# PayPal Honey

Honey Science Corporation, doing business as PayPal Honey (previously Honey), is an American technology company and a subsidiary of PayPal. It is known for developing a browser extension that automatically applies online coupons on e-commerce websites. Founded in 2012 by Ryan Hudson and George Ruan in Los Angeles, California, the company was acquired by PayPal in 2020 for approximately $4 billion. The company has come under scrutiny for allegedly overriding affiliate links and using misleading advertising.

## History

Entrepreneurs Ryan Hudson and George Ruan founded Honey in November 2012 in Los Angeles, California, after building a prototype of the browser extension in late October 2012. A bug tester leaked the prototype to Reddit, where it gained adoption. By March 2014, the company had 900,000 organic users.
Honey raised a $26 million Series C round, led by Anthos Capital in March 2017. By January 2018, Honey had raised a total of $40.8 million in venture backing. In 2020, it was acquired by PayPal for about $4 billion, after which Honey became part of PayPal's rewards program.
In December 2019, Amazon claimed to its users that the extension was a security risk that sold personal information. A Wired magazine article, written shortly after the acquisition, questioned whether the claim was motivated by PayPal's newly acquired ability to compete against Amazon.
In 2020, the Better Business Bureau started an inquiry to investigate a Honey advertisement claiming: "With just a single click, Honey will find every working code on the internet and apply the best one to your cart". Honey told the BBB that it was already taking steps to discontinue the ad, and after agreeing to a permanent discontinuation, the inquiry was closed.
In 2022, the company's trade name was changed to PayPal Honey.

## Marketing

PayPal Honey has become known for its heavy use of YouTube advertising and channel sponsorships for its marketing. Similarly to NordVPN, Amazon's Audible, Opera, Hello Fresh, Genshin Impact, War Thunder, Raycon, G Fuel, Dollar Shave Club, Surfshark, and Raid: Shadow Legends, it offers paid sponsorships to popular YouTube channels to advertise the service to their viewers.
Starting in the 2019–20 NBA season, Honey became a practice jersey sponsor for the Los Angeles Clippers, a sponsorship that would later expand into game jerseys in the 2020–21 NBA season. The jersey sponsorship ended following the 2022–23 NBA season.

## Operations

PayPal Honey operates a browser extension that automatically applies coupons on e-commerce websites. The company has claimed that the extension aggregates these coupons across the internet. Honey's revenue comes from a commission made on user transactions with partner retailers. When a user makes a purchase from merchants partnering with the company, Honey provides Honey Gold points, which can be then redeemed at partnering stores to get additional coupons and offers. Other features of the browser extension include a feature called Droplist where a user can add an item to a list and be notified when the price of the item drops across partnered retailers and a feature called Amazon Badge, which compares prices of a product across multiple resellers on Amazon, presenting users the ability to switch to a cheaper reseller during buying a product.

## Allegations of overriding affiliate links

In December 2024, YouTuber MegaLag released a video alleging that the Honey browser extension re-attributes sales made through affiliate marketing programs by modifying affiliate links at checkout, crediting Honey with the sales even if it did not find a coupon to use, which is a type of cookie stuffing. He also stated that the extension grants partnered vendors control over which discount codes are presented to users. Furthermore, he claimed that Honey would intentionally exclude more favorable discount codes, displaying only coupon codes approved by the merchant stores that were partnered with the Honey Partner program.
In a statement to The Verge, PayPal said that "Honey follows industry rules and practices, including last-click attribution." Ray Fernandez of Techopedia stated that Honey's interfering with the checkout process and "deliberately [removing] all traces of the original links that led users to a product and [replacing] them with its own affiliate ID" is not an industry standard. Another PayPal statement made to USA Today said that merchants decide what coupons are offered through Honey.
On December 29, 2024, a class action lawsuit against PayPal was filed in United States federal court by three law firms, including one owned by YouTuber LegalEagle, over the affiliate marketing controversy. The suit claims intentional interference with contract relations and prospective economic relations, unjust enrichment, conversion, and violation of California's Unfair Competition Law. Sam Denby of Wendover Productions and Ali Spagnola were named as plaintiffs. The controversy gained further traction when another class action lawsuit was filed on January 3, 2025, by the technology review outlet GamersNexus through law firm Cotchett, Pitre & McCarthy, LLP, claiming conversion, interference with contract relations, and violation of North Carolina's Unfair and Deceptive Trade Practices Act.
Honey has since lost 3 million users as a result of the controversy. In March 2025, Google updated their extension terms and conditions. Google's new terms and conditions explicitly disallow extensions that claim affiliate commissions without providing discounts. Subsequently, Honey updated their extension to stop claiming affiliate revenue in cases where they are not able to provide a discount.