X.com

» see x.com as it lived, on the wayback machine

~ the goodbye ~

In December 1999 I was fifteen, in Turkey, on a modem that had recently been upgraded to 33.6k. An American checking account with no branch and a twenty dollar signup bonus was not something I could reach or evaluate. I read about the dot-com years the way you read about weather in another country.

X.com launched on 7 December 1999 out of Palo Alto. Elon Musk had founded it that year with Harris Fricker, and Christopher Payne and Ed Ho were on the founding team alongside them. Musk put in most of the money himself out of the sale of Zip2. The idea was a single financial website that would hold your checking account and would also send money to another person by email address, which in 1999 required two separate industries to cooperate and neither of them wanted to.

To make the deposits legitimate the company bought First Western National Bank of La Jara, Colorado, a small institution whose value to a Palo Alto startup was its federal deposit insurance. Three investment funds sat alongside the account. The growth was bought outright: twenty dollars for opening one, ten more for every person you brought in. A hundred thousand customers signed up in the first two months.

Then Confinity, a Palo Alto neighbor working the same problem, turned out to be doing the payments half better than X.com was.

The rest of the story belongs to a company that no longer carried this name. What is worth keeping about X.com is that for eighteen months somebody made a serious attempt to build an internet bank starting from the account, and the market reached in, took the email payments feature out of it, and threw the bank away.

~ the chronicle ~

~ the twenty dollars ~

Paying people to open an account looks reckless now and looked reckless then. It also worked, and it is why the customer numbers moved as fast as they did. The referral bonus mattered more than the signup one: ten dollars a head meant every account holder had a reason to go and find the next one, and the growth compounded without advertising doing any of the work.

Confinity was running the same play on eBay, handing new PayPal users a bonus and letting auction sellers pull their buyers across. By early 2000 both companies were paying for the same customers on the same platform. That is a race with an obvious ending and a very expensive middle.

~ the merger and the coup ~

The two merged in March 2000 and kept the X.com name. Musk stayed chief executive. In September 2000, while he was out of the country, the board voted him out and put Peter Thiel in the job.

The disagreement underneath it was partly about infrastructure and partly about the name. Musk wanted X.com to be the brand. The research kept coming back saying that people who saw an address like that assumed pornography. In October 2000 the banking plan was abandoned and First Western was let go, which left the payments product standing on its own. In June 2001 the company took that product's name and became PayPal. eBay bought it in October 2002 for about $1.5 billion.

~ the name ~

The domain then sat unused inside PayPal for sixteen years. Musk bought it back in July 2017, saying it had sentimental value. In 2023 it became the address of the site formerly called Twitter.

So the name is alive and the thing is dead, which is a shape this graveyard runs into often. The company that launched on 7 December 1999 was an online bank in Palo Alto with a Colorado charter and a twenty dollar bribe at the door, and it was gone inside two years. Nothing answering at that address today has any relationship to it beyond one person's long attachment to a letter.

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