GameStop CEO Ryan Cohen's $56B Plan to Take Over eBay

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All-In with Chamath, Jason, Sacks & Friedberg 1h 3m 2 speakers 8 chapters transcribed 2 months ago
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What is the main topic discussed in this episode?

Ryan Cohen 0:00
Everyone hates GameStop and it seems like everyone in the media basically wants us to fail and wants them to succeed.

What did Ryan Cohen learn from building and selling Chewy?

Ryan Cohen 0:05
And you've got a board that's making hundreds of thousands of dollars a year. They don't buy stock with their own money. They end up showing up to a handful of board meetings and they're making a fortune. You've got a management team that is grossly overpaid. There's nothing more American than basically risking your own capital. So why does everyone want us to fail?
David Sacks 0:31
Applovin started with an $8 domain and no VC funding. They built anyway and became one of the largest ad platforms in the world. Now they're bringing that same engine to e-commerce through Applovin Ads. Your ads run inside mobile games, reaching over a billion people with full screen, distraction-free attention.

How did Ryan Cohen transition from Chewy to GameStop CEO?

David Sacks 0:46
The platform finds buyers and optimizes for profit. You set the target, it does the rest. A cookware brand doing $4 million tried Applovin ads, hit 16 million, turned profitable, and they're on pace for $80 million this year. Visit applovin.com slash all in to launch your first campaign today. Ryan Cohen, welcome to the All In interview. Thanks for being here.
Ryan Cohen 1:10
Thank you for having me.
David Sacks 1:11
I think it's been like a decade, which is crazy how old we get since you and I last had dinner in New York. This was before several chapters of your life unfolded. And it's great to be talking with you today. You're doing something really interesting right now, trying to acquire and run eBay, which obviously is a big story right now that takes us back 25, 30 years to the start of the internet. But I want to talk a little bit about your story first, if that's okay. And I'd love for folks that are watching this or listening to this to learn a little bit about you. and the journey you've been on that brings you to this moment. Maybe we can go back to the business you started, Chewy, if that's okay.

Why does Ryan Cohen want to acquire eBay for $56 billion?

Yes, definitely.
David Sacks 1:56
Yeah, well, maybe tell me why you started Chewy. How'd you get that idea, and how'd you get into building this business from where you were coming from at that time?
Ryan Cohen 2:05
We wanted to build something online, and we were about to launch an online jewelry website. did not know anything about jewelry, went to a bunch of trade shows, bought hundreds of thousands of dollars worth of inventory, built the website, had the distribution, and then I was shopping in a neighborhood pet store. I had a poodle and I was going every few weeks and just hit me on one of my trips that i understood the product much better it was a recurring revenue purchase the market was still fragmented the fact that there was still neighborhood pet stores at the time and they had not been disrupted by petco and pet smart was fascinating to me and then you had to eat you had amazon which was established and had pet products
Ryan Cohen 3:02
since the 90s but they hadn't really achieved real scale in the category so the vision was to replicate the same experience that i had at the neighborhood pet store but do it online and do it at scale and i looked at amazon's best practices when it came to supply chain so fast shipping having a great selection being competitively priced and then the experience at the neighborhood pet store of knowing the products really well. And it was easy to be passionate about the category because I'm a pet owner and everyone we hired were pet owners. And it was all about market leadership as a low margin business. Hindsight, not necessarily the best idea to go head to head against Amazon selling 30 pound bags of pet food, but we executed really well and we grew really quickly.
Ryan Cohen 3:58
And we had negative working capital. And so it was a business that was able to get billions of dollars in revenue and not consume a lot of capital.
David Sacks 4:07
How did you learn to execute well? So at the time, you had little business experience prior to that. How did you learn those skills?

What is Ryan Cohen's three-part vision for eBay?

David Sacks 4:16
What were the principles and the values that made you excellent at operating that business?
Ryan Cohen 4:22
I understood from the beginning that... The real competition was always Amazon, and they were world-class when it comes to supply chain.

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