Tipjoy Heads To The Deadpool
Tipjoy, a startup that allowed users to easily collect ‘tips’ from their readers and fans in the form of small Paypal transfers, is closing up shop. Earlier this evening Co-founder Ivan Kirigin posted a note to the Tipjoy blog announcing the site's shutdown.
Context & Ripple Effects
Tipjoy built its service on a thin wrapper: it let fans send small tips through [[a:/entity/paypal|PayPal]] and even turned tweets into payments, but it never owned the payment rail or the social graph it sat on. Its founder Ivan Kirigin confirmed the end on the company blog on August 21, 2009.
The shutdown slots into a familiar TechCrunch arc from this period — Edgeio went to the same Deadpool in December 2007, and money-transfer startup iKobo quit the following November (November 2008) — marking another early bet on lightweight consumer payments failing to find durable scale.
First-order effects
- Bloggers and creators using Tipjoy to collect reader tips lose their payment button immediately, with Kirigin's blog post serving as the wind-down notice.
- PayPal loses one of the small third-party services routing micro-transactions through its API, narrowing the ecosystem of startups building atop its rails.
Second-order effects
- Any successor in social tipping now has to justify its margin over simply directing fans straight to a PayPal address — the wrapper model gets priced at zero.
- Twitter-adjacent developers see the caution flag: monetization layers dependent on another platform's data and another processor's settlement have two masters and no moat.
Third-order effects
- If the pattern holds, standalone micropayment intermediaries get squeezed out of existence, leaving tipping economics to be absorbed natively by the platforms (social networks and processors) rather than by independent startups.
The trend: Consumer payment startups that merely wrap existing rails like PayPal keep dying in the Deadpool, pushing micropayments toward native integration by the platforms themselves.