It all started with a broken laser pen, sold for a few dollars. Now the eBay net worth increases by billions each year.
“Whatever it is, you can get it on eBay.”
While bold, eBay’s claim isn’t quite as far from the truth as it seems. Whether you’re looking for fishing equipment, antique coins or a new car, there is likely somebody somewhere selling what you want via the eBay platform.
eBay currently ranks as the eighth biggest internet company and the third biggest in the e-commerce industry. Amazon leads the way, but given that eBay relies on commission charges to generate revenue, the eBay net worth is staggering.
Unlike its retail competitors, eBay is an online auction house, which acts as the middleman between the buyer and seller. When a seller lists a product for sale, they are charged a small insertion fee, as well as a set amount of commission if the item is purchased.
eBay now completes more than $80 million worth of sales each year. Unsurprisingly, the company earns an astronomical amount of money.
eBay have established themselves as the go-to site for online auctions, but there have been plenty of ups and downs along the way.
Five key moments that increased the eBay net worth
1. Jeffrey Skoll named company president
Computer developer Pierre Omidyar coded the ‘AuctionWeb’ platform as a hobby in 1995. eBay recorded its first sale (a broken laser pen, which was purchased for $14.83 by broken laser pen collector Mark Fraser) and popularity boomed. The website formed as a company within a year and Jeffrey Skoll became company president. Various deals and partnerships followed, providing eBay with lots of exposure.
2. Benchmark Capital invest $6.7 million
Venture capital firm Benchmark capital decide to provide the up-and-coming auction site with $6.7 million in funding in 1997. This allowed eBay to improve and expand. The deal proved to be the best investment made in Silicon Valley, with their stake in the company now worth more than $5 billion.
3. eBay makes stock exchange debut
Three years after launch, eBay was listed on the stock market with an estimated value of $18 per share and a strong performance was predicted. However, eBay’s stock value rose to $53.50 during its first day, which left traders shocked. The auction site’s market cap stood at $1.9 billion by closing.
4. eBay launched in Europe
Former eBay vice president Michael Van Swaaij persuaded the company to launch sites elsewhere in 1999. The company believed that there would be little interest outside of the United States. However, eBay now successfully operates around the globe.
5. eBay acquires PayPal
eBay agreed to purchase online payment company PayPal for $1.5 billion in 2002, in order to simplify the buying process on the auction site. The huge deal highlighted the company’s growing wealth. Ebay have now added services such as Craigslist and StubHub to their portfolio.
With a number of popular websites and services generating revenue, eBay’s market cap currently stands at $37.3 billion. Although, with millions of new customers signing up to the service each year, the auction giants can expect their success to continue.