Steve Woda's blog

Thank you buySAFE!

Today, I am starting a new chapter in my entrepreneurial story. It is with both a bit of sadness and a lot of excitement that I share with you the news that I have left buySAFE to pursue other start-up and entrepreneurial interests. In addition, I have joined buySAFE’s Board of Advisors so that I can continue to assist the company in whatever fashion is necessary.  Click here to see buySAFE's announcement on the buySAFE blog.

After almost nine years of building buySAFE, I am leaving the Company in very capable hands, with fresh funding, and the brightest future that the Company has ever had. It has been a deeply satisfying experience to create something valuable, and I want to sincerely thank our customers, our partners, my colleagues and the many investors who made buySAFE possible. I am obviously looking forward to my next adventure, but I am also very much looking forward to buySAFE’s continued success over the coming months and years.

I founded buySAFE after getting burned in an online transaction on eBay. As a student, I didn’t have any extra money to lose to ecommerce fraudsters, and so I decided that there had to be a better way to buy and sell products online. buySAFE was born!

This adventure started for me while I was earning my MBA at Wharton in 2000, and as with all start-ups, there have been huge successes and great challenges. For me, both have proven to be invaluable learning experiences.

Developing buySAFE’s early business/technology plan, acquiring our major financial institution and strategic partners (including two major strategic partners to be announced in the coming months), and raising our $30 million in venture capital financing were all challenges that I ultimately found to be great learning experiences. Over time, I was able to lead almost every aspect of buySAFE’s business operations, and all of these experiences were amazing for me personally and professionally. I plan to share with you many of the lessons I learned at buySAFE over the coming months.

Perhaps the thing I am most proud of at buySAFE is our team. Early on, I recruited Jeff Grass, Tim Woda, and Hans Dreyer to buySAFE. Today, Jeff is buySAFE’s CEO, Tim is the VP - Sales, and Hans is the VP - Operations. They are the core of our team even to this day. The rest of our team is amazing as well, and it has been a pleasure working with each and every one of them.

I never intended to spend almost a decade working on my Wharton class project, but along the way, buySAFE provided me with an amazing opportunity to make great friends, to learn important new skills, and to see that anything is possible with persistence and creativity. It also taught me that you can’t build a company by yourself.

Although I could never hope to name all of the folks that deserve my thanks, I wish I could. A few folks in particular - my wife, my brother, and buySAFE’s employees, customers, investors, and advisors - have all obviously been invaluable to both me and buySAFE. To all of you, thank you! I sincerely appreciate your investments in time, capital, expertise, and support. There would be no buySAFE without you.

As far as the next chapter in my entrepreneurial story, I am not ready to share the details quite yet, but please stay tuned. I will share my adventures with you here on my blog, so if you are interested, please make sure to subscribe using the form below.

Thank you buySAFE!

Related posts:

"Steve Woda, Founder and Chairman of buySAFE, Pursues New Entrepreneurial Ventures" on the buySAFE blog

"Founder of buySAFE, Steve Woda, Steps Down" on AuctionBytes.com

Shopping Advisor approved by Mozilla for Firefox

After two months of testing in Mozilla's developmental sandbox, Mozilla approved the buySAFE Shopping Advisor for public distribution via the Firefox Add-on site starting this week.

If you aren't already using Shopping Advisor with your Firefox browser, you should install it as an add-on today.  You can check it out on the official Mozilla Firefox Add-on site here... https://addons.mozilla.org/en-US/firefox/addon/9009

I am obviously excited about this big milestone, and as always, I hope you will continue to provide us with your feedback, insights and ideas on Shopping Advisor over the coming weeks and months.

Have fun, and happy new year!

Steve

Dancing with First Round Capital

First Round Capital's 2008 Holiday Card (video) proves once again why every early-stage entrepreneur wants to find a way to meet with this terrific investor group.  Check it out! 

These guys are creative; they have been in the trenches themselves (multiple times!); they have been successful (multiple times!); and most of all, they like working with entrepreneurs because they are entrepreneurs.

I have had the pleasure of working with and knowing lots of technology investors, and along the way, I have learned a thing or two about who you want to try and work with (and what you want to avoid).  These guys are good.  Period.  In addition, their holiday video is brilliant, low-cost, and fun, and it highlights their strengths in an intangible, yet powerful manner.

Let me share one quick story that illustrates why I like these guys so much.  Although they won't likely remember it, both Howard Morgan and Josh Kopelman provided me with a helping hand while I was trying to get buySAFE launched back in 2001.  I was introduced to Howard via a mutual friend, John Tedesco, and Howard offered to meet with me in NYC and provide me with feedback on my business plan.  At the time, the venture was called BondMyAuction.  I was not ready for primetime, and yet, Howard spent two hours listening to me and coaching me on how I could improve my plan.  Howard also introduced me to Josh Kopelman.  At the time, Josh was an executive at eBay because he had recently sold his business, Half.com, to the ecommerce giant.  For no reason other than to be helpful to me, Josh also spent almost two hours on the phone giving me feedback and advice on how to proceed. 

I will be forever grateful for their assistance since I was no more than an aspiring entrepreneur with a paper napkin business plan.  Their help was both gracious and inspiring.  In many ways, they (along with a few others like them) gave me the extra motivation and confidence that I needed to stick it out through the inevitable challenges of getting a business launched.  Since then, I have tried to return the favor with other aspiring entrepreneurs because of their good example (although I am quite sure that I could never be as helpful as they were for me).

Again, check out First Round Capital's holiday video, and I think you will agree with me.  These guys are authentic, and entrepreneurs clearly have good reason to want to work with them.

Nice job Howard and Josh!  For everyone else, enjoy!  http://holiday.firstround.com/

How Do You Win a Business Plan Competition?

The short answer is that you need to be very, very good.  There are a lot of terrific, aspiring entrepreneurs out there, and so a bit of luck is useful too.  Having said that, winning isn't everything. 

buySAFE is actually a product of the 2002 Wharton Business Plan Competition, but the plan was not the winning plan.  PayMyBills.com has a similar story.  The founders and my good friends, Jeff Grass and John Tedesco, were finalists, but not winners, in the 1999 Wharton Business Plan Competition.  However, they went on to raise tens of millions in venture capital and they built a really nice business in the process. 

