GameStop CEO Ryan Cohen Wants to Buy eBay: Our Full Interview

Um I grew up in Montreal. Um, always been an entrepreneur. Uh, I started selling uh, pet food online in 2011. I was shopping at a neighborhood pet store, going every few weeks. Uh, I had a poodle at the time and um, we were about to get into a totally different business, online jewelry. Did not know anything about it. And uh we ended up selling all the jewelry for actually got probably uh 80 to 90% back and within a few weeks I was uh selling pet food online and the rest is history.

Um it was like a five or six pound poodle. a little Alli's Alli's parents both have a giant poodles. Big poodles. Yeah, they're great dogs. I had a small play, so I didn't have I grew up with a Labrador that was much larger, but then I needed something more compact and doesn't shed. Best dog ever. Super smart.

Um I didn't spend that much time in school. So um so I remember growing up going to my father's office which was a warehouse. It was probably about 25,000 square ft. He sold glass. Exactly. So he would import it from China and he would sell it to local businesses and um I would see him in a suit and he would take off his jacket and he would be in the back warehouse working with the guys unloading pallets and he would do it for hours. And you watch that. Yeah. And you know, he would basically then come into the front and he would be drenched in sweat like you could see through his shirt. And he didn't even say anything. He would basically then go back onto his typewriter and he would work at his desk and he did everything from working in the back with the guys to working at the desk doing administrative work and sales and everything in between. And so, uh, he didn't consider the part of him sitting at his desk work. Yeah. Because if you weren't physically working and you weren't sweating on the job, then it wasn't work. So, when he saw me on the computer and I was working and he would ask me, 'What are you doing?' And I would say, 'I'm working.' Say, 'That's not working. You're playing on the computer.' Could not correlate anything that wasn't physical labor. If it wasn't that, then it wasn't considered real work. And so his work ethic was I've you know he'd wake up at 4 4:30 in the morning. He would go uh running outside in Montreal and minus 30 weather and he would come back in and his face mask would be totally frozen. He was in like a tracksuit. He was just a machine. And then he was at the office from the first one to open up at 6:00 in the morning. Last one to leave the office. the only one with a key. So, I've never seen that level of dedication and work ethic. And if he was sick, it didn't make a difference. He could have food poisoning, the flu, he still went into the office. No excuses. So, he really instilled true work ethic from like the very bottom of using your hands, getting them dirty. You're not afraid to get your hands dirty. Yeah. No, he loved it. I mean, it was uh it was even from, you know, cutting the grass in front. It was filled with poison ivy and it didn't make a difference. He would get poison ivy all summer, but he wanted to cut the grass himself. So,

Um well I am going to be the CEO of the company and I look at the sellers as the customer and there are hundreds of thousands of sellers that um small businesses that uh their livelihood depends on this And there is a huge opportunity to um do a lot more business and to and to make the customers happy. And for me, what that means is talking to individual sellers, understanding what are the bottlenecks, what are the issues and fixing it. And um I can only really tackle those problems by having conversations with individual sellers and understand the issues that uh they're running into. And I get emails um with sellers telling me all kinds of issues that they run into where they're they end up getting paid an item doesn't I actually I just uh got one yesterday where they got paid, they never shipped the item and eBay told them not to ship the item. They ended up getting paid. It was like an $8,000 sale sale and then they ended up not shipping the item because eBay told them that it was a fraudulent buyer and then they ended up basically debiting the account for more than what they ended up paying them for originally.

Well, uh there's there's a there's a few different reasons that kind of all pull me in this direction. Uh one being e-commerce is something I understand and physical retail I've been learning on the job. uh and in many ways it's a very different playbook physical retail versus e-commerce. So one is it's a business that uh given my Chewy experience I understand very very well. Uh number two is as GameStop has moved from a a business that was really a dying brickandmortar retailer. It's really like Blockbuster. same kind of forces going against it and uh the business has transitioned to today it's a leader in collectibles and I've come to appreciate the the industry and uh eBay's place in that industry and so there's a lot of category overlap um and that's what really got me thinking about eBay in the first place is us going into the collectible space and then if you look at our refurbished tech business there's also So, a lot of overlap in that and the secondhand uh piece of of the business as well. And so, uh, there's a lot of reasons why GameStop operationally and eBay make sense and a lot of opportunity to to use the infrastructure of of of GameStop and really use them as nodes uh, and use them anything as from studios to logistics and fulfillment and uh, same day authentication. And if you look at today as an example within trading cards, if you sell a trading card on eBay, you're sending it to a centralized hub and so it takes time and there's additional cost to it. Whereas we can leverage the stores for same day authentication.

