Face Time With Meg Whitman

The CEO of eBay runs one of the few dotcoms that's still left standing. What will be the opening bid for her words of wisdom?

Age: 44
Family: Husband, Griffith Harsh, a neurosurgeon at Stanford; two sons, ages 13 and 16
Pre-Silicon Valley résumé, in chronological order: Princeton, Harvard MBA, Procter & Gamble, Bain & Co., Disney, Stride Rite, FTD, Hasbro/Playskool
First email account: 1997
Number of new items listed daily on eBay, May 1998: 60,000
Number of new items listed daily on eBay, February 2001: 700,000.

When the headhunter first called Meg Whitman in November 1997, she had no trouble saying no to the CEO job at a Web company that she'd never heard of. At the time, Whitman was head of Hasbro's Playskool division -- 600 employees, $600 million in annual sales. She had two sons, her husband was head of neurosurgery at Massachusetts General Hospital, and she was Mr. Potato Head's boss.

But the headhunter was the legendary David Beirne, in Silicon Valley, and when he called back, Whitman agreed to fly out and talk to eBay -- ultimately accepting their offer. The company has since become a stealth force in e-commerce. While collectibles make up about 40% of the items sold on eBay in terms of dollar value, Whitman says that eBay is the Internet's number-one seller of consumer electronics, ahead of Amazon.com and Buy.com. And it is number two in books, movies, and music.

Whitman spoke first in a conference room at eBay's San Jose headquarters, and then in a car on the way to the airport.

You were premed at Princeton. What happened?

(laughing) I took calculus, chemistry, and physics my first year. I survived. But I didn't enjoy it. Of course, chemistry, calculus, and physics have nothing to do with being a doctor, but if you're 17 years old, you think, This is what being a doctor is going to be about. After that, I had to find something else to do. I began selling advertising for a magazine that was published by Princeton undergrads. It was more fun than physics.

You'd never heard of eBay when Beirne called?

Never. The site was called Auction Web then, with a subcategory called Auction Classifieds, and that's what it looked like. I remember sitting at my computer saying, I can't believe I'm about to fly across the country to look at a black-and-white auction classified site.

What turned you around?

Really, two things. One is that this Web site had created a functionality for people that did not exist before the Internet. And then Pierre Omidyar, eBay's founder, said that people had met their best friends on eBay, had traveled with other eBay users. That people had connected over a shared area of interest. I said, This is huge. But I knew that I was coming to a startup. There were 19 people here. The books were on QuickBooks.

It's funny, because in press accounts, there's still a little of, "Meg Whitman eventually joined eBay," as if the place was up and rolling, and then they needed a grown-up. But you're as much a part of the culture here as anybody ...

Yes. I have enormous respect for Pierre. He taught me about communities on the Web. But what I brought to the table was that I knew what we were going to need if the company continued to grow. My job was to uncover what was going well. I think sometimes when a new senior executive comes into a company, the instinctive thing to do is to find out what's wrong and fix it. That doesn't actually work very well. People are very proud of what they've created, and it just feels like you are second-guessing them all the time. You are much more successful coming in and finding out what's going right and nurturing that. Along the way, you'll find out what's going wrong and fix that.

What have you bought and sold on eBay?

I bought Beanie Babies when one of my sons was very much into Beanie Babies. And I sold children's books that we didn't need anymore. It was great. Here was a book that you didn't need, and you might get $6 or $8 for it. Next, we bought Pokémon cards. Then we sold Pokémon cards. Sort of the round-trip on Pokémon cards. And the latest thing I've been buying on the site has been a lot of fly-fishing equipment.

Who does the fly-fishing?

I do. My 16-year-old was very anxious to learn. He loved it, and he said, "Mom, you are going to love this." We go five or six times a year.

You often talk about the power of the army of eBay users. What is that power?

At Hasbro, we used to spend a lot of time trying to pick the next hot toy -- the next Cabbage Patch Kid, or the next Pokémon. At eBay, we don't worry about that. Our army of users figures out what's hot before we even know.

How does the slowdown in the U.S. economy affect eBay?

Our hypothesis is that in a slowdown, eBay actually benefits. And that's because buyers still want the things that they want. Consumer electronics, computers, whatever. Yet people will become more value-oriented. At the same time, I think that we will actually see an increase in sellers. You may get gifts that you don't necessarily want, things you don't use anymore -- things that you can sell on eBay and raise some cash.

At eBay, you have a cubicle like everyone else. Do you miss anything about life at Procter & Gamble/Bain/Disney/Hasbro? Your office?

(laughing) You know, I don't actually miss the trappings of the offices I used to have. I love being in a smaller environment, feeling like I'm in a bit of a PT boat, as opposed to a battleship.

About two years ago, you said that you were only going to be the CEO of eBay for five years.

Yes. (laughing) It was on the heels of our systems outages -- an incredibly stressful time -- and I wasn't sure that I could actually do it for longer than five years. It really is a 7-by-24 job -- you're constantly on call. But the management infrastructure we have built makes this a more manageable long-term play for me.

I haven't heard a retraction of the five-year plan.

(laughing) I think I'm going to be here a little longer than that.

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