From PayPal to Palantir: What Peter Thiel's Track Record Means for Patient Shareholders Today

PayPal (NASDAQ: PYPL) and Palantir (NASDAQ: PLTR) might not seem to have many characteristics in common. PayPal is one of the world's largest digital payment companies, while Palantir is a data mining and AI company that serves government agencies and commercial customers. Over the past five years, PayPal's stock plunged 80% as its growth cooled -- but Palantir's stock skyrocketed more than 530% as its growth accelerated.

Yet both companies were co-founded by Peter Thiel, one of Silicon Valley's most prominent investors. Let's look back at Thiel's involvement in these two companies, how much he profited from those stakes, and what his track record might mean for long-term investors.

Image source: PayPal.

Thiel's track record with PayPal

Peter Thiel, Max Levchin, and Luke Nosek co-founded Fieldlink in 1998. Fieldlink subsequently became Cofinity, a developer of security software for handheld devices, before launching its first version of PayPal's digital wallet in 1999.

Thiel invested about $100,000 in the original company before it evolved into PayPal, giving him a cost basis of nearly zero. He sold his 3.7% stake for $55 million after eBay (NASDAQ: EBAY) acquired PayPal for $1.5 billion shortly after its 2002 IPO. After accounting for eBay's 2015 spin-off of PayPal (which gave eBay's investors equal shares in both companies), Thiel's original stake would be worth billions of dollars today.

Thiel left a lot of money on the table, but it isn't unusual for founders to sell their stakes in successful start-ups after they go public or get acquired. In fact, none of PayPal's founders still holds a meaningful stake in the company today.

Thiel's track record with Palantir

Peter Thiel co-founded Palantir with Stephen Cohen, Joe Lonsdale, Alex Karp, and Nathan Gettings in 2003. Thiel invested approximately $30 million (from his own pockets and his Founders Capital venture capital fund) in the company.

Before Palantir went public via a direct listing in 2020, Thiel owned 7%-10% of its private shares. He sold millions of shares after Palantir's market debut, but he still holds a 3% stake and remains the company's chairman. That stake is worth more than $10 billion today.

Thiel's decision to stick with Palantir while selling PayPal might suggest he's more confident in the former's long-term growth potential. However, it could also mean that Thiel doesn't want to miss out on some massive gains, as he did with PayPal.

What do Thiel's actions mean for long-term investors?

Thiel's investing track record with PayPal and Palantir is open to interpretation, but it ultimately doesn't mean much to retail investors. Instead of wondering why Thiel sold PayPal so early or why he's still bullish on Palantir, investors should simply see which is the better buy.

Over the past few years, PayPal has struggled to gain new accounts (which only rose from 435 million in 2022 to 439 million in 2025) and stabilize its declining take rates. That sluggish growth was caused by intense competition from other payment platforms, macroeconomic headwinds affecting consumer spending, and the loss of eBay as its top e-commerce partner.

From 2025 to 2028, analysts expect PayPal's revenue and EPS to grow at CAGRs of 4% and 6%, respectively. It isn't headed off a cliff, but its high-growth days are clearly over.

Palantir grew much faster than PayPal as its Gotham platform won more government contracts and its Foundry platform locked in more enterprise customers. Those clients use its tools to crunch data from disparate sources to track individuals, spot trends, and make predictions.

From 2025 to 2028, analysts expect Palantir's revenue and EPS to increase at CAGRs of 49% and 54%, respectively. That explosive acceleration -- which makes it one of the market's fastest-growing tech stocks -- should be driven by the ongoing geopolitical conflicts and increased enterprise spending in data mining and AI tools.

Which stock is a better buy right now?

PayPal's stock looks cheap at less than 10 times this year's earnings, but it might deserve that discount valuation. Palantir's stock looks much pricier at 126 times this year's earnings, but its accelerating sales growth and soaring profits could justify that premium valuation.

Palantir's stock might be a bit too hot to handle in this wobbly market, but it looks like a better long-term investment than PayPal. Therefore, it makes sense for retail investors to follow Thiel's lead and focus on Palantir's growth instead of PayPal's messy turnaround efforts.

Leo Sun has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Palantir Technologies, PayPal, and eBay. The Motley Fool recommends the following options: short June 2026 $50 calls on PayPal. The Motley Fool has a disclosure policy.