Totally.

Yeah, eventually definitely.

Yeah, I mean um we would offer the ability to use stores as anything from filming content if content creators want to actually film content in the stores and um we can handle everything from that to the logistics and the fulfillment side of it. So essentially whatever you sell you drop it off at a store and we can take care of all the fulfillment and essentially acting as like a UPS store FedEx Kinko service. So that content creators can focus on what they're best at content and then we would basically take care of everything else.

So the people uh this is true in almost all businesses but especially in corporate America. The people that are doing the most work are the people who are the least paid. And then you've got middle management which are basically delegators. And then you have all the fancy titles from the directors and the VPs and the C's. And essentially what they're best at is uh PowerPoint presentations, public speaking, they're sweet talkers, but they're not actually real workers. So, uh, I would run the business much more efficiently because the people that are actually on the ground doing the work, you basically cut out all the BS in between and you work with the people that are are working with the sellers that are working with the customers and you get rid of basically all the noise and then you actually that's how you have a feel for the business is like when you're on the front lines talking to sellers directly And that doesn't exist anymore. And like as soon as businesses you you develop this level of bureaucracy, um you lose a feel for the customer. And everything that I've heard is that eBay's lost a feel for the customer. And so that's where the efficiency is going to come from is getting rid of all of that bloat. You look at even the performance of the business and how much money is spent on sales and marketing for essentially no growth. When instead you can be growing the business organically by creating better tools and you create better tools for your sellers and they bring more inventory on the platform and then boom, all of a sudden more inventory, more sales. So, um, it, you know, you look at GameStop's marketing budget and it's come down significantly cuz there's no return on investment in this. And you talk to the marketing team and again, they're all going to say, well, look here and look there and all this stuff and it's making money, but most of that money is is being lit on fire and you could see it. I mean, basically since co eBay's business is down, they've got 30 million less active users. They've basically barely grown and everybody else in e-commerce, both in the US and globally, it's grown considerably because e-commerce is growing, but eBay is not. So,

Exactly. It would come from sellers doing more business on the platform and actually increasing transaction volume.

Yeah. I mean, yeah, eBay for us, eBay has just been a unfortunately now it's just a platform for us to sell on and make money. there hasn't really been that like seller relationship with eBay for a while. Um, and it's I I think it was at one point, you know, back in like 2018 when we went to eBay open and we had like concierge service and stuff like that. There was an eBay community for resellers and there was loyalty and pride as an eBay seller to sell on the platform and you cared about eBay and you had your gripes. We complained about things, but all of the changes we asked for, not only did they not give them to us, but they wasted an obscene amount of money into some weird corporate pet projects that they just wanted to roll out like augmented AI back in 2019 or right that was 2019 or 2018. They gave us this bizarre thing when for I don't know maybe the de last decade everybody was requesting please make it so that when buyers buy something from you they have to pay. They can't just leave you high and dry where you then have to relist the item because eBay systems don't even relist your item when the buyer never pays. Like their systems are so not only antiquated but they're incompetent. Like you can have an antiquated system if it works. that's fine. But if it doesn't work, why are you keeping it? And why aren't you spending money on that? Why are you spending it on ridiculous pet projects that corporate wants to do? because it just sounds nice to I don't know money for somebody somewhere that and brand marketing and feel-good advertising when everybody knows eBay already exists and it's iconic and so you don't have to be, you know, blowing hundreds of millions of dollars on on brand marketing that you basically can't measure. But really, it starts at the top. Like at the end of the day, you know, you you look at my experience and my father never told me you have to work hard, you have to work hard. If he would have told me that, then I would tell everyone you have to work hard, you have to work hard. It's just words. Like words are meaningless. Leadership to learn to be a leader, it's it's by example. It's not what you say, it's what you do. And so if the CEO is not talking to sellers and understanding the issues with the business, then no one's going to care. If if you're not focused on making your customers happy and the CEO, that's not his number one job. Then no one at the company is going to care because they're just going to follow what the CEO does. So, you know, at Chewy, I would take customer service calls myself. If if someone went and said, 'I want to talk to the CEO,' I would talk to them. All of a sudden, everyone in customer service understands it's really important. We have to make the customers happy.