Simply going through the business planning and critique process is the real benefit of these competitions in my opinion.  Business plans are funny things.  Business planning is a fairly simple exercise, but if you haven't previously developed a plan, the effort can seem very daunting.  Business plan competitions typically provide basic advice to the entrepreneurs on how to get started.  The competitions also have multiple stages with each stage presenting an opportunity to receive valuable feedback from the experienced entrepreneurs and investors that are judging and/or mentoring in the competition.

The following Business Week video does a nice job of covering the basics regarding what you need to know before submitting your business plan.

Winning a Business Plan Competition | The Businessweek Video Library

In the video, the University of Oregon's Randy Swangard talks about how to win that business plan competition -- what to keep in mind before you apply, and why it's sometimes better to come in second.

The Wharton Club of New York is running a business plan competition now, and here is all the information you need to enter as a participant.  I highly encourage you to participate if you can.

Also, you might find the following NY Times article interesting.  "Beyond Grades: Business Students Put Their Start-up Ideas to the Test" does a nice job of covering the ins and outs of business school business plan competitions.

Have fun, and good luck!

buySAFE Announces Several Key Syndication Partnerships to Reach More Merchants and Buyers

buySAFE continues to add lots of terrific partnerships.  Check out the latest announcement...

Obama is More Famous, But Paris Has a Better Energy Policy

Okay.  I couldn't resist digressing a bit today.

Paris might not be as famous as Obama, but she seems to have a better energy policy than he does.  She makes fun of the "white haired dude" as well.  This spoof is a classic. 

Nicely done Paris.  You're "so hot!"  :)

See more Paris Hilton videos at Funny or Die

Also, while I have you here, please check out buySAFE's new safe shopping tool, Shopping Advisor.  This revolutionary application is something that my team has been working on for more than a year, and the industry reviews have been tremendous thus far.  Of course, I would love to get your comments and feedback as well.

Here is the scoop... The buySAFE Shopping Advisor is a free browser plug-in that enables consumers to shop online safely and securely. The Shopping Advisor provides objective ratings on eCommerce websites (almost 400,000 as of this morning) so consumers have the information they need to make safe and informed online shopping decisions.  More importantly, Shopping Advisor provides exclusive access to a unique safe shopping channel where every purchase is guaranteed with a bond up to $25,000 and identity theft protected – at no cost.

Have fun, and buy safe!

buySAFE on YouTube in Football video

I just came across this video on YouTube about buySAFE, and I wanted to share with you.  I believe it was produced by a new employee on our team, and to be honest, I am pretty impressed with his creativity.  Clearly, it is an amateur video, but again, you have to love it when young folks take the initiative to use their skills in a creative manner.  Nice work.

Your commentary on the video are welcomed so feel free to provide comments!

Post Funding Advice for VC-backed Entrepreneurs

If you have ever raised venture capital, you know how important the post-funding relationship is with your venture capital investors.  Your pre-money valuation and financing terms are all important needless to say, but to be candid, the post-funding relationship you have (or are likely to have based on a VC's previous track record) is probably the most important issue for you to consider as an entrepreneur.

An experienced entrepreneur posted a great article on the subject on TheFunded.com, and here is an excerpt of the article...

There are a lot of postings here about getting the initial term sheet and getting the VC on board. However, just like marriages, many of these courting periods can be quite different from the month to month evolving operations and business that we face a year or two down the road. Remember that often these VCs will sit on your board, and direct your business in different ways and depending on your dilution can dictate how operational decisions should be made. Thus, it is important to get an early feel from your VC dialogue, especially how they would respond if the actual business is less than the wonderful picture we sometimes paint in our pitches.

If I can give you piece of advice that you need to follow religiously in your quest for venture capital, it is that you MUST speak to the entrepreneurs and CEOs that have previously taken money from and worked with the VC firm and the VC partner that you are considering.  Do not limit your discussions to the entrepreneurs and CEOs of the successful deals, but rather, you should talk to the entrepreneurs and CEOs of the unsuccessful deals as well.  In my experience, the VCs play a critical role in both outcomes, and you need to make sure you get the full, unedited scoop before you take money from a VC.  This is absolutely critical to your success or failure as a startup.

Speaking of which, I am always happy to share my insights on this subject with folks that are interested, so don't hesitate to email me with your questions.

You can read more of the original article here >> TheFunded.com: The post funding experience

Technorati Tags: Venture Capital,Post Funding Advice,Grotech,Core Capital,The Hartford Ventures,buySAFE,Steve Woda

buySAFE on TechNow

Here is a quick news story on buySAFE featuring both Jeff Grass, buySAFE's CEO, and Travis Brown, buySAFE's GC.  Nice work guys!

101 Five-Minute Fixes to Improve Your Web Site

At buySAFE, our web site is one of our greatest assets.  It is the main avenue by which we communicate with prospective buyer and merchant customers, partners, the media, and investors.  It is the main tool we have for defining buySAFE for the rest of the world.  It is the vehicle we use for creating action with respect to our unique eCommerce trust and safety and advertising services. 

I spend a fair amount of my time thinking about how to better leverage this asset, and then working with my team to improve upon its utility.

Therefore, when I ran across this article, "101 Five-Minute Fixes to Incrementally Improve Your Web Site" by Inside CRM Editors, I thought you would enjoy it too.  Here are their first 10 web site improvement tips, and if you are interested in learning more, you should definitely click through to read their other 91 tips as well.

1. Tell readers why they should perform a task. If your site is full of passive suggestions, toughen it up. People are trained to follow a request, as long as you give them a good reason to do it. 
2. Make the most highly trafficked pages easier to scan. If your current site consists of large blocks of text, break it up so that it's easier for the average Internet user to read. 
3. Convey a sense of trust. If you're experiencing skepticism, offer social proof like testimonials or risk-mitigating offers like a free trial. 
4. Stress benefits. Ensure that your copy always shows users exactly how your site will benefit them. 
5. Make headlines meaningful. Be sure to change any vague or cutesy headlines to something more up-front and meaningful. 
6. Repeat yourself. Check over your copy to make sure that you're really driving the point home by making it in a number of ways. 
7. Tell visitors what to do. Revise your site to ensure that people know exactly what the next step is. If you want a visitor to click a link, tell them 
8. Keep the reader engaged. Make sure that your current content gives visitors a reason to keep reading throughout the entire piece; otherwise, you need to spice things up a bit. 
9. Stay consistent. Check your copy for consistency, or else your site may be seen as unstable or flighty. 
10. Stay simple. Simplify your message simply to avoid confusing visitors, while at the same time improving conversion rates.

