eBay History: Founding, Growth & Key Milestones

Pierre Omidyar

eBay possesses one of the most famous, founding stories in the history of the early dot-com boom, rooted in the chaotic, unproven nature of the early commercial internet. The company was founded in September 1995 by Pierre Omidyar, an effective, 28-year-old French-born Iranian-American software engineer living in San Jose, California. Over a long Labor Day weekend, Omidyar wrote the foundational code for a website he called 'AuctionWeb' on his personal computer. His foundational vision was not specifically about auctions; it was a philosophical experiment. He wanted to create an efficient market where buyers and sellers could connect on a level playing field, establishing the true, organic value of any item through transparent bidding. The very first item sold on AuctionWeb was a broken laser pointer. Omidyar was shocked and famously emailed the buyer to make sure he understood the item was broken; the buyer replied, 'I'm a collector of broken laser pointers.' This realization proved the viability of the model. The site exploded in popularity, initially heavily driven by the Beanie Baby craze of the late 1990s. The site's growth was so and instantaneous that Omidyar had to start charging listing fees simply to pay for the server costs (which were initially run on his personal ISP account). The foundational key move of the company was the invention of the 'Feedback Forum,' a self-policing reputation system that allowed total strangers to trust each other enough to exchange amounts of money. Omidyar eventually renamed the company eBay (after his consulting firm, Echo Bay Technology Group) and hired Meg Whitman as CEO, who guided the chaotic startup through the devastating dot-com crash and transformed it into a profitable, global corporation. Pierre Omidyar was born in 1967 in Paris. Education: Tufts University; St. Andrew's Episcopal School; Potomac School.