EBay Inc. Sells Equity Interest in Craigslist

http://www.ebayinc.com/node/7885

by prostoalex • 11 years ago

100 57 11 years ago

ebayinc.com

colinbartlett2• 11 years ago

I would really like to know what kind of return they made on their investment.

aresant• 11 years ago

They bought the stake for $12 - 15m in 2004 when CraigsList sales were estimated at $7m/yr (1)

Today CL's sales are estimated to be ~$335m and doubled year-over-year (2)

(1) http://www.sfgate.com/business/article/EBay-buys-25-stake-in...

(2) http://www.wsj.com/articles/ebay-sells-craigslist-stake-back...

smitherfield2• 11 years ago

Craigslist has no advertising on their site and doesn't charge for listings except for a few small sections of the site in major metropolitan areas (the funds from which they use for their business expenses). I think it speaks to the state of the bubble we're in that one of the "blue chip" internet companies has a business model of "be an ultra-speculative investment as long as possible." Of course Amazon too, but I'd say Craigslist is a more extreme example.

philip1209• 11 years ago

Along those lines - when/if are they are they required to disclose it as a publicly-traded company?

colinbartlett2• 11 years ago

I believe they are only required to disclose financials of it in their next quarterly update if the transaction has a "material" impact on the business. Which is open to a lot of interpretation but generally has come to mean that the information would have an impact on whether the average shareholder would buy or sell the stock.

This is why you see Apple buy dozens of companies quietly without disclosure all the time. Because most purchases would not really change whether the average person invests, if for no other reason than the sheer size of Apple.

kethinov• 11 years ago

I wonder if this deal is designed to make eBay an easier acquisition target for Amazon or Alibaba?

arielm• 11 years ago

Very likely considering they've also split out PayPal to make eBay more of a single-focus entity (read, easy to sell off).

ma2rten• 11 years ago

Craigslist has been in decline / shrinking for the last couple of years. I don't think it's a strong signal either way.

EDIT: see http://techcrunch.com/2015/04/10/as-vertical-marketplaces-ri...

pbreit2• 11 years ago

Highly doubt it. Getting rid of the legal uncertainty is minor plus but getting rid of a possibly 10 figure holding for much less than that is a large minus.

robryan• 11 years ago

eBay is also currently making product identifiers (UPC/EAN etc) compulsory, another step in a long line of steps to slowly turn themselves into something more like the amazon marketplace.

lips• 11 years ago

So is anyone going to recreate the ebay of yesteryear?

dredmorbius• 11 years ago

That would also explain the Kijiji-is-big-in-Canada submarines which have been appearing lately

fourstar• 11 years ago

Can someone please tell me why this matters?

greglindahl• 11 years ago

It's fairly safe to say that it doesn't. The price wasn't announced, and does anyone here really care if eBay was suing Craigslist and vice versa? So it's a piece of financial news of interest to anyone following eBay's stock, but not really to anyone else.

pgrote• 11 years ago

I think the important part is that it ends litigation between the companies, so any acquisitions of either ebay or craigslist would be easier.

cft2• 11 years ago

Time to buy ebay stock. There will probably be an aquisition with ~25% premium

pbreit2• 11 years ago

It gets rid of a tiny legal uncertainty. Much more significantly is that Ebay is apparently walking away from a massive financial gain and potentially even larger business gain by never having figured out any way to take advantage of Craigslist assets.

wpietri2• 11 years ago

For me it's the resolution to a very long piece of startup drama. As I recall it, an early CL employee got equity as a gift, and then sold it off in a way I thought disappointing:

http://web.archive.org/web/20040813165340/http://www.cnewmar...

EBay then launched a direct competitor, presumably using knowledge gained by being a major shareholder:

https://en.wikiphttps://en.wikipedia.org/wiki/Kijijiedia.org...

That also struck me as a shitty thing to do. Then eBay sued Craigslist and Craigslist sued eBay, causing further drama.

But now this is all over, and Craigslist can keep being Craigslist.

ableal• 11 years ago

http://pando.com/2015/06/19/pierre-omidyars-corporate-spying...

"""

Pierre Omidyar’s corporate spying scandal buried for good as eBay sells Craigslist stake

BY MARK AMES

ON JUNE 19, 2015

It didn’t get much attention, but eBay just quietly unloaded its 28.4 percent stake in Craigslist, putting to rest one of the most sordid episodes in Silicon Valley, in which eBay executives — including First Look Media publisher Pierre Omidyar and HP chief Meg Whitman — were directly implicated in corporate spying, stealing secrets, and exploiting Craigslist’s anti-capitalist idealism.

[...]

"""

prostoalex• 11 years ago

As I recall it, an early CL employee got equity as a gift, and then sold it off in a way I thought disappointing

To be fair, it's not like CL the company went out of their way to provide liquidity for that equity.

chejazi• 11 years ago

Interesting seeing eBay separate itself from these entities. First PayPal, now this. Are there others I'm missing?

DrScump• 11 years ago

Well, Stubhub would seem to be an obvious candidate. New management could make it much more profitable (e.g. add price floors like the other official resale marketplaces), but they would also face a potential avalanche of fraud cases they aren't prepared for.

bsimpson• 11 years ago

eBay Enterprise is in the process of being sold or spun off:

http://recode.net/2015/01/21/ebay-to-cut-2400-jobs-and-explo...

Not many people know about eE, but it was the third pillar of eBay (alongside Marketplaces and Payments). It gives the sort of national merchants you find in malls the tools to compete with companies like Amazon. When Donahoe agreed to spin off PayPal, he promoted the head of Marketplaces (Devin Wenig) to be the CEO Elect of eBay Inc. Devin promptly announced he wanted to divest Enterprise, essentially splitting the 3 silos of eBay Inc into three separate companies.

tegansnyder• 11 years ago

There is also the Magento Enterprise division.

mattbarrie• 11 years ago

My guess is paypal is going to apple and ebay to alibaba.

anant90• 11 years ago

http://blog.craigslist.org/2015/06/19/exit-stage-left/

Blog post on Craigslist's blog quoting Shakespeare.

brillenfux• 11 years ago

It would be so funny if EBay would finally be bought by Google.

known• 11 years ago

Is Alibaba buying EBay?

EBay Inc. Sells Equity Interest in Craigslist

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