Read the other 91 web site improvement tips at "101 Five-Minute Fixes to Incrementally Improve Your Web Site" - Inside CRM >>>

Technorati Tags: Website Tips,Inside CRM

The eMarket for Lemons at The Wharton School

I had the opportunity to speak at The Wharton School, University of Pennsylvania last week about an article that Dr. Eric Clemons recently authored for the Journal of Management Information Systems, "An Empirical Investigation of Third-Party Seller Rating Systems in E-Commerce: The Case of buySAFE".  My presentation was focused on marketplace economics and specifically about information asymmetry, signaling, the "Market for Lemons" concept, and buySAFE.  In addition, I was able to share a few thoughts about my entrepreneurial experience with buySAFE.

As always, I had a great time as the guest of Dr. Eric Clemons, and I enjoyed hearing the passionate questions, insights and feedback from the students.  One of the students posted an article about my visit on his blog, The Un-Wharton. 

buySAFE is Hiring Talented Software Developers and Sales Executives

As many of you know, 2007 was an amazing year for buySAFE as we accomplished more than 100% growth for each of the last four quarters.  I expect buySAFE to continue to grow at a very fast pace in 2008, and so as you can imagine, that means we are looking to hire very talented people.  Specifically, buySAFE is hiring exceptional software developers (see the position description below) and sales executives, but of course, we are always interested in meeting talent across the board.

If you are a VERY smart person that enjoys BIG challenges and wants to work REALLY hard on a talented team to help build a great company, then you and I should probably talk.  Similarly, if you know someone that fits that description, please let he or she know that I want to talk to them as well.

The eMarket for Lemons and The University of Maryland

Last week, I had the opportunity to speak to a few hundred business school students at the Robert H. Smith School of Business, University of Maryland.  Michael Beveridge, buySAFE's VP of Business Intelligence, joined me in speaking at the invitation of Professors Guodong (Gordon) Gao, Peter Weiss, and Mingfeng Lin.  The students had previously read "buySAFE - Creating and Profiting From the Bonded Seller Advantage", a case study on buySAFE authored by Wharton professor, Dr. Eric Clemons.  Here is the presentation that Michael and I shared with the students... "eMarket for Lemons - The Economics of an Evolving eCommerce Marketplace".

As always, it was a terrific experience for me.  The students were extremely prepared, and they had definitely done their homework on buySAFE, information asymmetry, and the ecommerce marketplace in general.  If you ever want to get an excellent sense of how well your marketing efforts are working or how well you are educating the market about your solution, I highly recommend inviting a couple hundred college students to study your product or service and let them give you feedback.  I loved it!

Read more about Dr. Guodong (Gordon) Gao >>

A Few Interesting, Recent eCommerce and Entrepreneurship Articles

Good morning everyone!  If you know me well, you know that I am a voracious reader of anything and everything that I believe is interesting or useful either personally or professionally.  My colleagues will attest to the fact that their Inbox usually has at least one article that I have recent found that might be useful for them or buySAFE. :)

Today, I have been catching-up on my reading list, and I thought I would share with you a few articles that I found interesting.  Hopefully, you will some of the info interesting as well.

Steve

Build Buyer Trust to Drive Holiday Revenue

How can you drive up your holiday revenue?  Build trust with your buyers!  That's right.  By simply spending a bit of time and energy thinking about how your consumers do their searching, shopping, and decision-making, you can increase your holiday revenues in a material fashion.

On Wednesday, October 24, 2007 at 11:00-12:00 PM MDT, I will be giving an educational webinar sponsored by Infopia and buySAFE on the subject of building trust with your buyers to drive up your revenues and profits.

If you can spare an hour of your time, I promise you that you will learn something new and interesting.  If you are serious about building your online business, this will be time well spent.

Space is limited, so please register for the webinar as soon as you get a moment.  You can register at https://www.gotomeeting.com/register/890705170.

Related articles:
"Infopia Integrates with buySAFE" - Infopia Blog

buySAFE and ScanAlert (HACKER SAFE) Announce a Major Trust, Safety and Security Partnership

This week, buySAFE and ScanAlert, the provider of the Hacker Safe service, announced a huge partnership, and in my opinion, this is a great development for e-commerce.

Under the terms of the deal, ScanAlert will provide buySAFE's Certified Merchant solution for free to its merchants during the HACKER SAFE account activation process and from within the account management console.  In addition, buySAFE will make ScanAlert's PCI validation services available to its merchants for free as well.  This is truly a terrific combination for merchants and buyers.

Obviously, buyers want to find the right product at the right price.  Once that has been accomplished, buyers basically care about two things when considering whether or not to make a purchase online...

1. Am I going to get what I pay for?
2. Is my private information going to be safe?

buySAFE is the best in the world at making sure buyers will get what they paid for.  buySAFE does this by rigorously inspecting its merchants' sales experience, online reputation, identity, and financial stability.  Then, buySAFE monitors the merchant's transactional history, in real time, for any sign of transactional or business default.  Finally and perhaps most importantly, buySAFE puts its money where its mouth is bonding the transactions of buySAFE merchants up to $25,000 per transaction if requested.

Hacker Safe is amongst the best in the world at ensuring that buyers' private information is going to be safe.  They accomplish this goal by performing daily vulnerability scanning of their merchants' websites.  This helps to make sure that the merchants' websites are secure and difficult for bad guys to breach. 

Both companies are industry leaders in the online trust, safety and security world, and both have thousands of merchant customers using their services.

Again, it important for merchants to understand that their shoppers are concerned with two things...  and Will I get what I paid for, and is my private information going to be safe?   Optimal web site conversion metrics can only be achieved by answering both of these questions credibly.  Together, buySAFE and ScanAlert are a powerful combination that will benefit merchants, buyers, and the entire e-commerce industry.

Related articles:
"buySAFE & HACKER SAFE in a Ground Breaking Announcement - Enabling Risk-Free eCommerce" on the buySAFE blog
"BuySafe Partners with ScanAlert/Hackersafe and CRE Loaded" on AuctionBytes.com

Chicago Will Host eBay Live 2008

If you are an eBay fan (as I am), and you live in the Midwest, you will be very happy to learn that eBay Live 2008 will be held in Chicago.  eBay has not yet announced the decision, but Ina Steiner, a very authoritative source on all things eBay, has broken the story in her "eBay Live 2008 to Be Hosted in Chicago" blog post.

