Going From Giants to Startups (and Back Again)

It's hardly been two years since event planning site Upcoming was acquired by Yahoo, and now founder Andy Baio (pictured right) is calling it quits. Even though he is leaving Yahoo on good terms, his departure comes at a critical time as a steady stream of the company's talent heads for the exit. But according to Baio, this growing trend is less about finding the next hot ticket and more about fulfilling a pragmatic entrepreneurial calling.

"I think it's part of the natural ebb-and-flow," Baio said of entrepreneurs moving from big companies back to startups. "Entrepreneurial types are always itching to build something new, and that often means starting from scratch." For Baio, a departure from Yahoo means picking up the reins full time at his chronic side project, Waxy.org.

Despite the success he's seen with Upcoming, Baio also cautions that starting from the ground up shouldn't be about flipping the business. "Acquisition should never be the goal," Baio cautioned. "Build something people love, and build revenue to keep it sustainable. After that, the decision to sell is very personal." He continued, "For Upcoming, going to Yahoo! was the best thing we could've done to improve the site and grow the community, so that made the decision easy. But if you're only building something to flip it, you've already lost."

Source: Wired

With Growth Slowing, eBay Gets Innovative

How does a billion-dollar company with sagging growth get its mojo back? If it's eBay, it throws dozens of new features at the wall to see what sticks.

When Meg Whitman took the stage at the Web 2.0 Summit in mid-October, she announced that eBay had made more changes in the previous months than in the last three years combined. She wasn't kidding. The 11-year-old auction site's interface had long been a confusing morass of links and menus. No longer. Now the focus is on making the site more appealing to buyers through easier navigation, new ways to browse and more reasons to hang around. The strategy seems to be working: There's a feeling of freshness and fun the site hasn't had in years.

The changes were propelled by a kick in the pants: The growth of eBay's core auction business is slowing. For the first nine months of 2007, the number of listings on eBay was down 3 percent from the same period in 2006. Amazon is making a play for eBay sellers -- with some success, observers say. Despite eBay's diversification through purchasing Skype (for which the company recently took a $1.4 billion write-down), PayPal, StubHub and smaller ventures like StumbleUpon and Kijiji, it's important to note that 70 percent to 80 percent of eBay's revenue still comes from its online auctions.

Cantor Fitzgerald analyst Derek Brown says the biggest concern for eBay sellers is that buyer demand seems to be on the decline. "If, as eBay says, conversion rates and average selling prices have increased, why are sellers not responding through more listings?" he asks.

Corporate spokesman Usher Lieberman says eBay's management acknowledges that growth has decelerated. "About a year ago, the leadership of the marketplace business got together and took a hard look at what had been a successful business for 11 years," says Lieberman. "The (buying) experience hadn't kept up with what people expect when they go online."

To that end, the number of new buyer tools introduced in the last several months is staggering:

• A downloadable eBay Desktop application allows users to bid and get streaming price updates without opening a web browser.
• Three new widgets can be used on blogs and social networks outside eBay's walls: eBay To Go, GiftBay and eBay Marketplace for Facebook.
• Bid Assistant automatically places bids for a buyer.
• eBay Countdown is an easier (read: more in-your-face) way to keep track of auctions that are just about to close.
• eBay Deal Finder helps you seek out items that will close soon but have no bids entered yet.

This fall, eBay also unveiled a site redesign with sleeker, simplified graphical interfaces and new pathways to search for items. On eBay Playground (a version of the site where eBay tests new features), for example, the "snapshot view" of items displays search returns as a tiled wall of photos. Mouse over them, and pricing info pops up.

Other discovery features hop on the social-network bandwagon. Neighborhoods, a forum for like-minded collectors to network, got buzz when it launched in early October, and the still-unpublicized EKG allows users to curate their favorite items and share them with others, a concept similar to craft-commerce site Etsy's Treasury.

Rolf Skyberg, whose title at eBay is "disruptive innovator," frames the new social features using the "hierarchy of needs" theory proposed by psychologist Abraham Maslow in 1945. Retail stores, he points out, frequently sell hot dogs. Why? Because they meet shoppers' basic need for food, thereby enabling them to shop longer. If eBay can meet a shopper's social needs, perhaps she will spend more time on the site. (Skyberg recently gave an amusing presentation on the subject.)

