The original shorting of GameStop back in 2021 gave them a bit of a boost back into the green. While people were doing the GME to the moon, GameStop made more shares to sell, and paid off a bit of its debts, I think it made about a billion dollars in profit, they're still struggling, but it helped prolong their life.<p>A friend of mine also pointed out and this made it click for me that it makes 100% sense, GameStop is setup as a legal pawnshop in every state. So a pawnshop buying out eBay makes insane sense.<p>This merger in theory could be good for both eBay and GameStop if they don't mess it up. Imagine being able to list your eBay items locally without having to have people needing to come to your house, or better yet, getting a cut of what you wanted up front since they're basically a pawn shop, and then they list it on eBay and turn a bit of a profit with a local pickup option available.<p>I could see this working out decently, assuming the CEO of GameStop doesn't mess it up completely.
"I think it made about a billion dollars in profit"<p>It raised over a billion dollars of capital (i.e. issued shares in return for cash). It did not make a billion dollars in profit (and has never had a year when it did).
Key financial results for Gamestop from the recent fiscal year (2025–2026) include:<p><pre><code> Net Income: $418.4 million
Gross Profit: $1.196 billion
Total Revenue: $3.63 billion
Operating Income: $285.9 million</code></pre>
Operating income was $232.1 million, not $285.9 million.<p><a href="https://investor.gamestop.com/news-releases/news-details/2026/GameStop-Reports-Fourth-Quarter-and-Fiscal-Year-2025-Results/default.aspx" rel="nofollow">https://investor.gamestop.com/news-releases/news-details/202...</a><p>That total revenue also declined 5% YoY
The TLDR for people who don't intuitively understand why: existing shareholders are diluting their stake in the company by issuing new shares and getting money for those new shares. It's simply selling part of the company. Not profit.
> <i>GameStop is setup as a legal pawnshop in every state. So a pawnshop buying out eBay makes insane sense.</i><p>It doesn't though. eBay could easily set itself up as a legal pawnshop in every state if it wanted to. It doesn't because there's no advantage to doing so.<p>There are already third-party sellers in many areas who will take your physical merchandise and sell it on eBay in exchange for a cut. eBay doesn't need to enter that market, it's simply not profitable enough.
But the brick and mortar distribution is hard to build and gives a structural advantage. As another poster pointed out, you could sell your items locally and not need to deal with shipping, communication with buyers and other stuff. It would reduce friction which might actually expand the marketplace significantly. I personally have multiple family members that throw stuff away because listing on eBay is too hard and pawnshops too sketchy
There's friction though, if the process is under one roof end-to-end, ebay can take 30-40% (15-20% today) of every transaction by just letting you dump your old stuff. Might even eat FB marketplace and CL.
I thought the point of eBay was to get rid of that middleman. Wouldn’t that be something eBay would have done at some point if they wanted to own a pawnshop? Not saying that cannot work but that doesn’t sound like a genius idea
Over time, eBay has become the middleman - with international shipping centres, basically escrow service with buyer protection, and rather high fees for promotion and of course, the actual sale. No middleman is something like Craigslist or FB Marketplace.
eBay has also started doing strongarm middleman things as well.<p>If you list an item, it strongly "suggests" a price. Sounds innocuous, right? However, when every seller knows they would be stupid to list a product for less than the suggested price, that means that eBay is enacting a collusion process on their sellers to regulate prices for products sold on their platform.<p>I don't think this is illegal in any way, but it is bad for the buyers as it decreases the chance that they will get lucky with a purchase and ensures that all purchasers on the platform spend as much as they can afford to spend.<p>Next, as a seller, eBay presents you with an option to "promote" your product, for a fairly significant percentage of eBay's suggested sell price. (Last time I tried to sell something, they wanted $9.99 to promote an item expected to sell for ~$150, for instance). If you do not "promote" your item, then it is thrown to the bottom of the listing and may be filtered out when purchasers sort by "price low to high" as they often do.<p>I chose not to promote my item as I was just getting rid of it, (brand new OEM toner for a printer that normally sells for $200) and it got almost no views and ended up selling for $40, of which ebay took $7.50 for their cut.<p>I checked the other solds for the same product and mine was the lowest sold by almost $100 all seemingly because I didn't pay the racketeer price upfront.<p>I didn't care about the money, I was just getting rid of it, and ebay punished me for not playing ball their way while also losing out on their profits just to make a point with me.<p>If you don't eBay the ebay way you will suffer for it.<p>Speaking of which, eBay has started changing the number of results based on your search filtering, preventing purchasers from finding the specific thing they are looking for in exchange for something that is often more expensive and not quite right.<p>Try it yourself. Search for something very specific and then change your filters and see the number of available items increases and decreases based on how you search. I honestly would not be surprised if they were hiding the unpromoted less expensive more accurate item you are searching for from you in the expectation of inducing you to buy the more expensive item in the process.<p>Why would eBay do this? They make more money. It's pure enshittification. They charge the sellers to promote. They set the prices. They charge an insane percentage, something like 15-20% of the final sell price to the sellers, and they have made the platform hostile to its original purpose of being a bazaar for ordinary people to sell their old stuff to people that might want them.<p>Of course, they are still seller hostile, they protect fraudsters who buy expensive items and claim they are fakes or broken and return bricks, and they have strongarmed their customers into arbitration agreements in an attempt to prevent anyone from suing them to stop their anti-consumer practices.