There are a number of major companies in the e-commerce ecosystem, both merchants and third-party service providers, that have decided to skip eBay Live 2007 in Boston in the interest of attending other prominent e-commerce conferences (buySAFE is one prominent example).  All of of us who own equity in eBay are rooting for them to regain their shine, and so perhaps Chicago and 2008 can be a resurgence opportunity for eBay and their ecosystem.

Scam of the Month - Judge Judy Punishes an Idiotic eBay Fraudster!

In this "scam of the month", Judge Judy takes on an eBay fraudster and ultimately hands out the maximum punishment.  In spite of the fact that this scam seems audaciously ridiculous, it is actually quite common online.  Bottom-line, there are a lot of folks out there that lack any semblance of a moral compass.

My inspiration for starting buySAFE was a similar scam that I fell victim to on eBay during the summer of 2000.  The only major differences that I can point to are that I purchased a $400 PDA, and instead of taking the scammer to court with Judge Judy, I decided to instead start a company dedicated to making every online transaction trusted, reliable and risk-free... buySAFE!

Next time, I hope these two innocent victims limit their purchases to buySAFE merchants.  It will save them a whole lot of anguish and effort!

Watch this video.  It is quite enlightening.

Related articles:
"Judge Judy Episode on eBay Trust & Safety" on Psychohistory blog

The Wharton School and Entrepreneurship

The Wharton Business Plan Competition took place earlier this month, and NP Solutions was the big winner for 2007. The new venture took home the $20,000 grand prize for a business that provides a polymer based injectable hydrogel treatment for back pain.  Obviously, I wish these folks a bunch of luck with their new business.

As you may already know, I am a big fan of these collegiate competitions.  buySAFE (formerly known as BondMyAuction) is a product of the Wharton Business Plan Competition, and so I can speak from experience when I say that these events can be very useful in getting entrepreneurial ventures launched.  I actually entered the business plan competition in 2000 and 2001 with different ventures as a student.

Then after graduation, I teamed up with Peter Niessen, a 2002 MBA grad, to enter BondMyAuction in the 2002 Wharton Business Plan Competition (You need at least one current student on your team to participate, but the rest of the team can be alums, etc...).  Peter was a terrific teammate, and he and I were able to make it to the Finals of the competition.  Again, it was a great experience, and you can read about it in this recent article by the New York Times - "Beyond Grades: Business Students Put Their Start-Up Ideas to the Test"

One last interesting note for you...

Jeff Grass, buySAFE's CEO, was also a finalist in the Wharton Business Plan competition in 1999 along with his business partner, John Tedesco (John is currently the CEO & President of Guardian Mobile Monitoring Systems).  Jeff and John launched PayMyBills.com shortly after graduation, and they ultimately sold the company to PayTrust in 2000.  Today, the company's service is owned by Intuit, and it powers the bill payment and management solutions for some of the country's largest financial institutions.

Needless to say, collegiate business plan competitions can provide aspiring entrepreneurs with a generous leg up on the formidable challenges of starting up a company out of school.  For me, the Wharton Business Plan Competition experience was invaluable.

eBay Merchant Economics

I recently asked Michael Beveridge, buySAFE's Sr. Director of Business Intelligence, to share with us some of the interesting eCommerce data that buySAFE has developed over the last eighteen months.  We consider data and analytics to be critical to buySAFE and our merchant customers' businesses, and obviously, every merchant is interested in having solid, reliable data on the ROI associated with buySAFE.  At the request of hundreds of our merchant customers, buySAFE has invested heavily into developing an amazing data and analytics platform that can deliver incredible insights beneficial to buySAFE Merchants.  We will be sharing some of our new insights with you over the coming months, and I hope you enjoy the content. With that intro, here is Michael Beveridge's first contribution to this blog...

Important eCommerce Trust and Safety Statistics

At the PESA Summit this past week, there was a lot of talk about how to improve e-commerce conversion rates. I believe there are three critical drivers for conversion: product selection, price, and trust. Each of these issues would provide substantial content for an article, but I thought I would dedicate today's post to a number of very important trust-related statistics.

If you have any doubt about the role of trust and buyer confidence in your e-commerce business success, please take a quick look at these stats.

• 55% of online shoppers say trustworthiness of the merchant is most important (vs. price, convenience, pleasure, other)
  (Source: Online Shopper Research Report, 959 respondents, August 2006)
  

• 65% of online shoppers buy only from sites they know and trust
  (Source: VeriSign Secured Seal Research Review 08/06)
  

• 72% of online shoppers are becoming more cautious when buying online
  (Source: Gartner Research, 5000 respondents, May 2005 survey)
  

• 73% of online shoppers are concerned about the item being misrepresented (inaccurately described, counterfeit)
  (Source: Online Shopper Research Report, 959 respondents, 08/06)
  

• 76% of online shoppers are worried about never getting their purchase
  (Source: Online Shopper Research Report, 959 respondents, 08/06)
  

• 81% of online shoppers are concerned about merchant return/refund policies not being honored
  (Source: Online Shopper Research Report, 959 respondents, 08/06)
  

• 84% of online shoppers are concerned about merchants not treating them fairly
  (Source: Online Shopper Research Report, 959 respondents, 08/06)
  

• 85% of online shoppers are concerned about identity theft
  (Source: TNS Research, 08/06) 
  

• And, amazingly, over 50% of all U.S. internet users still don’t buy online (even from Amazon.com!).
  (Source: Bear Stearns, September 2006)
  

With respect to this last statistic, "trust" issues are the primary driver of e-commerce non-participation. Amazingly, more than 50% of your potential customers will not buy online because they are nervous! Are you kidding me? That is a huge number, and obviously, the time has come for the e-commerce industry to take this issue seriously.

buySAFE and eBay Live 2007

It's official. buySAFE is going to throw a terrific event in Boston the second week of June.  However, the company has decided to skip exhibiting at eBay's annual conference, eBay Live. Instead, buySAFE has decided that it would rather participate in a number of other e-commerce conferences that it believes provide better return on investment including the huge Internet Retailer Conference in San Jose. You can read about buySAFE's eBay LIve 2007 decision on the buySAFE blog article - "Are You Going to eBay Live?".

