CNET también está disponible en español.

Ir a español

Don't show this again

Tech Industry

X.com raises $100 million

The payment service will announce tomorrow it has raised $100 million, fueling the growth of financial services that let people pay each other easily online.

Payment service X.com will announce tomorrow it has raised $100 million, fueling the growth of financial services that let people pay each other easily online.

The Palo Alto, Calif.-based company received third-round investments from Madison Dearborn Partners and Capital Research Group, as well as from previous investors Sequoia Capital, Goldman Sachs and idealab Capital Partners, among others. The company said it plans use the funds to expand overseas and launch services for wireless devices later this year.

The company, which recently merged with rival PayPal.com, specializes in free payment services for online auctions and community sites, areas greatly in need of making purchases simple and safe for consumers. Many Net and traditional companies are competing to offer such services so that people can send money instantly without the hassle of sending checks or the cost of accepting credit cards.

Last month, eBay partnered with Wells Fargo to develop an online person-to-person payment system, combining its Billpoint service with Wells Fargo's banking prowess.

X.com said its service is "a combination of Western Union, plus Visa, plus Citigroup." More than 750,000 auctioneers on eBay encourage buyers to use the PayPal.com service vs. the 20,000 that endorse Billpoint, it said.

X.com is attractive to investors because it catches on easily with Web users.

"It has viral growth effect because as one user wants to pay a friend they can encourage another to sign up," company founder Elon Musk said.

"The bigger our user base gets the more valuable our network becomes--this is what gets our investors excited about us."

Singapore-based Temasek and Vertex; Japan-based Compass Partners and Hikari Tsushin; and TAMC of Taiwan participated in the round of funding; as well as LabMorgan, Digital Century Capital and Robertson Stephens.