Yeah, I got fucked over by eBay and will never sell on there again.<p>eBay let someone scam me out of $700.<p>I sold a Mavic 2 Pro drone with 5 batteries. The whole process was a mess. Scammer initially complained that it didn't come with a CrystalSky tablet that was in one picture (that was only added AFTER after he had bid already and asked to see Flight Logs, and was explicitly disclaimed as not being a part of the package, nor was it in the receipts I sent the buyer). After pointing out those details, silence.<p>Then, three weeks later:<p>"The batteries don't work. I want a refund."<p>"Batteries? Any of them? All of them?"<p>"All of them, none work. I want a refund."<p>Note that two of the batteries were less than 4 months old, still in warranty.<p>He then stated he wanted a refund of $800. For five brand-new batteries, that would only be $670.<p>No evidence was shown, despite multiple requests (like a video of a battery on a charger, or on the drone, failing to power up). I stated I'd like to get the original batteries back, as at least I'd be able to get them replaced under warranty or possibly repaired and recoup some of my money (I was skeptical there was -any- issue, but still, good faith). He "happily" agreed. I asked him to send me a message on eBay (so it was tracked and not avoiding their system) acknowledging that offering a partial refund was contingent on his sending me the batteries back and that he accepts me disputing the refund if not.<p>He sends a message indicating all of the above.<p>Refund is sent (for about $700, to include his return shipping costs).<p>Thirty-five minutes later, I get a message, "USPS says they don't ship damaged batteries, so I will not be returning them". (35 minutes? So what, you were just sitting around waiting for the refund, and then the very moment I sent the money, you jumped in your car, got to the post office, had this discussion, got home, and were able to send me this message? When your home address shows you about 15 minutes from the nearest post office?)<p>I then suggest we meet in person to exchange them (I live a few hours away, not convenient, but still, $700...). He umms and ahhs, "How will I be able to prove that I gave them to you in person?". I suggest we do it in a police station and point out that his local PD even welcomes people to use their lobby for CL, etc. on their website. More umms and ahhs. "I need to contact eBay support to see if they allow this." I point him to eBay's specific FAQ page describing exactly this and how they recommend doing in person sales, and refunds, documentation thereof, and how they support it. But he ignores that and says, "I never heard back from eBay support, so I'm not sure what to do". I point this page out again, and he goes silent.<p>I opened a dispute. No evidence was provided for damage or faulty goods, referenced the multiple requests for video, or of anything.) Multiple instances of the buyer trying to show something was problematic with the listing, not abiding by the agreement and refusing/avoiding any method of returning damaged items.<p>Overnight, no further inquiries.<p>"We have closed your dispute. Based on our review, the buyer is entitled to keep the partial refund for damage. He is also not required to return the damaged items".<p>So he ended up with a Mavic 2 Pro, with less than 20 hours flight time, 5 batteries, for in the order of $950, all told.
anecdotally; this is why I now use fb marketplace exclusively to sell stuff. cash only. meet in person; feel free to test / inspect stuff. All sales are final and are as-is.
Yea, buy on ebay either. It's all a scam now.
I think the difference is that GameStop already <i>has</i> this network of pawn shops, and those stores are doing enough business to justify their existence (at least somewhat; GameStop wasn't doing great before all the craziness). I could see something like the UPS kiosk in my local Walmart working; if you offered eBay returns at GameStop stores, you would be adding revenue without needing to justify an entire store to it like eBay would have needed to.<p>There's also the synergy that GameStop now has access to more used gaming inventory, a category that I'm led to believe is high margin for the stores.
> GameStop already has this network of pawn shops, and those stores are doing enough business to justify their existence<p>Gamestop closed 2,400 stores from 2020 to present, and operates just 2,200 stores currently. They'll continue to close stores as their revenue continues to shrink (down 60% in the last decade).<p>>used gaming inventory<p>physical used game inventory is a fraction of what it was a decade ago, and continues to shrink as a category, digital sales continue to climb and exclude Gamestop
Yes, exactly. In fact there were some ebay "helper" companies that made a go of it in the early 2000's. They went out of business because it doesn't add enough value. USPS created Media Mail and flat rate boxes, and UPS stores are found in nearly every community. They handle the hard part (shipping) well enough.<p>The only thing I can think of is Gamestop positioning to become a clearing house for fan swag or gaming items the way Woot is for Amazon overstock.
There's one of these near me in a shopping center with terminally low rents. I think the additional value add for these places is that a) they can help you price the item to move and b) they can wade through eBay support if things go wrong.
I remember one of these shops all the way back in the late 2000s. At the time I was confused about whether it was operated by eBay or a third party. It did not last long.
> USPS created Media Mail<p>Umm, that’s been around since 1938, which is a few years before the era you’re talking about…
<i>Yes, exactly. In fact there were some ebay "helper" companies that made a go of it in the early 2000's. They went out of business because it doesn't add enough value</i><p>It didn't add enough value back then, but IMHO it does now. Selling on eBay is a massive hassle these days for a variety of reasons, and much less profitable for onesy-twosy transactions than it used to be.<p>If I could just drop off a bunch of stuff at my local GameStop and forget about it until the checks arrive in the mail... yeah, there's definitely a business model there.
It disgusts me how eBay sellers abuse the US Post Office by stealing supplies. It’s one way to guarantee I never buy from someone again.
USPS is the only storefront I can think of that allows you to walk in, grab an unlimited amount of boxes/supplies, and walk out with no questions asked.<p>They will even deliver boxes to your front door, for free, by simply submitting a form online.<p>It's so easy, I'm not at all surprised that it's occasionally abused.