I have a lot to say on this subject that I believe you will find quite interesting.  However, in the interest of time this morning, I will have to revisit my eBay Live thoughts in the coming weeks.  Please stay tuned.

See you in Boston!

Where Can You Meet the Largest Merchants on eBay?

Every couple of months, the Professional eBay Sellers Alliance (PESA) pulls together a collection of eBay's largest, most successful merchants.  These events are always terrific opportunities to meet experienced e-commerce professionals, and to get an insider's view of how the e-commerce market is developing.  Next week, PESA will convene its sixth PESA Summit in Chicago.

buySAFE has attended every one of these remarkable semi-annual events.  In fact, we have sponsored every PESA event since the organization's inception, so we are obviously a huge supporter of this organization.

Therefore, I wanted to give next week's PESA Summit a mini-plug.  If you are a professional merchant or simply interested in e-commerce because you are a member of the media, a financial analyst or a third-party service provider, you should attend this event.  You won't be sorry.  You will meet amazing folks and get the inside scoop on where e-commerce and eBay are headed.  Christie Hefner of Playboy Enterprises will be giving the Keynote Address.

As a side note, I will be speaking at the PESA Summit on an interesting panel of e-commerce experts including Jonathan Gariss (CEO for GothamCityOnline), Sloan Gaon (VP of Global Strategy for MIVA), and Jimmy Duvall (Director of e-Commerce Products for Yahoo! Small Business).  The Website Design & Web 2.0 panel should be very interesting, and I will provide a summary of the discussion on this blog after the event.

I am looking forward to it, and I hope you can find your way to Chicago for this terrific event.

eMarket for Lemons at Baruch College

I was recently invited by Dr. Karl Lang to be a guest lecturer at Baruch College on the subject of buySAFE and my experience starting an e-commerce business.  I always love speaking to folks about buySAFE and its important value proposition (Making sure that buyers get what they pay for, and that merchants get paid what they deserve.), but I especially enjoy speaking with college students (in this case they were MBAs) about what I believe is happening with e-commerce today.

As many of you know, I believe there is a fundamental problem emerging with e-commerce.  Specifically, the problem is that buyers have a very difficult time reliably telling the difference between good sellers/product and bad sellers/product.  In economic terms, this is called "information asymmetry".  Sure, if you are large, recognizable brand, buyers know they can trust you.  However, if a merchant is unknown to a buyer, how in the world can that buyer reliably figure out if everything is going to be 100% okay?  The answer is that it is very difficult for them to do so confidently.

When a marketplace suffers from information asymmetry, it inevitably develops into a "Market for Lemons".  You can read my previous blog post on the subject at "What is a Market for Lemons?"

Obviously, buySAFE solves this major e-commerce problem, and as of Q2 2007, there are thousands of online merchants that have signed-up for the buySAFE service in order to help mitigate this issue for shoppers.

I thought you might like to see the presentation I gave the MBA students at Baruch.  You can download the "eMarket for Lemons" presentation here, or you can view the presentation below.

I want to thank give a special thanks to Dr. Lang for inviting me to speak at Baruch College, and I especially want to thank the MBA students for their fascinating questions and additional insights.

buySAFE Founder Guarantees Delivery by The Washington Times

The Washington Times recently did a nice article on buySAFE, and of course, I appreciated the generous coverage as well.

"buySAFE Founder Guarantees Delivery" by The Washington Times

I hope you enjoy the read.

Related articles & blog posts:
AuctionWire
TMCnet

buySAFE on The Today Show!

The past few days have been quite exciting here at buySAFE.  Last week, buySAFE was featured on The Today Show.  The "Designer Duds: Fake or Real?" segment, reported by Today's consumer affairs reporter Janice Lieberman, discussed the growing e-commerce problem of counterfeit luxury goods.  As expected, buySAFE was showcased as a terrific solution to the counterfeit goods problem.

Counterfeit/fake/stolen goods are obviously becoming a major issue for e-commerce, but in my opinion, this problem is actually a symptom of a much larger, more important, fundamental problem... Online, buyers have a very difficult time discriminating good sellers/product from bad sellers/product.  The REAL problem is that the Web suffers from major information asymmetry issues.  That is why bad guys are successful at defrauding consumers. 

Please think about my diagnosis for a moment... If consumers could tell the difference from the good guys and the bad guys, would shoppers ever unknowingly buy a counterfeit item?  Of course not!  Fraud happens because of information asymmetry.

I think you will find the "Designer Duds: Fake or Real?" news segment very interesting.  However, as you watch this clip, please understand that the counterfeit/fake/stolen goods fraud problem is due to a more fundamental e-commerce problem... Buyers can't reliably tell the difference between the good guys and the bad guys!  In economic terms, this is called information asymmetry, and it is causing legitimate, professional merchants millions of dollars each and every day.

Kudos to Jeff Grass, buySAFE's CEO, for a job well done!

Related blog posts and e-commerce articles:
"Designer Duds: Fake or Real?" by Janice Lieberman on The Today Show and iVillage.com
"buySAFE Invited By the French Government to Help Stop Online Sales of Counterfeit Luxury Goods" by Travis Brown on the buySAFE blog
"eBay Bonding Service buySAFE Featured on Today Show" by Ina Steiner on AuctionBytes.com
"buySAFE Appearance on 3/20/2007 Today Show" on AuctionBytes.tv

Stop Worrying! How to Solve the eCommerce Trust Problem.

Jeff Grass, buySAFE's CEO, recently posted a comprehensive article on the eCommerce Trust problem, and how buySAFE is specifically designed to tackle this big issue.  Jeff does a great job of laying out the requirements for effective online trust and safety solutions, and I thought you might enjoy the read.

"Stop Worrying! How to Solve the eCommerce Trust Problem. (A must read if you sell or buy online!)" by Jeff Grass on buySAFE's blog

If you have any thoughts, insights, or comments on Jeff's article, I would be very interested in hearing from you.

France, Luxury Goods, and the Counterfeit Problem

Travis Brown, buySAFE's General Counsel & VP of International, recently spent a week in France as a guest of the French government.  The purpose of the trip was to learn more about the exploding counterfeit goods industry, and to explain how bonding merchants and buySAFE could significantly mitigate this  huge problem.

I found Travis' post to be one of the best I have ever read on the issue of counterfeit goods, and I am sure you will agree.  I encourage you to give it a quick read.

