eBay Rejects GameStop's $56B Takeover as Not Credible

They probably should do more marketing.

Not parent, if you want to sell an old original video game you know has value, it's either the proper collector channel (slow, super involved, higher pay), the generic resale channels (fast, no effort, lowest amount possible) or ebay (relatively fast, a bit involved but not too much, pay depends on how good you defined the product).

I had some old stuff around that Mr everyday might find (eg pristine original Gameboy Pokémon cartridge without box), and quick resale would give me 10 euro, involved resale would ask me hours and hours of work ebay allowed me to sale for 120+euro spending 1h on the description and picture (to show the scratch etc).

Another case is "oh you have the msi ge77vx4 laotop and you look for the plastic keyboard map in azerty? You can pay a 500e rma if they even allow it or buy the piece for 20e on ebay and fix it yourself"

Ymmv but it has a specific place that no one really have right now

I was selling NES/SNES games + boxes. After ~2 years of sporadic sales, I ended up just offloading them to a guy who has a huge used games outpost at a flea market.

I buy a mix of things: clothes, watches, and usually tiles from my favorite pottery in Michigan: Pewabic.

I use it for non collectible stuff. I’m always buying weird interesting things. Old computer stuff at least once a month.

I buy most of my physical games from eBay too

Literally anything that isn't actively manufactured anymore. Even a lot of specialty stores will just sell through their ebay account.

It's great for used car parts (both buying and selling, as a hobbyist)

I frequently buy project car stuff on Ebay. You can find OE stuff with the part numbers scratched off that must have "fallen off the assembly line" pretty easily. Easily a few items per month between that and computer parts!

There's a lot of low volume and niche stuff sold by industrial ecommerce (grainger, Mcmaster, etc) and sites specializing in a given niche that those sellers cross list to eBay (the higher volume stuff is typically sold on Amazon)

Probably Pokemon or sports cards.

I'm the same way as OP. I'll go clean out my basement, find a load of old tech and just put it up in a bundle or sell it individually for dirt cheap. Likewise, I buy a lot of stuff like minimal wallets, micro-electronics like charging cables, dongles for my work laptop, phone cases. Just typically a lot of knick knacks or older tech stuff. There's a booming economy for old walkmans and cd players. Same thing with higher end audio stuff like older DAC's, speakers, amps. A lot of unique stuff you can't find on Amazon or elsewhere.

If eBay thought having storefronts would be advantageous, they would have them. It doesn't make a lot of sense for eBay to merge with Gamestop only for the combined entity to decide that the most sensible first thing to do is close all the Gamestop locations.

The physical Gamestop locations are also horrifically overprovisioned to be an eBay storefront. Many companies have already experimented with things like "lockers" which seem to be successful enough to hang around, probably because the costs are low enough they don't need to do much to justify themselves and they don't need dedicated store fronts. If they want better assurance that the things being shipped are what the sellers claim they are a partnership with UPS or Fedex and their wide variety of existing storefronts that are already provisioned with everything you need to ship almost anything makes orders of magnitude more sense, and nobody has to "acquire" the other to make that work, without the square footage of a Gamestop location.

I'm not sure I follow/buy the premise of moving second-hand sales to a physical building as beneficial to eBay.

If I'm looking for X, I'd much rather go to an online store, where I have access to several listings of X at varying prices and condition, vs. make a trip to a physical store, see if they have X, and hope that the condition and price matches my expectations.

Maybe if I'm not looking for X, and just want to browse a bunch of stuff (e.g. yardsale/flea market style), then a physical store could make sense.

But, to me, having this middle-man physical presence was already a problem, and eBay solved this.

I just don't feel like eBay needs GameStop.

Now, whether GameStop needs eBay is a different story. But GameStop is in trouble for two reasons:

1. Video games -- and therefore video game sales -- are moving to digital.

2. Physical stores are becoming a thing of the past for retail transactions.

eBay doesn't need GameStop's troubles.

TD didn't commit to $20B their letter only says they're "highly confident" they could raise that much. Very important distinction between the two.

I've yet to see a convincing vision of what an eBay physical store looks like that doesn't kind of boil down to a UPS store. The vast majority of their business comes from 3rd party listings and the only real stock they have and sell are in the eBay refurbished line. I'm really not convinced of what a successful eBay store would even be there for.

I've seen some say for authentication but staffing employees able to perform that authentication at even a fraction of existing GameStop stores would be extremely expensive (unless it's terrible authentication) so it again devolves to basically being a UPS store but for eBay shipping items out to be authenticated. Similar to what GameStop does with Pokemon cards and PSA grading except you can't really slab a Rolex or handbag so the authentication is only good so long as the good remains in the hands of the authenticator.

