Max Levchin

Finding a good business partner may be a little tricky, but according to Max Levchin, co-founder of PayPal, it is one of the most important decisions you can make.

Max Levchin earned a bachelors degree in Computer Science from University of Illinois at Urbana-Champaign, where the first first Internet graphical browser, Mosaic was developed. This browser led to the boom of the 1990s and made the Web accessible to the ordinary person for the first time. Firefox 3, developed from this basic browser, had more than 8 million unique downloads the day it was released, setting a Guinness World Record.

After being influenced and taught at the same institution where Mosaic was created, Max decided to head for the Silicon Valley. Not intentionally looking for a business partner, Max randomly walked into a classroom on the Stanford University campus, trying to get out of the heat and searching for an air-conditioned place to sit.

He sat in on a lecture given by Peter Thiel. Peter Thiel’s expertise in business and entrepreneurship inspired Max to chat with him after class. The next day they met for breakfast and he shared with him several ideas he had for business projects. This meeting was the beginning of an extremely profitable business partnership.

They ended up creating a company called PayPal, an online payment processing company which allows people to send money to each other in a completely new and different way than they had ever been able to before. PayPal sold to eBay on July 8, 2002 for $1.5 billion dollars. Max’s share was worth $34 million and Peter Thiel’s share was worth $55 million.

One of the qualities of a good partnership is that the partner can tell you when your ideas are good and also when they are just way off base. The success of the partnership depends on you choosing the right person.

Some partnerships last a lifetime and end up being good for both parties, while others may last half a life time and end up with one or the other sending their partner down the river. Choose your business partner as wisely as you would choose a marriage partner.

There are many people who can be considered pioneers in the development of web technology and most seem to be millionaires or billionaires. Max Levchin is no exception. Who is he?

He is a thirty-five year old, computer scientist and entrepreneur. He was born in the Ukraine, and moved to Chicago, Illinois in 1991 under a political asylum. He earned his bachelors degree in computer science at the University of Illinois at Urbana-Champaign.

Accomplishments

In 1997 he co-founded two companies NetMeridian Software and SponsorNet New Media.

In 1998, he co-founded FieldLink with Peter Thiel and John Bernard Powers. Powers left the company and the company name, FieldLink, was soon changed to Confinity. The two partners, Levchin and Thiel then developed  the popular payment product known as PayPal. After merging with a company called X.com, the official name of their company was changed to Paypal Inc. Levchin was well known for developing the anti-fraud component of PayPal called CAPTCHA a process that will differentiate computer input from input by human beings.

PayPal went public in 2002, and shortly afterwards, eBay purchased PayPal for $1.5 billion dollars.  When PayPal was acquired by eBay, Levchin’s interest in the company was worth $34 million dollars.

Levchin did not remain idle after this aquisition. In 2004, he went on to create yet another company called Slide. He invested $7 million dollars of his own money in this company. Funding was also acquired from various venture capitalists. The company was first developed to allow users to organize photos on their computers and post them to personal blogs. Later it became known for creating applications that became very popular on Facebook. Some of the applications were “Top Friends”, FunWall”, “My Questions, “Fortune Cookie”, and “Super Poke”. By 2008, Super Poke Pet was launched were you can care for and buy things for a virtual pet.

On August 6, 2010, Google purchased Slide.com for $182 million dollars. Levchin received $39 million dollars for that sale. Shortly after that, on August 25, Google offered him a job as the Vice President of Engineering.

Advice To Entrepreneurs

Max Levchin’s best words of advice to other technology entrepreneurs is to try your best to find a good co-partner. Having the checks and balances from another person that you have respect and trust for and the ability of that person to tell you when you are way off base at exactly the right time is extremely valuable, if not the most valuable thing.

Future Plans

It will be exciting to follow his next accomplishments as a new Vice President of Engineering at Google.