Then have to waste time to politely educate the sellers…<p>They wrap up the free priority mail flat rate boxes to obscure markings to send them with a cheaper service. So they know should they’re naughty but might not realize it’s reached the level of a crime, perhaps. Definitely didn’t realize they’d have customers who don’t like stealing from themselves (taxpayers)
Ah, so Catherine Keener's "We Sell Your Stuff On eBay" store from The 40-Year-Old Virgin is back, and now it's worth $55B. Always knew she was a visionary.
> and then they list it on eBay and turn a bit of a profit with a local pickup option available<p>Sort of wondering why nobody did this already. I know that the better charity shops do this with rare and unusual books/records. The UK equivalent CeX has an online offering through webuy.com, which appears to be a Chinese owned multinational.
This is called consignment and is an industry unto itself, usually for antiques since you need a lot of space. You give them your goods and they sell them. You get a cut if they actually sell.<p>I'm surprised nobody has really mentioned this in the thread. Does anybody remember the "trade in anything" day GameStop just had? <a href="https://www.usatoday.com/story/money/2025/12/08/gamestop-trade-anything-day-bobcat-goose-trade/87669769007/" rel="nofollow">https://www.usatoday.com/story/money/2025/12/08/gamestop-tra...</a><p>Obviously they're going to need to liquidate a lot of this stuff. It can be quite lucrative if done right. You're basically getting inventory for free.
Consignment doesn't offer the seller a very good monetary deal, though. They're essentially a junk hauler that might pay you a few bucks. We all have that pile of old computer components that we could probably sell piece by piece for $400 on eBay, $200 on Craigslist/FB Marketplace, $100 at a yard sale, and maybe if you're lucky a consignment place will give you a $40 for it all.
<i>> Consignment doesn't offer the seller a very good monetary deal, though. They're essentially a junk hauler that might pay you a few bucks.</i><p>You've just unflatteringly, yet accurately, described GameStop's business model for the past decade.
That isn’t consignment. Consignment means you own the item but they put it up for sale in their space. You split the income if it sells.
I mean $40 if you are lucky or goodwill. You could get more selling it “proper” but the transaction cost of it is super not worth it (for me). When I want something out of my house, I want it out of my fucking house. Listing it on Craigslist means I have to babysit it, handle questions, but worse… the fucking thing is <i>still in my house!</i>. And I was over that, whatever the fuck it was, like… a week ago. Now it’s just sitting there in my life cluttering it up. Better take to the garbage or goodwill. Then it’s gone!<p>At least with a consignment shop I will hopefully get something out of the deal.
> Obviously they're going to need to liquidate a lot of this stuff.<p>If you read online employees have talked about how they donated it or threw it all out, presumably there is very little of that stuff left at this point (and probably nothing left of any real value).<p>Ex: <a href="https://www.reddit.com/r/GameStop/comments/1qceolz/what_did_your_guyss_stores_do_with_all_of_the/" rel="nofollow">https://www.reddit.com/r/GameStop/comments/1qceolz/what_did_...</a>
The picture that comes to mind when i picture a GameStop/Ebay merger is that woman's store in 'The 40 Year Old Virgin'.
> The original shorting of GameStop back in 2021 gave them a bit of a boost back into the green.<p>IIRC, the short (borrowing stock, selling high, waiting for a downtrend, then buying low to pay back the borrowed stock buy an agreed date) was accelerating the fall of GameStop's stock price.<p>Then some Reddit knuckleheads noticed the hedge fund shorting GameStop was over-leveraged. They also found the deadline the hedge fund had to repay those shares to the bank.<p>The knuckleheads pumped the stock. Technical term: <i>I like the stonk.</i><p>The knuckleheads then bought and held GameStop stonks. Institutional investors joined in. The hedge fund was <i>legally obligated</i> to pay <i>any</i> price to buy back the shares necessary to pay back the loan by the deadline. So the longer everyone else held on to the stonk, the more the hedge fund would be forced to pay. Squeezing the hedge fund in this way caused the stonks' price to temporarily skyrocket. Technical terms: <i>hodl</i> and rocket emoji<p>The original Reddit knuckleheads eventually stopped hodl'ing and sold high.<p>IIRC the hedge fund eventually went under.<p>Unfortunately, like all things, the knuckliest of Reddit heads would keep hodl'ing all the way back to the ground[1], hoping to cargo cult another squeeze by building wooden towers and dirt tarmacs to entice the sky rockets back. I'm not a stonk hodl'er, but I'd guess <i>they</i> are predominantly the ones who provided capital for Gamestop to buy Ebay. It's probably the most expensive and baroque way to fund a new consignment shop in your home town.<p>1: is there an emoji for a rocket crashing toward the ground? If not, there should be.
Was this not lampooned directly in "40 Year Old Virgin" where a young Jonah Hill tries to buy some disco boots at an ebay store but can't because you have to go through the website.
thinking back to 2021 it really shows we need some reform around brokers being able to land their customers stock to short sellers without any kind of consent. Also same shares should not be shortable multiple times ...
The part you’re almost touching on but not directly mentioning is the trading card and collectible marketplace.<p>GameStop would probably be gone by now despite the meme stock if it wasn’t for trading card games and other similar collectibles, and eBay is very involved in that market.
> I could see this working out decently, assuming the CEO of GameStop doesn't mess it up completely.<p>So far he's failed to improve Gamestop's core business, which is still in decline, even with the memestock cash gusher.<p>No one goes into Gamestop anymore, and they won't start because of eBay.