The only small service I think they could offer is a way for sellers to certify what's being shipped to avoid contests, but having that in every GameStop store is also very expensive for a cost they currently just shift onto sellers by siding with the customer. eBay could easily implement that if they wanted by partnering with UPS stores or a program where sellers video the packing or something.

I think you’re right about Kmart/Sears, though the interesting thing was that Lampert was correct that Sears had a great deal of real estate which had tremendous value. If someone skilled at retail had bought it, they could have used the money from selling some of that, to fix the business. Of course, Lampert was only skilled at finance and RE and very obviously just planned to gently wind down the business while selling off its assets, which is much less risky to do than fixing it - and may have yielded better financial results anyway.

That’s why the popular perception is that the Kmart transaction and Lampert killed it, even though their lot had really been cast 15+ years before, when they stopped innovating, and really stopped investing in their stores completely, without getting serious about e-commerce either. That poisoned their brand, which made it really hard to imagine turning it around.

> They already have the position of used buying and sales, extending that into in store receiving and listing of items on eBay makes sense.

Why do they need to buy eBay to do that?

I guess it comes to management.

I agree that if GameStop were basically rebranded as eBay brick and mortar stores, that might work. I guess I just feel like if it were GameStop itself that were managing it then it would be unlikely to actually work.

It's not like digital storefronts are new; I think GameStop should have been pivoting the moment that Steam started getting traction.

They still don’t have anywhere close to buying eBay.

You should also mention that Cohen never managed to turn Chewy into a profitable business before selling it off.

Similarly, his strategic initiatives at Gamestop have all been failure (e-commerce push, NFTs, digital games platform, crypto investments, ...). The only thing that has worked is aggressively cutting costs, mainly by shutting down stores, which was a plan that had already been proposed by BCG before Cohen came onboard.

Basically, he has done nothing except for taking credit for a plan that was already in motion and repeatedly diluting shareholders to raise funds that have been sitting in T-Bills ever since. There is no indication whatsoever that this guy is some kind of business genius who would be able to run Ebay better than the current management - quite the opposite actually.

Wasn’t there something where his comp package mandated 50b in market cap?

Ahh. 100b https://investor.gamestop.com/news-releases/news-details/202...

> works for no salary

Working for no salary is almost never charitable and is almost always just part of a larger tax avoidance scheme.

I wish we would normalize people just running a business well and taking a damned salary.

I do. Its great. You can walk around, look at things, talk to people, maybe buy something you wouldn't based on cover art or whatever. You get to drive a little, listen to some music.

I could maybe see this argument in 2018 or something

In 2026? Online shopping is full of low quality knockoff crap, with deveptive listings that are trying to trick you. Yes, I absolutely prefer physical stores again. In fact I've pretty much stopped online shopping altogether again

Me. I love the experience of getting out of the house. Also, online shopping is an extortionist on certain items. There are so many things that are 1/4 the price in a physical store than they are online due to shipping and logistics.

Dilated pupils. Delayed responses. Inattentive gaze. Speaking nonsense.

Drugs might explain many things.

Disagree https://www.youtube.com/watch?v=LTJvdGcb7Fs

Can you explain your thought process here? Perhaps we're "embarrassing my basic knowledge of finance", but I wasn't able to follow his math either.

I have absolutely no clue how you could watch the interview and come away with this conclusion. The purpose of an interview is to ask Socratic questions to allow the guest to talk about something of which they have intimate knowledge.

The CEO made it seem like he himself didn't know how the math for the offer worked, and even when presented multiple opportunities to correct that impression, he made no attempt to convince anyone otherwise.

GME had already acquired ~5% of Ebay shares ahead of the offer.

Someone call T. Boone Pickens and the Greenwash Boys!

Meanwhile they're now working on getting approval to dilute out another billion or so shares:

https://www.sec.gov/ix?doc=/Archives/edgar/data/0001326380/0...

"We are asking our stockholders to approve an amendment to our Third Amended and Restated Certificate of Incorporation, as amended by the Certificate of Amendment dated June 2, 2022 (the “Existing Charter”), to increase the number of authorized shares of our common stock to 2,500,000,000, and correspondingly increase the number of authorized shares of all classes of our stock to 2,505,000,000 for the reasons discussed below. Our Existing Charter currently authorizes the issuance of 1,000,000,000 shares of common stock and 5,000,000 shares of preferred stock."

Neither is GameStop

The sad part is the offer primarily focussed on how eBay can cut costs when a lot of that spending is probably accretive.

eBay’s biggest issue is their declining online shopping marketshare. They’ve gone from owning nearly the entire market to just losing it.

The fact that a guy like this can rise to the level of CEO making millions pretty much sums up everything wrong with the world. I don't think I would trust that guy to make a sandwich.