"buySAFE Invited By French Government to Help Stop Online Sales of Counterfeit Luxury Goods" by Travis Brown on buySAFE's blog

I am very interested in your thoughts and insights regarding the counterfeiting issue, so please share.

Related articles and blog posts:
"buySAFE Takes on the Issue of Counterfeit (Knock Off) Merchandise" by Fraud, Phishing and Financial Misdeeds

Wake Up With buySAFE on The Today Show

It’s been a lot of fun (not to mention a lot of hard work ;-) to see buySAFE grow from an idea in my head into a company that is changing the face of e-commerce. Knowing how far we’ve come makes it exceptionally rewarding when major, national news outlets cover buySAFE and the impact we are having.

One such news outlet – The Today Show on NBC – will be including buySAFE in a story that will run tomorrow, March 20 shortly after 8:00 a.m. Consumer reporter Janice Lieberman spent the day at buySAFE headquarters last week as part of a piece about the prevalence of counterfeit luxury goods being sold online. With consumers often unknowingly buying knockoff merchandise, it’s tough to know how to protect yourself from becoming a victim.

Fortunately, buySAFE solves this problem. By certifying that a merchant is trustworthy and reputable, identifying the merchant with the buySAFE Seal, and taking the extra step to guarantee the transaction, buySAFE ensures a safe, smooth transaction for consumers every time. Rather than worrying about having bought a fake, shoppers that buy from a buySAFE Merchant can rest easy knowing that they’re dealing with one of the safest merchants anywhere.

I encourage you all to tune in the Today Show tomorrow, March 20th at 8:00 a.m. to see how buySAFE is making e-commerce safer and more efficient for everyone involved.

What do Digg and eBay Have in Common?

Written by Guest Blogger, Lauren Davis - Georgetown Law student

What do Digg and eBay have in common?  Their rating systems are under assault by the fraudsters, and in some cases, this mischief is undermining the systems' credibility and effectiveness.

There has been a great deal of buzz surrounding a recent article in Wired magazine. The piece, entitled “Herding the Mob,” notes that online retail sites, such as eBay and Yahoo Auctions, and social bookmarking sites, including Digg, del.icio.us, and Reddit, share a common problem: the gaming of their community-based systems.

MySpace is Your Space. EverybodySpace.com

Written by Guest Blogger, Marc Morel - Director of Product Management, buySAFE

Web 2.0 has been ruling our world for several years now. We have all been posting, rating, blogging, podcasting, and commenting on everything from politics to the latest ball game we went to watch. This is power to the masses. And the world got better. But, did it really? I am not so sure...

The buySAFE Revolution?

Could 2007 be the year for The buySAFE Revolution?  I obviously hope so.

Brian Smith at Comparison Engines recently did a comprehensive post analyzing buySAFE's prospects in 2007, and I thought you might enjoy the read.

"The buySAFE Revolution - 2007" by Comparison Engines

Brian writes a terrific blog, and if you are interested in eCommerce, you need to regularly check out his insights.

We obviously have a lot of work in front of us, but so far this year, buySAFE has added numerous distribution partnerships that enable tens of thousands of merchants to use buySAFE.  In addition, some of the largest merchants in eCommerce are now using buySAFE on their websites.  I hope I can report back to you this time next year with news that 2007 was, in fact, the year of The buySAFE Revolution!

Related blog posts:
"buySAFE News Update" by Jeff Grass, buySAFE Blog

buySAFE for MIVA Merchant 5

Yesterday, buySAFE and MIVA launched buySAFE's trust and safety solution for all MIVA 5 Merchant customers.  This is exciting news for buySAFE, MIVA, MIVA's hosting partners, and most importantly, MIVA's merchants. 

If you are a MIVA merchant, you can begin using buySAFE on your website store with just a few minutes worth of effort.  Not only will you be able to drive up your store's conversion rates by bonding your eCommerce sales with buySAFE, you can use buySAFE for FREE!  It won't cost MIVA's merchants one penny to use buySAFE on their website stores. 

In addition, if you upgrade your buySAFE account from a Trial account to a Full account (it is still free!), buySAFE will pay you a revenue bonus on each and every bonded transaction going forward.  Yes.  You heard me right.  Not only is buySAFE free for MIVA Merchant 5 customers, but buySAFE will pay merchants to use buySAFE. 

Finally, James Harrell, General Manager of MIVA Small Business, also announced additional incentives of up to $5,000 for installing and using buySAFE.  Obviously, we seriously believe that once merchants try buySAFE, they will love buySAFE!

This is exciting news for MIVA because it provides MIVA's merchants with a proven tool for driving higher conversion rates and sales.  MIVA is dedicated to giving its merchants cutting edge services, and this is simply the latest initiative on their part to do that.

If you are a MIVA hosting partner (premier or standard), this is big news because the buySAFE for MIVA Merchant 5 product can provide a significant new revenue stream for hosting companies.  You should contact MIVA or buySAFE for additional details on how you can take advantage of this new revenue opportunity.

For buySAFE, this is exciting news because this morning thousands of MIVA merchants can roll out of bed and, with a few easy steps, activate buySAFE on their websites!  I think that is all I need to say.

Congratulations to the buySAFE and MIVA teams for a job well done.

Survey Reveals Shoppers Are Nervous

I often hear people suggest that since eCommerce is growing so fast, shoppers are obviously perfectly confident and comfortable shopping online.  In my opinion, that is naive, and it ignores the facts. 

During the recent holiday shopping season, a new survey was published confirming that consumers are, in fact, nervous shopping online, and that these concerns are growing, not abating.  buySAFE commissioned an independent firm, InsightExpress, to survey 1,000 random, online shoppers for their views on trust, safety, security and eCommerce.  The eCommerce survey reveals that small and medium-sized retailers without well-known brand names are the big losers when it comes to nervous shoppers.  More than 1/3 of shoppers, 35%, feel "unsafe" when considering purchasing from unknown retailers.   

International Visitors Drive eBay Traffic

This AuctionBytes article by Lissa McGrath is a couple of months old, but I find it to be quite fascinating. 

During this past holiday shopping season, about 70% of eBay's website traffic came from beyond the United States' borders.  Wow!  Obviously, the international Internet is the real deal in 2007.  I haven't spent any time independently analyzing this traffic data, but if true, it provides a fascinating view of how the eCommerce marketplace is evolving.

eBay and Seller Certification

Skip McGrath is the CEO of Auction Seller's Resource - a terrific newsletter for professional eBay merchants and for those folks aspiring to make a living on eBay.