Just bought a used switch there yesterday, 2 guys are selling or trading some kind of game card, kid and his dad getting a PS4... Like you say, no one goes to game stop anymore, it's too crowded ;)
>Like you say, no one goes to game stop anymore, it's too crowded<p>Must be why it's revenue is declining to it's historic 2006 level, because it's just too busy.<p>net sales 2016 $8.6b, 2025 $3.5b and still in decline
It creates the "Ebay Store" from the 40-year-old virgin makes sense if you look at it that way.
> or better yet, getting a cut of what you wanted up front since they're basically a pawn shop, and then they list it on eBay and turn a bit of a profit with a local pickup option available.<p>More than 10 years ago eBay tried to launch a program where they would buy your stuff and then list it themselves, but it didn't work out.
eBay is dying, new competitors are being created constantly, and the big ones like Poshmark are getting more North American buyers and sellers. eBay has barely grown since their post covid slump<p>Maybe eBay survives as an international site but even at that point, with $20B in debt this will just follow the regular PE playbook of shutting down after many layoffs and pivots<p>The entire concept of, "I have $1,000 in the bank, im going to buy a $10,000 company, but the debt will be on the companies name, not mine" needs to pass. Can you imagine if the mortgage was owned by our home, not ourselves. And we could stop paying it without any personal consequences<p>If you want to buy a $50B company, you should pay $50B (loans are fine, but not putting the new company in debt)
> Maybe eBay survives as an international site<p>I don't really know what alternative there is to eBay as an 'everything shop'. I can get specific screws there, or diff fluid, or a customised motorhome name sticker, or an old baseball cap for an airshow I attended in 2008.<p>And if I bought the wrong diff fluid I can sell it.<p>The main value over Amazon, though, is that the search works.
> The main value over Amazon, though, is that the search works.<p>Super true. You can actually search for the exact brand you want and not get a search result page full of brands XIAOLE, LLKAPOO, JEMROK, QPPNSS, VRINHH.<p>Also, I don't really know why, but I have much greater confidence on eBay that I'm not going to get something counterfeit or unsafe.
> I have much greater confidence on eBay that I'm not going to get something counterfeit or unsafe.<p>On eBay, sellers control their inventory, listings, customer service, and resulting reputation end-to-end. On Amazon, the incentives are backwards.
Facebook marketplace is an everything shop, though a bit more local in nature. Also, it's much easier for small businesses that ship to have an online store thanks to Shopify, etc.<p>The last few times I've used EBay is to get parts for old garden tractors, and even for that I've found cheaper options with small retailers that specialize in that stuff. Most ebay shipping pushes the cost up too much, and with the small retailers usually I can get a bunch of things I need at the same shipping price.
Interesting you think that because my main experience is the search is horribly broken and they do nothing globally to fix it. Most of it saved searches are full of exclusions because a positive search includes so many irrelevant items. And they don’t enforce categorization so listers constantly put in better categories for their items, when they aren’t just lying with things like “calculator not HP”.
> Can you imagine if the mortgage was owned by our home, not ourselves. And we could stop paying it without any personal consequences<p>To a large degree you can just stop paying your mortgage.<p>The biggest personal consequence is you will be evicted and lose both your place to live and any equity you built up.<p>The other main consequence is it will show up on your credit report for 7 years. Maybe some specific forms ask "have you ever been foreclosed on" in the future.
As a side effect of bailing out banks they have a lower risk profile than entities that don’t get bailouts. It’s essentially an additional subsidy on top of the already generous ‘money creation’ they’re allowed to do. It’s impossible to compete against this. The riskier the bets the stronger the subsidy so of course they’ll crank risk up to 11. Since the fate of banks and pensions are tied you can’t punish the banks without also punishing pensioners and pensioners are a strong voting block. It’s a distorted economic system that can only either crash or become more distorted. Since becoming more distorted enriches the already wealthy then that’s the only option that will be taken. The only thing that can stop it is to run out of resources to spend trying to save it. Importing a large number of foreigners is a rather creative (desperate) solution. I don’t know how long this will last but I’m confident I will see a major economic calamity in my lifetime.
Once you own the company you take out loans to pay a onetime dividend to you to pay off your purchase loans. Same thing perfectly legal
Who should take out the loan if not the new company? The old company? What would be the difference?
I mean I don't love eBay, but it's certainly not dying, where did you get that idea? Its revenue has continued to grow every year post-COVID, and competitors all face the central challenge of eBay's network effect.<p>It's not experience <i>massive</i> growth but that's because it's a pretty mature market by this point. People who want to sell their stuff already use eBay. It works. It's mature.
GME moon and all that in 2021 was financial engineering and mass media coordinated BS btw. they were all reporting it in same week with never seen details, with creating BS narratives. but you all consume and believe the details of it? good work by the engineers, nothing more.<p>Same for FAANG BS, ZIRP BS writing made by millions of bots online. Even before llms
Important background: <a href="https://investor.gamestop.com/news-releases/news-details/2026/GameStop-Announces-Long-Term-Performance-Award-for-Ryan-Cohen/default.aspx" rel="nofollow">https://investor.gamestop.com/news-releases/news-details/202...</a><p>CEO gets paid "only if GameStop achieves a market capitalization of $20 billion." Buying a $55bn company would certainly achieve that quickly. I'm not sure <i>how</i> they'd manage that (buy with what? Memes?), other than the should-be-illegal process of putting debt on the acquired company's balance sheet.