I mean, it was uh it was a a significant amount. And and by the way, it was it was not um it wasn't an expense. It was an investment. Like it if you look at what happens, you make your customers happy and all of a sudden they start telling other people and that's the best marketing you can get is referrals and word of mouth and and from customer service we would get all kinds of intel in terms of what are the additional products that our customers want, what are the problems on the website, what's broken. So like and the people who work in customer service would end up working by the way and that's what it means like basically people would work in go from customer service to work in merchandising and marketing and supply chain. They were the ones that were most qualified to work in these departments because they understood the customer. So if you don't understand the customer you're not going to do a good job, right? And I mean in this case, if you're not talking to sellers and you're not understanding what are the problems with the platform, why all of a sudden are you moving your business to whatnot? Why does whatn not even exist? Like, by the way, you do a good you do a good job and you're not going to have competition because your customers aren't going to want to go anywhere else. There's no one else, by the way, that's racing to build another Chewy. It's Chewy and Amazon. And Amazon was there before I started. They were in they started in 1999. So no one's racing to go and sell pet food online anymore. But yet within eBay's business model, look at all of the competitors that have been able that have developed and picked off significant portions of their business. And that's why the business has basically been like this and e-commerce has basically taken off. I mean I can tell you as a matter of fact if when we started on whatnot what outside of Amazon we only sold on eBay and Amazon that was it not all the other platform everybody else whatnot was the third platform that we ever sold on and it was because they reached out to us and said hey give us a shot we'll we'll pay you to come onto the platform come try it out and do it if when that happened if whatnot reached out to us and eBay was also developing live and they said hey why would you do that guys you already are established on eBay you have customer base. We're the biggest platform in the world. Why would you do that? Just go live on eBay. If that had happened, we would never have even sold on whatnot to begin with. Now, we've done more revenue on whatnot than eBay. And whatnot incentivized us to sell more by giving us, you know, whatever the incentive was, like reduced fees if you hit a certain threshold. And then it pushed us to put even more of our products onto their platform, which was very clever. And it was very they systematically like stole resellers from other platforms and they went they they did they systematically went through every reseller on social media first. They went through all of us and then they started to go to people beneath right like right under that were big sellers but maybe didn't have a big following. So it was very clever and they took a ton of business from eBay because they were systematic. Yeah. They knew what they were doing. They've done a great job.

The plan is to do whatever it takes. Um, and ultimately it's going to come down to shareholders and and really what's really happening here is it's just deciding it's a leadership change because your shareholders what we are proposing is that you know it's basically half cash and half rolling over their equity. So essentially they still own eBay. it just you're deciding who's more qualified and who do you want to run the business and who's who's going to be a better fiduciary of the business basically the current management team or or me and I think I also want to make a big point here that this isn't you buying a company and then putting people in place and and hoping that it runs well you're investing a lot of your own personal money into this purchase and you're you're taking a personal role in the this. Yeah, I'm going to run it myself.

Yeah. Well, I am so when I say perverse incentives, when you have a management team that's not invested and basically gets stuff for free and they're not taking any risk, then that's a perverse incentive. I am going to be investing my own money into acquiring the company at $125 a share. And I don't get management fees. I'm not taking a salary. I have not taken a salary from GameStop, not a dollar. And it would be the same thing here. Um, and I'm not going to do well unless the business grows. Otherwise, my equity is going to be going down in value. If I maximize shareholder value and I make money for shareholders, then I make money for me. And if I screw up the business, then I end up losing. So, like, it's a very simple concept. I'm going to be an owner.