Skip recently posted a series of interesting articles on the subject of seller certification on eBay.

Part 1
Can Seller Certification Bring Buyers Back to eBay

Part 2
eBay Selling Tools To Build Your Business by Preventing Fraud

Skip has done a nice job of laying out a number of things to consider, and I encourage you to give his posts a read. 

I believe Seller Certification is part of the answer for eBay (and eCommerce in general), but my big fear is that a bunch of eBay marketing folks will get together and roll out a new "seller certification" program, and that the program will fail to actually do anything meaningful for buyers or the economic health of the eBay marketplace.  Tough, effective "seller certification" programs actually require that you have to tell some sellers that they CAN'T be "certified".  In my experience, marketing folks don't like to tell current or prospective customers that they can't do business together.  Tough, effective certification programs are designed to limit the players on the field, and this is usually counter to everything the marketing folks think about each and every day.

Google's Universal Gadgets

Last month, Google expanded their Gadget product so that you can now add Google Gadgets to any web page on the Internet.  The Google Universal Gadget is a big step beyond the previous incarnation that simply allowed you to add the Google Gadgets to your Google Homepage and Desktop.  I didn't notice this improvement when it was first expanded, so I am bit late to the game.  However, I wanted to point it out to you because I love the product.

Interested developers can build Universal Gadgets by using Google's API, and then users can take the Google Gadget and put it on any web page.

Here is an example using buySAFE's Google Gadget.  All I had to do was go the buySAFE Shopping Google Gadget page, tailor the look and feel of the Gadget, and then cut and paste the following HTML code into my post.

<script src="http://gmodules.com/ig/ifr?url=http://www.
buysafeshopping.com/bss_module.xml&up_showSearch=1&
up_showCategories=1&up_showWatchList=1&up_searchTerm
=diamond&up_category=-1&up_lowprice=&up_highprice=&
up_sellerName=&up_sort=1&synd=open&w=320&h=450&
title=buySAFE+Shopping&border=%23ffffff%7C0px%2C1px
+solid+%23595959%7C0px%2C1px+solid+%23797979%7C0px
%2C2px+solid+%23898989&output=js"></script>

Voila! The buySAFE Shopping Gadget is up and running on my blog page.  Go ahead and do a quick buySAFE Shopping search via the Gadget below.  In my opinion, this is very cool.

It was very easy to create the buySAFE Shopping Google Gadget, and some developers are reporting that it can take less than 5 minutes to create simple Gadgets.  Check it out and have fun!

Related links:
"Google Universal Gadgets for your website released" by Jason S
"Add and Embed Google Universal Gadgets Modules to Websites and Blogs" by My Digital Life

The "Beltway Money Man"

Forbes Magazine recently called Core Capital's Jonathan Silver the "Beltway Money Man".  Jonathan is an investor in buySAFE and on our Board of Directors, and so I thought the article was a pretty interesting read.  Here is the link to "Beltway Money Man: Jonathan Silver".

buySAFE Announces New Partnership With Travelers

Today, buySAFE announced a new partnership with The St. Paul Travelers Companies, one of the largest financial institutions in the world with more than $113 billion in assets.

The new Travelers relationship adds another major U.S. financial institution to buySAFE's growing team of business partners.  The Hartford Financial Services Group and The Rutherfoord Companies are major investors in buySAFE, and in 2005, Liberty Mutual Insurance Company joined with buySAFE to provide significant surety bond capacity for buySAFE's rapidly growing business on eBay, Overstock.com, and TIAS.

eBay Feedback Farms Undermine Feedback Ratings System

Last week, Ina Steiner documented the basic story of 'Feedback Farms' on eBay.

I have to be honest, these scams continue to amaze me, and one has to conclude that these scams are damaging and undermining the entire feedback/merchant rating system.  If fraudsters can so easily create feedback/merchant ratings in the thousands, then buyers will have to increase their vigilance online.  From a buyer's point of view, it continues to be more and more difficult to truly discern good from bad.

What is a "Market for Lemons"?

I have had a number of eBay merchants write me about a post that I made earlier this week suggesting that eBay seems to be displaying the early signs of a Market for Lemons problem (Some would argue it is far beyond the beginning stages, but I will let you debate that with your comments below).

Without focusing on eBay or eCommerce in general, it has been requested that I illustrate a simple example of how a "Market for Lemons" develops.  Obviously, there is a lot of academic research on this subject (I posted a Wharton case study by Dr. Eric Clemons earlier this week, and you won't want to miss it since it discusses eBay's challenges in greater depth.), and almost everybody has heard the "Market for Lemons" term utilzed at some point.  Wikipedia provides a basic overview of the Market for Lemons economic concept, so I won't regurgitate what you can read elsewhere.

In short, the "The Market for Lemons: Quality Uncertainty and the Market Mechanism" is a paper written by George Akerlof in 1970 that describes what happens to markets that suffer from information asymmetry problems.  Ultimately, Dr. Akerlof won the Nobel Prize for Economics in 2001 (along with Michael Spence and Joseph Stiglitz) for his analysis of markets with information asymmetry.  While I was at Wharton, I was fascinated by the implications of this research on eCommerce marketplaces.

What's Wrong With eBay? It's Simple Economics

What's wrong with eBay?  Before I answer this question, you should download this Wharton case study by Dr. Eric Clemons of The Wharton School, University of Pennsylvania.  Dr. Clemons is one of the world's most renowned experts on information economics, and this case study is currently being taught at Wharton this semester.  It goes into great detail discussing eBay's current challenges, and I believe you will find it insightful.

Okay back to the question...  What's wrong with eBay?

Fall 2006 PESA (Professional eBay Sellers Alliance) Summit in San Francisco, CA

The Professional eBay Sellers Alliance (PESA) has announced that its Fall 2006 Summit will take place in San Francisco, California on 9/20/06 - 9/22/06.  I have attended three or four PESA Summits, and they are always fabulous events.  The attendees list includes many of eBay's largest merchants, and since most of them run fairly large multi-channel operations, these sellers also represent some of the most successful small and medium e-commerce retailers in the world.  Many of the largest e-commerce service providers will also be in attendance including eBay, Google, Overstock.com Auctions, Amazon.com, PayPal, buySAFE, ChannelAdvisor, and Infopia.  Therefore, the Summit is a great business development event as well.