>>> should-be-illegal process of putting debt on the acquired company's balance sheet<p>This is a basically a leveraged buyout (LBO). All private equity works this way. Yes, it should be illegal, or at least heavily limited.<p>I highly recommend this book: "Plunder: Private Equity’s Plan to Pillage America"
I read that book, and my recommendation is to skip the third act, which is painfully repetitive.<p>In fact, coming from a finance background, I didn't find the book in general to be particularly insightful, and much more ragebait / policy oriented (which makes sense given the author was a DOJ Antitrust prosecutor)
This book got a unfortunate title. Private Equity can be a completely legitimate activity.
What it needs is some regulation on some underhanded financial tatics it uses, such as LBO.
I was curious about this, so I searched for the most authoritative study on private equity. Here’s what I got: <a href="https://journals.aom.org/doi/10.5465/AMBPP.2021.14309abstract" rel="nofollow">https://journals.aom.org/doi/10.5465/AMBPP.2021.14309abstrac...</a><p>This says that private equity effect on employment is neutral and efficiency is positive.<p>So what gives?
It's absolutely an LBO. The leverage is maximizing debt to equity. That debt is then transferred to the new entity.<p>It's how they destroy companies while making billions in private profit. They over leverage them. Accrue debts. Sell of equity. Wash, rinse, repeat until bankrupt.
On the bright side, if the plebs start making money through LBOs, they might finally find the will to regulate.
Is it still "private equity" if a public company takes a loan to buy another public company?
It's still an LBO, in effect borrowing against the target to get control of it.
OP is just saying that PE uses the same playbook, not that this move is "private equity".
I mean, it is functionally the same as home loans? Would you be proposing a carve out that buying a house or car is ok this way, but nothing else?
Say you take out a mortgage, then rent the house to a series of meth dealers to extract the rent while devaluing the property, and then default: you're still personally on the hook for any post-foreclosure deficiency judgment. One issue with LBOs is that, after extracting cash and fees, PE funds have various ways to extinguish liabilities that individuals don't, both by shielding the PE fund from debts and the use of bankruptcy and restructuring of the acquired company to discharge liabilities, including those from litigation.<p>There are various proposals to deal with this, but the most effective are probably imposing joint and several liability on certain kinds of litigation (breaking the "investor veil" and allowing rights of action against PE funds for the actions of their portcos) and limiting business judgment rule protection for directors and senior managers who approve LBO sales that are reasonably foreseeable to end in bankruptcy, which creates personal liability for fiduciaries. In other words, align the financial and personal interests of the individuals and companies involved with those of the acquired entity.
>you're still personally on the hook for any post-foreclosure deficiency judgment<p>Depends on the state: <a href="https://www.financialsamurai.com/non-recourse-states-walk-away-from-mortgage/" rel="nofollow">https://www.financialsamurai.com/non-recourse-states-walk-aw...</a><p>>both by shielding the PE fund from debts and the use of bankruptcy and restructuring of the acquired company to discharge liabilities, including those from litigation.<p>Who's extending credit to these companies? Individuals can do something similar by declaring bankruptcy. I think banks can be considered sophisticated enough that if they got hosed on a LBO deal, that it's hard to feel sympathy for them.
I mean, if I'm allowed to just make up silly hypotheticals, I can easily justify anything.<p>Say I raise money for a friend to buy a house and they proceed to rent it out to meth dealers. The friend is the one on the hook for the loans, of course; but would I not be on the hook for at least a reputation hit such that I can't do that again? Or do we think folks can get away with that sort of poor judgement forever?
In that sort of hypothetical the Mortgage bank is likely to take one look at your friend, see you with all the money for the down payment, and decide that <i>you</i> need to at <i>least</i> cosign the loan (if not be solely responsible). You <i>would</i> be on the hook for the reputation (and credit score) hit and certainly still paying off the rest of the loan or face foreclosure and possibly a criminal lawsuit for fraud.<p>Which yeah, leaves a lot of questions for why this is legal for an LBO. Where's the "credit score" hit on these PE firms doing LBOs? How is it that these investors are allowed to be their own mortgage bank, not require themselves to cosign the very loan they are providing the down payment equity for, and not be liable for damages such as bankruptcy of the entity they put on the hook for the loan?
If you give the friend the money as a gift, you have nothing to do with it, right? if you give it to him as a loan to inflate his assets and don't disclose that then you are committing a Federal crime.
I didn't give any money in that hypothetical. Rather, I convinced a lot of other people to give them the loan. That is, largely, exactly what fundraising is. You convince other people to give money to someone or something.<p>If people are regularly doing this at my request, and it is constantly going to someone that just burns the money, how are people still taking my requests?
It is a thorny question. The best way I can square the difference is that generally buying a house with debt is on the debtor and the house itself is collateral. The debtor can't pay back the loan the house is taken by the bank to be sold. Where as a PE leveraged by out the debtor is the target company. A company is different than real estate in that they are a legal entity that is now responsible to pay back a loan equal to their own value. The collateral is the business, but the business is now illiquid and has to sell of real assets and go bankrupt.<p>For example, Joanne's Fabrics was a profitable business with a fair amount of real estate. After PE bought them and was saddled with unreasonable debt they were in the red and had to sell all their stores. This removed useful and profitable business from the economy and sold off the assets in a fire sale. Where as me losing a house just means a bank now owns it and someone else can buy it. But if someone were to buy Joanne's they'd have to pay off the debt Joanne's owed for being bought and run into the ground
There is a long practice of having cosigners on home loans. This feels basically like that.<p>Which, granted, if you don't like the idea of establishing a company to take on loan responsibilities, I am not trying to offer a defense of that. Was a legit question of how you would structure it so that this is illegal, but home/auto loans are not.