Business does well, I benefit. If it doesn't, well, then I'm going to end up losing a lot of money. And that's not the plan.

So, if I don't make the sellers happy and they're not doing more business on the platform, that's not going to be good for my business.

Love that. I'm not going to sell too much pet food at Chewy if we ship slowly and if we charge more than our competitors, you're going to show up somewhere else and take your business elsewhere if you're not happy with me.

It's amazing. Yeah.

Yeah. I don't know if I have sugar all day. I need to.

I drink that. I drink ginger ale. Um, sometimes I switch it up if I want to get crazy with like a little bit of Fanta.

It's like orange crush. It's basically like orange.

It's in my water right now. And I'm like I just want to keep drinking it. It's so good.

It's so boring.

It's true.

Going to make the business stronger, going to make the business better. I want sellers to have a better experience. The business needs to do right by sellers. Sellers unequivocally are the customer. I don't act or behave like an owner because when you say something like that, it's like you're pretending. There's no pretending. It's either you have all your chips on the table and you've got everything on the line or you don't. So it's not like we're gonna behave or act like owners. I'm gonna run the business like Chewy and like GameStop, which is I've got everything on the line. If I don't make the customer happy, I'm not going to have a business. I can't tell other people how they should feel, but I'm going to be an owner because I am an owner and because I'm going to have everything on the line. Ultimately I believe that's going to translate into a better experience. And if I screw it up, well then I'm the one that's going to lose the most. So I better not screw it up.

Unfortunately, historically with eBay, this is what's happened. They say they're going to make these changes, and then we'll complain for five, six, seven, eight years about how that's never changed. And then we go to an event and someone pulls me aside and says, 'Hey, we're working on that. We're going to change that one day. We're going to change that soon.' And I tell them, 'Hey, I'm excited. Just call us whenever you're ready and we'll make a video about it.' We haven't gotten a call yet. It's run like the government. Nobody gives a damn. When you're getting paid a lot of money regardless of performance, what's the incentive? It's the perverse incentives. There's nothing wrong with things looking like they were from 1995. Amazon's front end still basically looks the same. But if you look at Seller Central, you don't have to go outside of Amazon's ecosystem because you can do everything in Seller Central. Power sellers are using all kinds of third-party tools, spending a lot of money because the backend sucks on the core marketplace business and also on live commerce. It's just doing the basics really well. It's not rocket science. Selling pet food online means you got to ship quickly, be competitively priced, have 24/7 US-based customer service. Make the customers happy, everything takes care of itself. eBay's business, make the sellers happy, everything is going to take care of itself.

It's true.

You don't have to go to college to learn that. You'd save hundreds of thousands of dollars to realize in business if you make your customers happy, you're going to have a strong, profitable business.

Doesn't look like it. When you look at spending two and a half billion dollars for a million new users, that's spending 2,500 bucks a customer. It's crazy. Looks like it's basically being wasted. They would be better off just walking around giving out gift cards for eBay of $2,500 to random people and having them spend the money on the platform. They just don't even know how to do the marketing.

I like it. Go crazy. Amazing. I shop on Ryan Bay.

Well, I was not ready for that. That's a deep question. If you listen to him, I'm here to work. I'm here to be a productive member of society.

Yeah. I mean, that is what brings me fulfillment, being productive. If I'm not building and if I'm not being productive, if I'm not working, then I've tried to do other things like hobbies, but it just doesn't. I know some people get enjoyment out of that stuff, but Ryan, have you ever played pickleball?

No, you're about. It's like the capital pickleball capital of the world. I play every day. That's what I was asking. It's a fun game. You should play.

It's a wonder. Yeah. No, sports are good too. They give people discipline. Work is important for the same reasons. It's just discipline. So that's what brings me fulfillment, building something.