If you haven't registered for the event, you should do so quickly.  The event is limited to the first 300 registrants.  You can register at PESA's website.

Top 10 Tips to Avoid Phishing Scams and Identity Theft

Earlier this week, I posted on the subject of eBay and PayPal phishing email scams.  It is impossible to completely protect yourself from the bad actors, but I wanted to share with you my recommendations on how to protect yourself from these types of scams.  The following are my top 10 tips on how to avoid phishing scams and identity theft:

1) Never click on the hyperlinks in emails
The text you see as an email hyperlink may be cloaked or hidden.  The cloaked hyperlink could take you to a website that you weren't planning to visit.  If you aren't completely sure of the source of the email, you should simply retype the URL directly into your browser.  This is one of the best ways to avoid fake hyperlinks and the threats associated with phishing emails.

buySAFE Hits the 3 Million Bonded Product Listings Milestone

There is big buySAFE news this week.  buySAFE passed the 3 million bonded product listings milestone.  The announcement was made on the buySAFE blog earlier this week.

This is exciting because it means that there are more than 3 million items for sale at buySAFE Shopping and bonded by buySAFE.  The Bonded Items can be found on eBay, Overstock.com Auctions, and TIAS.  In a few weeks, you will begin to see Bonded Items direct from merchants' website stores.  Obviously, the more Bonded Items avaiable for sale, the better the experience for shoppers looking to buy safely.  Therefore, this exciting news for everyone.

Congratulations to the entire buySAFE team!  Nice work.

The Virginia Joint Commission on Technology & Science (JCOTS) Cybercrimes Advisory Committee

I was recently appointed to the Commonwealth of Virginia’s Joint Commission on Technology & Science Cybercrimes Advisory Committee. The general purpose of the advisory committee is to study and advise on key cybercrime issues under consideration by JCOTS and by the Virginia legislature.

The focus for this year’s advisory committee is computer trespass and cell phone spam.
Specifically, we will be studying HB 254 (2006) and HB 1354 (2006) during the 2006 legislative interim.  We will work to determine what changes need to be made, if any, to further refine these bills.

HB 254 ammends the Commonwealth's existing computer tresspass statute by adding three provisions prohibiting certain forms of spyware. In addition to the three provisions, there was a proposed amendment exempting certain software providers from the three spyware provisions.

HB 1354 attempts to prohibit unsolicited text messages (spam) sent to wireless devices in the Commonwealth. However, both the CAN-SPAM Act and the Telephone Consumer Protection Act (TCPA) regulate certain types of messages sent to wireless devices. This advisory committee will need to determine what types of messages the state may regulate and if there is a sufficient need for regulation at this time.

During our first meeting in late July, the Cybercrimes Committee also discussed ideas on how to combat eCommerce fraud, pharming, phishing and MySpace.com safety problems.

I was very impressed by both the legislators and the citizen advisors. There are a lot of smart folks in Virginia thinking, proactively, about how to make the Internet a safer place for all of us, and I will keep you up to date on our work over the course of the year.

The Cybercrimes Advisory Committee consists of the following members:

Virginia Legislators:

• Senator Ken Stolle
• Delegate Cosgrove

Citizen Members:

• Michael A. Aisenberg, VeriSign
• Patricia Boggs, Cyveillance
• Charles Curren, AOL
• Steve DelBianco, Association for Competitive Technology
• Anne Gavin, Microsoft
• Thomas W.J.C. McCrystal, Creative Perspectives
• Russell E. McGuire, Virginia Office of the Attorney General
• Adam Ruttenberg, Cooley Godward
• Gerry Stegmaier, Wilson Sonsini Goodrich & Rosati
• Steven L. Woda, buySAFE

Related articles on the Internet:
AuctionBytes
AuctionWire

Nice mention of buySAFE on "Fraud, Phishing and Financial Misdeeds"

Here is a nice blog post about buySAFE.  "Fraud, Phishing and Financial Misdeeds" is a blog dedicated to educating folks about online frauds and the methods for protecting yourself online.  I read it every week, and if you are interested in what the bad guys are doing these days, this is the blog for you.

The "Steve Woda LinkedIn Profile" is up and running

I spent a few minutes today working on my "Steve Woda LinkedIn Profile".  I love LinkedIn, and I like the idea of having an online profile that folks can refer to if they want to get the basics on who you are.  I have to be honest though, there are too many of these things out there, and it will be nice when one company has become the defacto standard.

This ties into my favorite subject, portable trust and reputation.  The Wall Street Journal discussed portable reputation on 8/2/06, and they mentioned a few of the companies in this space including Trufina and Opinity.  This subject is going to get bigger and bigger this next year, and I expect buySAFE will be leading the charge with its portable trust signal, the buySAFE Seal.

Important Portable Trust & Reputation blogs:
buySAFE blog
Trufina blog
Opinity blog
Rapleaf blog

Congratulations to buySAFE's first intern, Mike Burke

Mike Burke was our first intern at buySAFE and ultimately, he joined our marketing team in 2004.  Mike was a valuable player on our team as he helped launch buySAFE Shopping - buySAFE's all bonded, comparison shopping engine.  Just before Mike left, he did this Squidoo lens on buySAFE.

This year, Mike decided to go Rwanda with his girlfriend to work at a orphanage.  Personally, I was disappointed to lose Mike, but I also thought this was a terrific opportunity for adventure that he could not possibly pass it up.  If you are interested, you can read about Mike's trip at Rwandan Journey.

I wanted to pass along my congratulations to Mike for successfully climbing Mount Kilimanjaro.  Nice job!

 

e-Fluentials are critical to your marketing success

Check out this terrific post on WOMMA's blog by Andrew Nibley, Chairman and CEO of Marsteller on the subject of how to leverage "e-Fluentials" to market and promote your products.

Andrew is exactly right.  My buySAFE experience has proven to me how important positive e-fluentials are for your business, and this is especially true when launching a new business in a new industry.  e-Fluentials are the folks that will educate the rest of the market on your product.  Just as important is the need to reach out and manage the concerns of negative e-fluentials.  It is obviously common that you won't agree with these folks, but their perspectives provide valuable learning experiences nevertheless.  I also believe these folks, if ultimately converted, will often become your strongest evangelists in the future.  At buySAFE, this has been critical.

Again, check out Andrew's insights here.