from The Daily Telegraph, March 18, 2006
Becoming a billionaire? Not on my list
By Andrew Cave
Craigslist chief executive, Jim Buckmaster, aims to offer a public service, not add zeros to his bank balance, explains Andrew Cave
|Craigslist CEO Jim Buckmaster: "All we have done is stop short of becoming insanely wealthy"|
Jim Buckmaster lives in a rented house, has never owned a car and doesn't want to float his internet company, although that would make him phenomenally wealthy. No wonder Fortune magazine pondered whether he was a communist. Is he the only chief executive in America who isn't obsessed by money?
"We are not so much anti-capitalist," says Craigslist chief executive Buckmaster, 43. "We're fortunate enough to have built a very healthy business, even though we haven't attempted to. All we have done is stop short of trying to become insanely wealthy. We have met billionaires and it sounds funny but it's not necessarily a bed of roses to have that kind of money.
"People with that kind of wealth have to walk around with bodyguards. Their friends and extended families look at them in a way they wouldn't necessarily choose. Their life becomes about figuring out how to employ all that money either by philanthropy or other means. So we don't consider it that revolutionary to have stopped short of that."
Craigslist, set up as a hobby by Craig Newmark in San Francisco in 1995, has had a transforming effect, however. Founded as an email events listing service, it's now the world's seventh most-visited English language website, enjoying four billion page views a month.
It operates 205 classified websites across the US and 35 countries, advertising everything from job vacancies to flats and lonely hearts.
More than 8m classified ads and 300,000 jobs are posted on its websites each month, attracting 10m users. In the UK, Craigslist's 12 websites are getting more than 10m page views a month, despite only launching in London three years ago. Yet Craigslist still has only 19 employees, including Buckmaster and chairman and "customer service representative" Newmark, operating from a house in San Francisco.
"We are so unlike the other top ten internet companies," says Buckmaster. "Most of them have tens of thousands of employees. We don't attempt to maximise revenues, hence we don't have sales, marketing, business development teams or advertising teams.
"We don't run banner ads or text ads or pop-ups. We have reversed the normal business model. The community of Craigslist is number one. Making money is number two."
Craigslist doesn't disclose its ownership structure, though eBay bought a 25pc stake from an unnamed former shareholder in 2004.
"We don't have an ambition to go public," Buckmaster confirms. "That would really distract us from what we're trying to do. Being badgered for quarterly financial forecasts doesn't jibe very well with our public service ethos. I don't really have material ambitions. I have no aversion to money, I don't think Craig does either we're just not willing to make any sacrifices with the way we run the company in the pursuit of money.
"We try to maximise social capital rather than financial capital. All basic human needs can be met through the site. Anything that can be found in a city can be found on Craigslist. We get emails from users who have assembled their entire lives from it; they have found their job and their spouse and their home and their furnishings and their cat or dog plus advice and tickets and everything else all through our site and all for free. That's a pretty powerful thing and people appreciate the fact that we don't charge them anything for it."
A free service run for customers rather than for personal gain? Hasn't Buckmaster heard of the American Dream? He smiles. "Maybe it's just a little bit different dream. We get a lot of personal satisfaction from all the thank-you notes we get from people. We have it pretty darn good. We just don't see any reason to try and put a bunch of zeros at the end of bank balances that are perfectly adequate.
"Craig has a relatively modest house in San Francisco and drives a Toyota Prius. I don't actually drive. I take the bus to work. I don't think the average person in the UK would find our lifestyles extravagant."
Craigslist only charges in three cities - asking for fees from companies placing recruitment adverts on its San Francisco, Los Angeles and New York sites. Is this business model sustainable? Buckmaster thinks so. Costs are kept low by using open source software such as Linux, which means there are no licensing costs to pay. The company doesn't want to employ many more staff.
"The model has basically been to do well as we can by our end users and keep everything 100pc free for them," he says. "We don't need any larger challenge than providing a platform through which all human needs can be realised across the entire English-speaking world. It is economics as if people mattered."
Fittingly, Buckmaster got his own job via Craigslist. "I put my resume on Craigslist in late 1999," he recalls. Craig saw it there and invited me for an interview. I had been doing web programming work. The interview was conducted on his living room couch."
Craigslist doesn't allow adverts for illegal substances or guns and has strict rules intended to keep the service local. However, it has run into a lawsuit from The Chicago Lawyers Committee for Civil Rights Under Law, a group alleging that discriminatory adverts were placed on Craiglist's Chicago website.
The suit challenges Craiglist's system of allowing its users to regulate the group's websites by flagging up their concerns electronically. If enough object, the item is automatically withdrawn.
"They're demanding that we manually screen the ads, which in our view would be a lot less effective than what we are doing," says Buckmaster. "There are tens of millions of users but only 19 of us."
He believes the suit will be dismissed, due to legal precedent that internet companies aren't to be held responsible for use of their sites. "A lot of things that have been alleged, you wouldn't necessarily find to be discriminatory," he says. "Some of them were about things such as ads saying that a flat was around the corner from a church, using it as a landmark.
"If the legal landscape should shift and companies like ours were to start being held responsible for each ad they host, that would have a devastating effect."
In the meantime, Craigslist is pressing ahead with plans to offer its first foreign language site, probably in French or Spanish. Chinese and Russian versions are a lot more challenging but Buckmaster hopes to offer these in time. Can he conceive of ever working anywhere else?
"I hope to live for a long time," he laughs. "That's a lot of years in internet time. But I certainly enjoy what I'm doing now. It's easily the best job I've ever had."