The company is also stoking the marketplace fires for sellers. Between Oct. 18 and Nov. 5, eBay is discounting insertion fees by one-third, presumably to encourage more listings. In an Oct. 26 webcast, eBay hinted for the first time that it was considering volume discounts on fees for top sellers.

"That is so contrary to eBay's philosophy since it started," says Ina Steiner, editor of AuctionBytes, a trade publication for online merchants. "High-volume sellers have been demanding volume discounts for years. It wasn't until Amazon increasingly moved in on eBay's territory that eBay reacted to the demand."

Hani Durzy, eBay's director of corporate communications, responds that the company has always run experiments with its pricing structure and this move is "absolutely not" a reaction to Amazon's competition. "We expect that our sellers, even our biggest sellers, are multi-channel," says Durzy. He does add that eBay will be considering more pricing options in 2008 than it has in the past.

In putting forth all of these changes, eBay's whole corporate persona seems softer, less arrogant. It's clear the last year has brought a self-examination process, the fruits of which are now being humbly offered to the public. It's not a bad lesson to remember: Even the market leader needs to keep its customers happy.

The Secret Behind Trump's Success

...Trump writes, "Don't think about how you can make money. Instead think about what you can produce or what service you can offer that is valuable and useful to people in your community."

Anyone who reads Trump's books or attends his lectures might be disappointed that he doesn't outline a specific road map to get rich in real estate. That's because "real estate" in and of itself won't lead to success and happiness—it's following Trump's advice to find your passion that could do that. Once you do find your passion, says Trump, the money will follow. "It may sound simple, but I have become a billionaire many times over by sticking to this simple philosophy," Trump explains.

...I'm convinced that each person's success as a leader could not have taken place until each was truly inspired by a company's service or product and how it improved the lives of customers. One man who recently appeared on The Big Idea and with whom I recently had the chance to work is Cranium founder Richard Tait. His enthusiasm for his company was so contagious that he persuaded partners, investors, and employees to follow his vision. Tait's idea was to create a board game in which all the players could excel in one category or another. Cranium became the fastest-selling board game in history and sparked a worldwide craze. It all started with one man following his passion.

Do what you love, show the world why, and the money will follow.

Source: BusinessWeek

One Man Who Gives Thanks Daily

Carnegie Mellon professor Randy Pausch, diagnosed with terminal cancer, has some words to live by that ring particularly true on Thanksgiving

On this Thanksgiving holiday, when we sit with family and friends to express gratitude for the things we have in life, I will think of Randy Pausch. If you haven't heard his name yet, you should have. On the afternoon of Sept. 18 the Carnegie-Mellon University professor walked into a packed auditorium on the Pittsburgh campus and delivered his "last lecture."

It was a doozy.

Pausch spoke with the theatrics of a showman, the wit of a master comic, and the eloquence of a statesman. He recalled his own childhood dreams, his life's goal to enable the dreams of others, and the lessons he learned and wanted to share over the 46 years of his life. Pausch is a handsome man, with a full head of black hair, bushy eyebrows, and a remarkable sense of humor. Of all the lectures this computer science prof had delivered during years in classrooms, this one was especially poignant and urgent. He began simply enough by quoting his father who always told him that when there is an elephant in the room you introduce it.

So Pausch pulled up on an overhead screen a trio of CAT scans that showed the 10 tumors in his liver and spoke about his doctors' prognosis that he had three to six months of good health left. "That is what it is," he said simply. "We can't change it. We cannot change the cards we are dealt—just how we play the hand."

Close to Home

The one-hour lecture quickly became an Internet sensation. An estimated five million people have since watched at least part of it on the Web. (Click here to see the lecture.) After front-page articles in Pittsburgh's two local newspapers, the national media jumped on the story. The frenzy that followed—including an appearance on Oprah—culminated in a reported $6.7 million book deal for Pausch and a collaborator who wrote a story on him in The Wall Street Journal.

