Philanthropy eBay’s Jeff Skoll on business’ social revolution

eBay went public in 1998 and Fortune magazine now estimates it’s co-founder Jeff Skoll is worth around US$3.8 billion. Skoll, who is just 38, has progressively wound down his involvement with eBay and now commits much of his time and energy to philanthropy. His Skoll Foundation is dedicated to helping social entrepreneurs and recently he used his foundation to set up the Centre for Social Entrepreneurship at the Saïd Business School at Oxford University in England.
Skoll talked to Des Dearlove for Management magazine. He explains why he is so passionate about social entrepreneurship: combination of business and social responsibility that he believes will be the business and social revolution of the 21st century.

What was so special about the eBay business plan?
The business plan evolved. When we were first starting out, the business proposition we had was really quite tenuous. It is little-known story, but when we started out eBay was simply intended to be the holding company for bunch of different online services. One of these was service we called AuctionWeb, person-to-person online auction. In those early days we saw disaster around every corner. It was quite possible that the whole thing would fall apart right away.
Our first business plan, the one I wrote when it was just me and Pierre in room, had AuctionWeb developing as one line of business. We had second line of business licensing the technology to other companies. We actually did that. We licensed an online auction service to biotech company that was selling biotech equipment. We also licensed the auction technology to start-up online travel company that was trying to auction off hotel rooms, plane seats and the like. We were always mindful that at any given moment bigger company, Yahoo! an AOL or an Excite, could turn its attention to this space, copy what we had done, and very quickly swamp the numbers we had developed.
It probably wasn’t until the early part of 1997, about year and half after we launched, that we realised growth was continuing, nobody was copying us and we thought, yeah, we have chance to make business around this auction service by itself. And so the next version of the business plan called for us to focus on that service which we re-branded as eBay. We dropped the AuctionWeb name and we went from there.

And the rest, as they say is history. Did eBay have social mission from the beginning?
Absolutely. From the very start, the success of the community was the success of the company. One of the things that we were most proud of was that there were people who were buying and selling on eBay that substantially improved their lives. They had access to level playing field, something they had never had before. Single mothers were able to stay at home with their kids and make living, disabled folks were able to make living. Seniors, who couldn’t get around too well, could make living, and they were also able to communicate with lot of other people.
Because of the way eBay started there was lot of collector-oriented material being sold on the site. Often the seniors might be experts in particular field. All of sudden, rather than being isolated in their homes and unable to see many people, they are able to share their knowledge online with other people who appreciated that.
There was good combination of heart and wallet right from the start. There was recognition in the genes of the company of the importance of giving back to the community as the company grew. It led to the eBay Foundation which was unique at the time. It was the first foundation created with pre-IPO stock. It took little bit of work to make happen, but once we did it became model that other companies have since followed.

Was there turning point where you thought it was time to do something instead of eBay?
The turning point for me came about two and half years after eBay went public in 1998. The company had reached the point where I felt comfortable that the management team could handle the business without me being there. Because of my involvement in the genesis of the company, until that point there was always something, some value or some knowledge that I had of the way that it all worked. So I was very reluctant to let go.
Once I felt that the values had been infused in the management team (and it is superb group of senior managers, much more experienced than I was), once I felt that they had grasped the incredible importance of that community-company synergy and the values that held it together, at that point I felt comfortable moving on to start pursuing the dream I had of making difference to the equation of inequities.

What do you think the term social entrepreneur means?
At the Skoll Foundation we call social entrepreneurs society’s change agents: the pioneers of innovation for the social sector. I think there is lot of overlap between social entrepreneurs and business entrepreneurs. Both see and act on what others miss, the opportunities to improve systems, to create solutions, to invent new approaches.
Like business entrepreneurs these folks are also intensely focused, self-driven, and very determined in pursuit of their vision. The biggest difference though is that whereas business entrepreneurs go after problem from purely economic viewpoint, social entrepreneurs usually have vision of something that they would like to solve in the social sector. They are not necessarily in it for personal materialistic or monetary remuneration.
I’ll leave it at that for the definition, but I firmly believe that there is groundswell. The concept of social entrepreneurship has been around for long time. The last 10 years though have brought an awareness of, and an infusion of people into the field of social entrepreneurship. It’s important.
The traditional approaches that we’ve had in society to address problems have been primarily through government or business, even technology, and the advancement of technology. But more people now realise and recognise that the social ills around the world are not going away, and that traditional approaches (to these problems) won’t work. I think social entrepreneurs recognise this, and they are dedicating their time and their talents to solving these social ills. I think their success will determine how well we advance as species over the next century.

Is this groundswell significant movement, or is it simply fad?
I’m in the camp that believes we are at the beginning of massive movement. I think our best hope for the future lies with this group of dedicated people who are working to solve many of the world’s social problems. There’s parallel with 100 years ago when business, as we now know it, was starting to take root. Back then there was groundswell, lot of activity, but nobody formally examined the principles and underpinnings of what was going on. Around that time we began to see business schools and academic institutions take an interest in the field.
Look at the research done by Bill Drayton, leading social entrepreneur who founded Ashoka. He’s done some studies and it seems that non-profits are the world’s fastest-growing employment sector. In the US for example, the number of non-profit organisations has doubled in the past 10 years from 500,000 to one million. Even in the developing world, in country like Brazil, it has gone from about 1000 non-profits to one million over 20-year span. So the growth is huge and I think that people are starting to notice this. I don’t think it is fad.

Can you teach social entrepreneurship or is it innate in people?
There are examples of great social entrepreneurs who have come from the grassroots, not from study, and who have not tried to develop the tools and the knowledge structures with which they could improve their effectiveness. But they are few and far between.
Many of the most successful social entrepreneurs I’ve met have had at least some level of study in some area that has contributed

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