A cosigner is different than what's happening in leveraged buy outs. A Cosigner is financially responsible if the debtor cannot pay back their portion of the loan. In a Leveraged buyout the purchaser does not take on financial liability for the debt, that is all placed on the company being purchased. This means that if the purchaser isn't even the cosigner in this scenario; the company being purchased is the sole entity responsible for repayment. So if GameStop goes through with this, but Ebay can't repay the debt than Ebay would suffer graver consequences than GameStop
But the biggest reason the purchaser does not have to cosign that loan is because in an LBO the purchaser is also essentially the mortgage bank for that loan. Should that be allowed?
Fair, but the nefarious scenarios people are talking about should at least be a major reputational hit for the people that did the fund raising. We are literally describing a ton of value getting destroyed. Someone is taking that hit.
It would be functionally the same as what you described if the parent company took on the debt, but that’s not how they do it. They make the purchased entity take on the debt. Hence why you often see mass layoffs in the company that was acquired soon after the deed was done. The company has so much debt it can barely function and the easiest way to pay some back is redirecting salaries at it.<p>Then once you realize why private equity firms do this, how their leaders have extreme monetary incentives to squeeze value out of companies in ways not limited to this, you realize why it’s insane how we have basically zero regulation on it.
Home owns are owned by people, not the home itself. If someone fails to pay a loan, their own credit score will be impacted<p>For these PE loans, its the new company that takes on the debt, not the buyer. Essentially any broke person can "afford" any trillion dollar company this way
Home loans are secured by the asset (the home). It's comparable to stock, but it's a less liquid asset.<p>Any broke person can afford a trillion dollar loan, if they can convince the bank that their house is worth 1.8 trillion dollars. But is that really possible?<p>Loan companies do due diligence so if GameStop is $A and eBay is worth $A + $B, then so long as $A/$B remains the same, the acquiring company owns two assets worth the full price of the loan.<p>It doesn't seem to be a scam to me. Am I missing something?
The difference is that when you buy a home the debt is in your name and you are required to pay it off. In a leveraged buy out wouldn't be to person taking out the loan, the debt is owned by the target of the purchase. If it were like a home loan and this deal goes south GameStop would go bankrupt and have to sell it's own assets to cover the losses. But in reality the debt from the deal would be owned by Ebay and if GameStop can't pay the loan back it'd force Ebay into bankruptcy and sell Ebay's assets. It's essentially a riskless move by GameStop and PE in general. Heads GameStop wins tails Ebay loses
There are other categories of real estate loans where the debt is against the property itself. The lender evaluates the property's income and expenses when underwriting the loan.
Fair point, it's a corporation taking out the loan so there's nobody to go after if the company goes under the way there is if the value of your house tanks and you stop paying your mortgage. But doesn't the bank take that risk into account when deciding whether to issue the loan? Why should that be illegal?
The way I’m reading your question, it seems like you are looking for the law to follow philosophically consistent principles.<p>That is simply not the case and lawmakers can make any kind of law to shape the society how we wish. If leveraged buyouts are creating problems for the country, then it’s totally valid to make them illegal in certain cases.
Leaving aside that the new company is the buyer; the point remains that home and car loans are leveraged loans. With the main asset in the leverage being that which is being bought. Defaulting on that loan results in the assets going to the lender.<p>If a lender builds a pattern of lending to people that can't make the payments, that lender will take a hit. If we think that isn't happening, why? And how could we return us to that?<p>Or, back to my question, how would you structure a legal framework where some loans can be done this way, but others could not? (I can think of a few ways, largely curious if I have a blind spot here.)
In a home loan, the borrower buys a house and pledges that house as collateral. The debt is the buyer’s obligation. The house does not have to “pay the mortgage” by laying off the kitchen, selling the roof, or cutting maintenance. The borrower uses outside income to service the debt.<p>In an LBO, a private equity buyer often buys a company using a large amount of debt, but the debt is typically placed on the acquired company’s balance sheet or serviced from that company’s cash flows. In effect, the target company helps pay for its own acquisition. That is the key difference.<p>In a lot of LBO schemas, the acquirer loads the target with, abusing leverage to maximize its returns, but this leaves the company with very little margin errors, any hiccup in the economy, and Kabum! The company goes under, an once viable company closes its doors, employees lose their jobs and local economies suffer. Meanwhile, the PE entity walks with as much cash as it could extract from the acquired company and debt-free.<p>Some PEs also go one step ahead, make the acquired company borrow more money, not to invest in the business, or restructure debt, but to pay a dividend to them.<p>In other cases, PE companies acquire a controlling block and then use it to make the company sell their assets to them, to be immediatelly leased back to the company. Then, there is also the practice of extracting all kins of "monitoring fees", "advisory fees", "consulting fees", etc. for services that are vague and frequently of questionable value.<p>PE companies also frequently engage in overly agressive cost-cutting to manipulate the EBITDA in the short run to sell the company at a appreaciated valuation, but hurting the long term value creation potential of the company and the quality of their services.<p>For PE, sometimes even bankruptcy is a business strategy.
