David and Tom Gardner recently interviewed eBay CEO Meg Whitman on The Motley Fool Radio Show on NPR. This is the first of five parts.
TMF: Meg Whitman is the CEO of eBay
Whitman: Thanks.
TMF: Meg, a couple of years ago, you publicly stated a five-year sales growth outlook of 50% a year. You were calling for $3 billion in sales by 2005, I think it was. How is that looking and would you like to make news with any other predictions on the show?
Whitman: We feel real good about $3 billion in revenue in 2005. You will recall that was without PayPal. So that is just eBay and we feel very good about that. The trajectory is strong. Business is good and so we are standing by that one.
TMF: We want to give you an opportunity to speak to our listeners who are on the Internet but have not yet used eBay, perhaps don't even understand what the service is. I know those people exist, as popular as eBay has become. Take a minute or so to explain what eBay's services are, why they are unique, and why you think they are relevant to people.
Whitman: Well, eBay is the largest online marketplace where millions of buyers and sellers come together every day to do business. So if you are looking for everything from a surfboard to a skateboard to clothing and accessories to fishing equipment, come to eBay and you will find millions of sellers who offer goods in a huge array of breadths that goes from higher prices to lower prices, branded products and unbranded products, new products to used products and you can find a great deal and also find very-difficult-to-find items. So think about it as a very large virtual marketplace on a global basis.
TMF: Now within that marketplace over the years there have been some pretty remarkable stories about sellers on eBay. Are there one or two or three that stand out in your mind of incredibly unique and perhaps very profitable endeavors by an individual or group of people selling on eBay?
Whitman: Sure. We think we have about 150,000 people in small businesses who make their living selling full-time on eBay. So it is actually one of the best places to start a new business, either in the United States or in any of the countries in which we operate. So by definition there are fabulous stories about sellers who have gone from doing business just on the nights and weekends to quitting their day job and selling full-time.
We just had a conference down in Orlando called eBay Live where 10,000 eBayers arrived on the scene to sort of share stories and talk about their success on eBay and also give us feedback about what we could do differently.
TMF: How is eBay different today than it was three years ago?
Whitman: Well, it is a much broader trading platform. We now operate in 27 countries outside of the United States. There are well over 5,000 employees. The site is handling traffic that is many, many times bigger than it was three years ago, whether you look at page views or gigabytes about band traffic. We now have 30,000 subcategories on the site. So just about anything you are looking for you can now find on eBay.
TMF: Meg, you just mentioned PayPal, the online payment back-end company that eBay recently acquired. It was actually one of those selections I made in our Motley Fool Stock Advisor newsletter so now you have some Motley Fools who are into eBay as well thanks to your buying PayPal. How has the integration of PayPal gone?
Whitman: You know, it has gone really well and credit to Matt Bannick, who runs the PayPal organization for us and all the PayPal folks who really helped to make this a success. This is not easy, putting together two companies -- two different cultures -- and I think the planning paid off. It has worked really well. Integrations always work well when the financial results are good. That always helps people. By integrating PayPal more deeply into the eBay platform, pick-up business has accelerated and I think people on both the eBay side as well as the PayPal side feel real good about that.
TMF: Can you just in a couple of sentences explain the strategy? Why buy PayPal?
Whitman: Well, PayPal was in many ways the standard for buyers and sellers paying each other on eBay before we acquired the company. In fact, in over 50% of eBay.com listings, the sellers offered PayPal. That is because PayPal was and is an incredibly easy-to-use mechanism for relatively small dollar transactions from an individual to a small business or an individual to an individual. So it enabled people like me to be able to accept a credit card when I put things up for sale on eBay or accept money from one PayPal account to another PayPal account.
Tomorrow: Google as a competitor.
