you want the
world to know about it I would simply consider it a PR stunt. Maybe the Paypal
CEO had a positive intent and the Marketing team / PR team wanted to brag
about it to the entire world. That's how the corporate world is though!

------
rhizome
Talk is cheap, PayPal.

------
ck2
Now he needs to write the other 100k innocent people PayPal has completely
screwed with.

------
catfish
A single email does not change a process nor a corporate culture of
indifference.

------
mmanfrin
Context?

~~~
dchest
<http://news.ycombinator.com/item?id=4483710>

[http://allthingsd.com/20120907/paypals-new-president-
faces-t...](http://allthingsd.com/20120907/paypals-new-president-faces-the-
music-if-we-suck-we-now-face-it/)

------
redm
One wronged customer down; thousands more, including myself, to go.

------
webjunkie
Wow, just wow. If it's real. If he really means it. But still.

------
miffydiffy
Screenshots are more confident than copy&paste of text.

------
emilysviolins
I hate hate hate PayPal. They ruined my ebay business!

------
dzhiurgis
Link is down. Mirror / backup anyone?

------
marginalboy
That's classy.

------
j2kun
"Sent from my iPad." Nice.

------
lyime
Legit.

------
lordastral
Okay which one of you hacked the Paypal CEO's account?

------
ydvj
his name is david marcus. isn't this the same guy who cheated and used
protomatter in Project Genesis?

~~~
zaidmo
And his mum is Carol Marcus? Kirk's son!