Taking a $20b loan from TD Bank + sitting on $9b CASH + GameStop stock for the rest. They’ve made an interesting proposal around using 1600 GameStop locations for fulfilment. Smart if they can make it work.<p>Update: Numbers still don’t add to $55b - I think there’s a $14b shortfall. Not sure about how they are planning to fund that.
> They’ve made an interesting proposal around using 1600 GameStop locations for fulfilment.<p>Is that really an advantage? Fulfilment is always handled by a lot of places for the big e-retailers for returns, which is similar to what eBay needs for sellers.<p>How much does Staples charge for its Amazon return fulfillment where you don't even need to wrap up the item?<p>It is really popular: <a href="https://www.staples.ca/a/learn/amazon-returns-now-available-at-staples-canada-retail-stores" rel="nofollow">https://www.staples.ca/a/learn/amazon-returns-now-available-...</a><p>I question whether it is advantageous to use GameStop stores for this or just to piggy back on what Staples is already offering to Amazon and others for their returns? Fulfilling returns for Amazon isn't significantly different to shipping eBay orders.
My kneejerk is that most consumers these days expect delivery for items purchased online, and allowing them to pick up their items at a brick and mortar probably isn't the issue.<p>Now, dropping off items you're selling? That probably removes a decent hurdle for many first-time/one-time users who aren't familiar with shipping (what box/label/insurance/padding/...).
> My kneejerk is that most consumers these days expect delivery for items purchased online<p>100%.<p>> Now, dropping off items you're selling?<p>This is what Staples is offering to Amazon but for returns - quite similar. And they could offer them to eBay as well I am sure. You do not need your own chain of brick and mortar stores to do this and I am sure the cost per drop off would be cheaper with Staples than your own chain that only serves you.<p>GameStop is a game of constant pivots that sound good to its meme-believers that do not really work in the real-world.
> This is what Staples is offering to Amazon but for returns<p>Yes, and usps stores and Whole Foods do that for Amazon in the US as well. The difference is that each of those items don’t need to be individually packaged and shipped to unique locations. My local USPS put all the returns for the day in a giant bin and an Amazon driver picks them up.<p>I think the cost of labor and liability involved in having a local retail worker wrap, label, and ship every package would be an order of magnitude higher than shipping alone and destroy any value in offering it.
Sorry, are you saying that USPS cannot handle shipping across the country cost effectively? But somehow GameStop can, which has never done point-to-point shipping before?
Kohl's also has a returns arrangement with Amazon.
> Now, dropping off items you're selling?<p>A place that you could take items and have them packed and shipped for you would remove an enormous hurdle for new eBay sellers. It's easily the most annoying part of the entire process.<p>Hell, maybe they could even list items for people? Like a massive digital pawn shop.<p>I could see this really working out for them if they do it right.
Can confirm. The main reason why I don't sell stuff on eBay more is because of the high shipping costs and frequent scams.<p>Facebook Markerplace has issues of its own, but if you agree to meet up at a safe public location to buy/sell the item in person, then it mostly alleviates those two issues aside from the small chance of receiving counterfeit bills.<p>If Gamestop and eBay merge, then they could (potentially) offer a better deal to buyers/sellers by either buying certain items directly, shipping them at lower costs, or having an employee "verify" the item before it ships so that the seller receives better protections.<p>That's assuming that this is truly an ambitious merger rather than just being some kind of exit liquidity scam that gives Ryan Cohen a golden parachute right before he peaces out.
>Is that really an advantage? Fulfilment is always handled by a lot of places for the big e-retailers for returns, which is similar to what eBay needs for sellers.<p>I think the advantage is going to be "bring your junk to GameStop and an employee will put it up for sale and handle shipping"<p>You'd get considerably more trust buying something on ebay that at least some teenager looked at and verified was real and powered on, etc.
A company doesn't need $55bn to buy a $55bn company. They can issue new GME shares and exchange $EBAY for $GME. These are sometimes called "stock-for-stock" transactions
GameStop has a standing approved agreement to issue up to a billion new shares. If you read the offer you will see it is 50% financed by GameStop stock.<p>They threw him a hardball today in his cnbc interview on this topic. $GME stock value would plummet short term, but the combined company would revalue much higher.<p>Current Gamestop shareholders would be diluted. They would own, proportionally, a much small slice of the combined company, but at a higher price point.<p>The framing of this as, "Ryan Cohen is diluting Gamestop shareholders in order to meet the terms of his enormous pay package" is disingenuous though, as his pay package is all stock. He's diluting himself too. He obviously has faith that, long term, the value of the combined company can substantially grow.
If his choice is between not getting paid due to not meeting targets, and getting paid in diluted stock, then it’s straightforward enough.
>He obviously has faith that, long term, the value of the combined company can substantially grow.<p>Depends how much of them he has before and he will after, it might still be worth diluting if difference is vast.<p>Also, why long term if short term could also do?
Wouldn’t that debt knock down the market cap as much as the value<p>Otherwise take out a $20b loan and put it in the bank. Assets increase $20b, job done.
There is precedent for this kind of trickery being played.<p>For example, Honeywell acquired Garrett AiResearch, a well known manufacturer of turbochargers for combustion engines, through a series of mergers.<p>Later on, it loaded them up with debt (over $1.5 billion, mostly asbestos related indemnity obligations from other parts of the business), before spinning them out as an independent entity again. Two years later, Garrett filed for bankruptcy claiming it was succumbing to the unsustainable debt burden placed upon it by its former owner.
