A future where machines do our shopping for us will put fintech centre stage

You may not have heard of Braintree, but you've almost certainly heard of their customers – Airbnb, Uber, Pinterest and LivingSocial.

Braintree provides credit card transactions and payment services for these companies. Simply put, it’s a payments platform.

In 2007 shop manager Bryan Johnson quit his job at US department store Sears, to set up Braintree. Within two years, he was making a million a year.

On September 20th, 2013, Braintree announced it was processing $12 billion annually, with $4 billion of that total on mobile. Six days later, the company was acquired by PayPal for $800 million.

John Lunn was on the PayPal team that oversaw the acquisition. Lunn, who is a senior global director at PayPal and Braintree, said the move followed PayPal's desire to be the payments platform of choice for developers.

Back in 2013, PayPal had its own mobile apps, and was processing plenty of mobile payments, but its developer tools were stuck in the past.

In March of that year, the company set out to build a new PayPal for developers, with new APIs and a new website. However, Braintree and competitors like Stripe were one step ahead, always launching more sophisticated products.

“A year or two before, I was asked to look at revamping the relationship between PayPal and developers. I redid all the APIs. Then I went out to talk to the developers,” Lunn says.

“We were growing fast but not fast enough. We wanted to be the best, so we bought the best.”

Skinny e-wallets

He says commerce is worth $25 trillion globally, and that ecommerce makes up only 10 per cent of that, and e-wallets account for just 1 per cent.

“A massive amount of the industry is still up for grabs. Fintech is where the good stuff is happening.”

Lunn says everybody expected payments to become a commodity but they haven’t.

“People want a beautiful ecommerce experience. They don’t want to fill out lots of forms to pay for things.”

He says Uber is the king of easy payments. When people arrive at their destination, they just get out of the car, and payment is automatically debited from their credit card. Uber users don’t have to click anything on an app, or approve the purchase.

“It’s no-tap purchasing. Once your cab arrives, you get out. You’ve already paid. It’s clever as no one enjoys paying for things, or being asked for money.”

He says the next step is that machines will start buying things for us.

Machine as customer

“Everything being built at the moment involves us interacting with a machine. We won’t have to that in the future. For example, a light bulb will re-order itself before it blows out.”

He says much of the home automation developed over the past few years, lets us control things in our home. However, Lunn says these devices should make decisions for homeowners, especially dull decisions.

“Who enjoys shopping for toilet paper? No one. Why not just let a machine do that for you?”

He believes virtual reality and artificial intelligence will make big impacts next year, especially with regard to virtual reality shopping experiences.

In-context shopping is also a developing trend which is just going to get bigger. This involves shopping in some other context than the app or website of the seller, such as buying an item through Facebook or on Twitter.

Braintree is currently enabling in-context shopping on social bookmarking site Pinterest through “buyable pins”.

Braintree has also begun reaching out to start-ups more. The company launched Startup Blueprint, its programme that provides global mentorship and support for the start-up community, at Web Summit in 2013.

Lunn says the programme allows start-ups to process up to $1.5 million for free through PayPal and $100,000 for free through Braintree. “We have 1,400 start-ups in the programme. What I’m noticing is that everyone is building a marketplace. It is the internet of sharing or selling other people’s things.”