ecommerce

eBay History in Short16 March 2010

Pierre Omidyar, who recently graduated with a degree in Computer Science and had started up his own company, was chatting with his girlfriend, a collector of Pez candy dispensers, about the difficulty of finding fellow Pez dispenser collectors she could trade with. Pierre, in his wisdom, got to work programming an online trading post. What he built would eventually evolve into eBay, the world's first online auction.

Or, at least, that's the corporate line the marketing boys came up with. It does make for a great story, and chances are there is a lot of truth to it, although certainly with a marketing twist. However, why Pierre started the online auction revolution isn't important. What's important is that it changed the World Wide Web, and the world, forever.

That first software program would eventually become AuctionWeb, the first online auction. Pierre would go on to be the first online auction seller after listing a non-working laser pointer which, astonishingly, sold for $15.

Initially, sellers were allowed to list items for free. But when supporting AuctionWeb's users became too overwhelming, Pierre decided to start charging 10 cents to list an item in the hopes it would thin out the herd. In fact, it did nothing to reduce the number of sellers. Instead, listings continued to grow. Rumor has it that some sellers would snail mail Pierre a dime taped to a postcard in order to pay for their listing.

Eventually the time to get some serious brains behind the brawn came. Jeff Skoll, a Stanford MBA, was brought on board in 1996. Later, Jim "Griff" Griffith, a struggling artist and regular helper at the user-supported AuctionWeb, received a call from Pierre and Jeff with an offer to become eBay's first customer support employee. That call, Jim would later recall, probably saved his life as he was in the midst of contemplating suicide when his phone rang.

AuctionWeb would later become eBay (which some say is a reference to Echo Bay, the name of Pierre's consulting firm at the time) and Harvard MBA and former Hasbro executive Meg Whitman would soon join the rapidly growing ship. Under Meg Whitman's leadership, eBay's growth was exponential. Early employees, thanks to stock options, became millionaires while executives became billionaires.

Employees weren't the only ones to strike it rich. The online auction giant became the platform that would support thousands of entrepreneurs who would make a full-time income, some of them hauling in six figures per month.

As with all things successful, several companies have tried to emulate eBay's incredible story of prosperity, with most of them falling by the wayside. Through it all, eBay remains the largest and most successful online auction, and still the #1 platform for beginning "netpreneurs" to get their start.

Stuart Lisonbee is a former eBay employee and PowerSeller. His free eBay eBook, Secrets of an eBay PowerSeller, helps entrepreneurs make money on eBay by teaching the strategies he used to sell over 10,000 items in 18 months using wholesalers and dropshippers.