eBay buys StubHub, online ticket reseller, for $310M
StubHub, an online site for reselling tickets to events, has been acquied by eBay for $310 million, minting the latest Silicon Valley millionaires in co-founders Jeff Fluhr and Eric Baker. — The controversial company has grown steadily, badgering eBay's business for years.
Context & Ripple Effects
eBay has been building beyond its core auction business through acquisitions, including PayPal in 2002 and Skype in 2005. The $310 million StubHub transaction adds a specialized marketplace where ticket resale, rather than general merchandise, is the core transaction.
StubHub brings founders Jeff Fluhr and Eric Baker a cash exit while placing its ticket-resale operation inside a larger consumer-commerce company. The deal’s broad same-day pickup underscores the significance assigned to eBay’s move into a contentious resale category.
First-order effects
- StubHub becomes part of eBay, giving eBay an established ticket-resale marketplace and giving Fluhr and Baker the proceeds from the $310 million sale.
- Ticket buyers and sellers using StubHub gain a marketplace backed by eBay rather than an independent company.
Second-order effects
- Independent ticket-resale services must compete with a platform whose parent already operates a large online marketplace and payment service through PayPal.
- For eBay, the purchase creates a test of whether a focused marketplace can add transaction activity alongside its broader auction business.
Third-order effects
- The deal extends eBay’s acquisition-led expansion from payments and communications into specialized commerce, increasing the importance of category-specific marketplaces within its portfolio.
- If eBay can preserve StubHub’s focused liquidity while applying its marketplace infrastructure, consumer internet commerce may tilt toward large platforms owning distinct vertical exchanges rather than building every category internally.
The trend: eBay is using acquisitions to assemble consumer-internet services around its marketplace, with vertical transaction platforms becoming a strategic complement to general auctions.