It's a good question. If you look at Dubai as an example, what they've built there in a very short period of time is very impressive. It's a country filled with immigrants, Russians, Filipinos, Pakistanis, and everyone is there basically just to work hard. In many cases, they've left their families and they're sending money back home, but it's 24/7. They're building buildings that would take us 10 to 15 years to build in a year. When I see something like that, I have respect for it because that's the way it is. Let's get stuff done. By the way, China similarly, if you look at what they've done in the past 40 years, they've lifted 700 or 800 million people out of poverty. Politically, that's a whole other topic, but you look at what the US has done in 250 years, they've done it. Their way of life is different, their values are different, but they work hard. I will say I've never met harder working people. We spent a year in Australia and on the way back to America, we spent five days in Beijing. Those people work so hard. The Chinese work so hard. Nobody has any understanding of how incredibly hard the Chinese people work. It's amazing.

Yeah. I mean, that is pretty much maybe the only thing that I respect is hard work. I don't care about someone's personal beliefs or values. The only thing I care about and what I respect is someone who works hard. So if someone's like that, then I want to be their friend. And if they don't work hard, well then I don't like them.

Oh, that's a good question because we're similar age. South Park is really funny. I mean, I love South Park as an adult so much.

It was amazing. I saw the play a while ago. That was good. Yeah.

Black.

I like chocolate a lot. Dark. Really dark. 90%.

That's how I am with coffee. I want it to hurt me when I drink it.

Yeah. Well, I have to say I'm pretty good at Mario Kart.

Okay, I'm going to take you up on that. But it's got to be the N64 version.

Okay.

This is tough. That's a tough one. Not answer that question.

I guess mine would be staying up late. Getting enough sleep is important. Social media in general, with the exception of Twitter, is one of the worst things to happen to society. People are easily manipulated on it. They upload pictures and videos of a life that doesn't exist. It's really a terrible thing. Not even just from a productivity standpoint, but from a value standpoint. Instead of teaching people the value of hard work and having good values and being responsible and finding happiness through the simple things in life, people are being manipulated by a completely fabricated lifestyle. People upload filtered pictures and videos showing they're so happy when they're really not. The people doing it are actually the most depressed, and that's why they're doing it in the first place. Or they're doing it just to post because they feel obligated to.

Yeah. I mean, it's really stupid. It's really bad. It's toxic.

Yeah. So everyone listening here, maybe do it.

Yeah. I mean, if you don't make your customers happy, you don't have a business. If you're not willing to roll up your sleeves, it's not even just leadership by example. Physical labor feels good. I like to vacuum. I like to clean. I like to lift heavy things. I like to sweat and work. It feels good. It feels way better than sitting on the computer and watching someone else clean. As America has developed, we've moved away from a manufacturing society to an economy based on consumption. We don't work anymore in this country. We don't want to roll up our sleeves and do physical labor. We like to delegate it. I think it's healthy and it feels good to sweat and to work hard and to do things physically. It's not even just to teach other people to do it. Actually, I don't know the chemicals in my brain, but you release endorphins and receive dopamine from doing hard work because you see the value in it. It's like exercise is five times more beneficial than antidepressants. It's good to work hard.

I am going to make sure that eBay is going to fucking win. Basically it's that simple. It's going to fucking win. It's going to be a very strong business. And I'm going to get rid of the bullshit. I've got everything on the line. Not because I have to, because I want to, because I believe in the company. I believe in the potential, and I see exactly what the sellers see in this. This is something that I want to do for a long time and I want to invest in it. I want to grow it and it's going to fucking win. Let's go.

Oh yeah.

Um, well, I'm a little bit superstitious, so I don't want to say a number. But what I'd say is the general consensus is that everybody thinks it's very unlikely. I saw something on Polymarket where it was like 14 or 15%. But I like that because the odds of success with Chewy were very low. GameStop basically was a dying brick-and-mortar retailer and now the company is doing better than it ever has in its history. This is compared to when people were lined up in the malls for the next hardware and software releases. I like the low odds.

I enjoyed it. It was a pleasure speaking to both of you. Thanks for having me in.