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PayPal president leaves for Facebook

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PayPal president David Marcus is stepping down after two years to run mobile messaging at Facebook.Eric Piermont/AFP/Getty Images

PayPal president David Marcus is leaving for Facebook (FB) to run the social network’s mobile messaging products.

His departure, announced on Monday, is a huge loss for PayPal and its owner, eBay Inc. Since eBay bought it in 2002, PayPal has become the fastest-growing of the company’s main business units and accounted for 43% of eBay’s overall revenues last quarter.

In Marcus, Facebook gets a well-liked serial entrepreneur with management experience at a big tech company. For Marcus, it’s an opportunity to run one Facebook Messenger, a messaging service that has become one of the social network’s most heavily used products, with over 200 million users a month.

“I’m looking forward to getting my hands dirty again attempting to build something new and meaningful at scale,” Marcus wrote in a Facebook post.

Coincidence or not, the news of Marcus’s defection occurred the same day Facebook accidentally released Slingshot, an app that lets users trade, or “sling,” photos and videos. The catch: Users can only view what their friends sent provided they share something of their own. Slingshot is Facebook’s second attempt at capturing part of the younger messaging market following its failed Poke app, which launched in December 2012 to fanfare and quickly fell off app charts. It is trying to compete against Snapchat, a company that spurned a $3 billion Facebook buyout offer last year.

It’s unclear whether Marcus will also oversee Slingshot development, but it could benefit from his fast-moving approach. Although he was PayPal president for just two years, he restructured the business and emphasized product development. “I don’t remember any new products coming out of PayPal until Marcus,” Max Levchin, a serial entrepreneur who helped co-found PayPal, told Fortune

Marcus also reportedly mandated employee loyalty and spearheaded renovations of PayPal’s San Jose headquarters, tearing down offices to make room for an open environment that encouraged collaboration. He was bullish on digital currencies like Bitcoin, fueling eBay (EBAY) executive chatter that PayPal could eventually accept them alongside traditional credit. “It’s very well-designed,” Marcus told Fortune in May 2013. Indeed, PayPal could very well still embrace the likes of Bitcoin, but it will have to do so with a new leader.

David reinvigorated product design to deliver compelling consumer experiences and energized the team to make a great business better,” eBay CEO John Donahoe wrote in a blog post. Levchin said: “Having a real entrepreneur at the controls of the rocket ship that is PayPal visibly sped up innovation. I am sure the momentum of David’s presence will last for a while, but it’s a major loss for PayPal and a big win for Facebook.”

Related Video: Is PayPal doomed without David Marcus?