Honey is primarily known as a browser extension that scours the web for coupons and discounts.Those are applied whenever a user checks out at one of its 30,000+ partner merchants.
Honey was founded in 2012 by George Ruan and Ryan Hudson. They had previously exited other businesses and, therefore, put up $50,000 each to get the first prototype developed.
In November 2019, PayPal announced that it would acquire Honey for $4 billion. It has since leveraged its association with PayPal to close partnerships with renowned brands such as Sephora.
Honey makes money by receiving a commission from the merchants that it works together with. That commission is paid whenever a customer makes a purchase using Honey at checkout.
Merchants are incentivized to work together with Honey because it significantly increases the likelihood of a sale (due to the discounts provided at checkout).
Additionally, Honey has introduced a variety of tools, such as Droplist, which increase touchpoints with customers – and thus up the likelihood of a sale.