eBay's Affinity for Meetup.com
The online auction colossus has caught a dose of community activism. On Mar. 9, eBay (EBAY) joined five other investors to purchase a minority share in community Web site Meetup.com.
The investment will total just more than 10% equity interest in Meetup.com, which connects folks to affinity groups like stay-at-home moms or Chihuahua lovers for offline gatherings. Although the companies refuse to reveal the dollar value, estimates put the investment -- in which eBay is joined by Omidyar Network, Draper Fisher Jurvetson, Esther Dyson, Allen & Co., and Senator Bill Bradley -- at less than $10 million.
The investment makes sense for eBay as it continues to focus on building communities, says spokesperson Hani Durzy. "You would never be able to separate the community from the commerce on eBay," he says.
LOTS OF OVERLAP.
Also, eBay is looking to connect to more consumers locally. To that end, Durzy says there is already significant overlap in users. He points to a Dallas Meetup group formed for folks who sell on eBay. Says Durzy, "We see a similarity in philosophy."
Indeed, Meetup plans to use a portion of the investment to launch six conferences across the country not so dissimilar from the eBay Live conference the company holds annually to bring sellers together. Says Scott Heiferman, "We want to help organizers become great leaders." The first Meetup conference will happen in Houston in May.
Also, Meetup will use its new resources to launch an advertising campaign to draw attention to local groups. The first Meetup posters will hit New York City subways on Mar. 24, says Heiferman.
Founded in 2002, Meetup first gained national attention for launching Howard Dean's brief Presidential candidacy during the 2004 elections. The site had 54,000 Meetup groups listed last May, when it began charging a small subscription fee of up to $19 monthly to sponsor the groups. Since then the number of groups has dropped to just over 10,000, but more members have begun attending meetings. "Members are more active because the quality of the groups has improved," says Heiferman.
In addition to large recent acquisitions such as Internet phone provider Skype.com, eBay has purchased minority stakes in other Web sites as an effort to learn about new forms of community-building. In August, 2004, the company purchased a 25% stake in online-classifieds site Craigslist.org. The company also has a minority stake in MercadoLibre.com, an eBay-like auction Web site in Latin America.
Pierre Omidyar, eBay's founder, already holds a seat on Meetup's board. "My belief that business can be a tool for social good is validated by eBay and Meetup's ability to connect people over shared interests through a for-profit model," he said in a statement.