I was instantly drawn to the story, if only because three of my closest friends have been diagnosed with cancer over the past two years. Two have died within the past 12 months. The last of the three—with a death sentence of stage IV liver and stomach cancer — checked out of Memorial Sloan-Kettering Cancer Center on Sunday after extensive surgery. To put it mildly, I could relate to Pausch and what he had to say that day.

When one of Pausch's closest friends got the news four weeks earlier, he was stunned.

"Dude, you can't die," Steve Seabolt, a vice-president at Electronic Arts (ERTS), told him over the telephone.

"What do you mean?" asked Pausch.

"When you die, the average IQ of my friends is going to drop 50 points!"

"You need to find brighter friends," joked Pausch, trying to take the horror out of the sad news. The conversation recalled one of my own with a friend now lost.

Most of us go through our lives using no more than a small fraction of our potential. Pausch teaches us how to more effectively tap into the vast reservoir of unused talent and energy that resides deep within each of us. That is no small feat. In a world filled with distractions and frustrations, it often takes a tragedy to move us to action. By sharing his personal ordeal with us, Pausch created the urgency so many of us require to awake the human potential that is so frequently wasted.

So what did Pausch actually say that day? He spoke about the brick walls that often appear in the path of every accomplishment. "Remember," he said, pacing the floor, "the brick walls are there for a reason. The brick walls are not there to keep us out. The brick walls are there to give us a chance to show how badly we want something. The brick walls are there to stop the people who don't want it badly enough."

Believing in Karma

Pausch urged his audience to take great enjoyment and amusement doing whatever they pursue in life. "Have fun," he shouted. "For me, it's kind of like a fish talking about the importance of water. I don't know how to not have fun. I'm dying, and I'm having fun. And I am going to keep having fun every day I have left, because there is no other way of life. You just have to decide whether you are a Tigger or an Eeyore." Clearly, Pausch chose Tigger.

He advised us on how to get people to help us achieve our dream. "You can't get there alone," he said. "People have to help you, and I do believe in karma. I believe in paybacks. You get people to help you by telling the truth, by being earnest. I will take an earnest person over a hip person every day, because hip is short-term, earnest is long-term."

From the frenetic man in the black knit shirt and khakis, there was more, much more. Some of it you've heard before, from countless self-help books, management development courses, your mentor, or your mother or father. But coming from a dying man, it all seemed more real, more relevant, more gripping.

• "Never give up."

• "Apologize when you screw up."

• "Focus on other people, not yourself."

• "Don't bail. The best gold is at the bottom of barrels of crap."

• "Show gratitude."

• "Work hard. I got tenure a year early. Junior faculty members used to say to me: 'Wow, what's your secret?' I said: 'It's pretty simple. Call me any Friday night in my office at 10 o'clock, and I'll tell you.'"

• "Be prepared. Luck is where preparation meets opportunity."

• "Find the best in everybody. You might have to wait a long time, sometimes years, but people will show you their good side. Just keep waiting. No matter how long it takes. No one is all evil. Everyone has a good side. Just keep waiting. It will come out."

• "Get a feedback loop and listen to it…it can be one great man who tells you what you need to hear. The hard part is to listen to it. Anybody can get chewed out. It's the real person who says: 'Oh my God, you were right.' When people give you feedback, cherish it and use it."

For His Children

His incredible wit was much in evidence. The "best piece of advice, pound for pound, I ever heard," he said, involved a bit of counsel on romance. "When it comes to men who are romantically interested in you, it's really simple. Just ignore everything they say and pay total attention to what they do. It's that simple. It's that easy. I thought back to my bachelor days and said 'damn'."

With his lecture over, Pausch then threw his audience a couple of curves. He told them that his lecture wasn't about how to achieve one's dream. It was about how you lead your life. "If you lead your life the right way, the karma will take care of itself," he said, his voice softening. "The dreams will come to you."

And he said the presentation wasn't really for anyone in the audience. It was for his three children: Dylan, 5, Logan, 2, Chloe, 1. Their fondest memory of their dad will be an Internet video, one that everyone should watch during this holiday when we give thanks for all we have and all we sacrifice.

Let this be the Thanksgiving holiday when you turn off the TV football game and gather your family around a computer to witness a courageous man and his powerful words.

Byrne is executive editor of BusinessWeek .