So you mean...marrying someone but transfer all the personal debt to the others, then divorcing so that I have no responsibility whatsoever? Not even an obligation to settle for the debt just like disappeared through an expired relationship?
I believe this is what they call the 'Texas Two-Step'
Perplexity wants to buy Google Chrome vibes.
They are paying half in GameStock equity. They will issue new shares so they will buy Ebay of $55bn, but add only $20bn debt.<p>Its good for GameStock management who will end up running a much bigger business. <a href="https://investor.gamestop.com/news-releases/news-details/2026/GameStop-Proposes-to-Acquire-eBay-at-125-00-Per-Share/" rel="nofollow">https://investor.gamestop.com/news-releases/news-details/202...</a><p>Game Stock management is essentially claiming that they can run Ebay better than the current management so Ebay shareholders will end up better off by selling to Game Stock: they get some cash and shares in a business that will be mostly a better run Ebay. Very possible bad for GameStock shareholders who will end up with a smaller stake in a bigger business.
It that's bad for GameStock shareholders, surely they'll vote against it?
It depends. If Gamestop is able to find the efficiencies that the CEO is claiming, EPS jumps between 50 and 100 percent. Gamestop shareholders get diluted down to owning a smaller piece of a much bigger earnings pie. That's if you don't engage in any conspiracy theories about how many shares retail traders <i>really</i> own (don't go down that rabbit hole).<p>Suffice it to say, the Gamestop's price floor has gone up each time it's been diluted in the past few years. Perhaps lower highs, but higher lows. And a company that can afford to try a stunt like this.
Well, his argument is that he can remove inefficiencies in the combined company.<p>GME is ~12B, EBAY is ~46B (58 total) with net income of 0.4B and 2B (2.4 total). If he boosts profit by 1.2B then it's nearly a 50% increase and probably going to result in a more valuable combined company despite the debt.
He can argue that. But to me it seems more likely that culture and market demands are so different between the two companies that sharing any substantial resources would be to the detriment of at least one of the two halves. And more likely detrimental to both<p>The most beneficial thing is how even proposing this shifts peoples' perception of Gamestop from a beloved but struggling brick and mortar chain to a successful business
the only benefit I can see is some kind of eBay pick up and verification scheme where sellers use the gamestop locations to send their products and buyers go theere to pick it up. That would basically create a "this is garbage feedback" that could cleanup some of ebay's long standing problems in trust.
While this seems like the perfect synergy with a company that has too many branches and not enough business, those branches are also tiny. I'd bet employees are not enthusiastic about becoming UPS.<p>Becoming Radio Shack / Microcenter, as far as 3D Printing and DIY electronics, seems like it intersects with their target audience more, but they're also probably pretty short on space for that.
<i>employees are not enthusiastic about becoming ups</i><p>Employee enthusiasm isn’t really much of a factor. For better or worse, in the event of significant change of the brick & mortar day to day operations then employee continuity & institutional knowledge is even less of an actual strategic asset than the minimal treatment it already gets in consideration.
> I'd bet employees are not enthusiastic about becoming UPS.<p>At the same time, most of the employees at my local UPS store have openly expressed a lack of enthusiasm about becoming Amazon returns employees.
yeah, their shops arnt sized to do much more than UPS style package movement.<p>I dont see it as a good value, but it's the only thing I see as a synergy. Otherwise it's just more garbage capitalism.
> to a successful business<p>Maybe from a brick-and-mortor store to yet another private equity fund whose continued existance comes solely from debt and merger trickery.
>GME is ~12B, EBAY is ~46B (58 total) with net income of 0.4B and 2B (2.4 total). If he boosts profit by 1.2B then it's nearly a 50% increase and probably going to result in a more valuable combined company despite the debt.<p>GameStop had revenues of $3bn last year and eBay was $10-12bn, so combined it's $13-15bn. A net income increase of 1.2bn on that gross is a tall order for M&A efficiencies. Especially difficult when the two companies have essentially zero operational crossover, besides business admin. It doesn't seem likely to me that merging eBay's accounting/legal departments into GME's (and similar efficiency gains) is going to save anything close to a billion across the two entities.
I don't think this is a serious assessment. For years, the core business of both companies has been facilitating the flow of used goods. Gamestop has moved strongly into collectibles recently, with a partnership with collectible grading firm PSA and the introduction of (essentially) lucrative trading card lootboxes, whereas eBay has capitalized on the same expansion of the collectibles market with new live/flash auction features.<p>IIRC, Gamestop recently had a "trade-in anything" day, where they accepted a variety of products for store credit. Seems an awful lot like this was some sort of test for accepting products in-store for eBay listings, or something along those lines. They already accept trading cards to send off to PSA for grading and to place into their lootbox system.<p>As far as efficiencies go, you can see things like shifting shipping by individual sellers to mass shipping to/from a warehouse, a much heavier footprint in collectibles, and perhaps quality control that reduces buyer disputes (this one's a bit iffy).
Well let's be clear, the "trade-in anything" day was a fancy discount day. They gave everybody $5 for whatever they brought in, online you can read from employees that they just donated or threw it all away, no attempt to actually keep any of it to sell.<p>That said IMO the biggest difference in the two situations you're describing is that EBay is not in the business of buying the items to then sell later, they just facilitate transactions between two parties and some of the logistics (depending on the seller). They're similar as far as dealing with "used goods" but the actual design of the business and risk being taken on is very different.<p>EBay also not really lacking what you're describing - there are fufillment centers that can be used for EBay listings, there's the EBay "Authenticity Guarantee" program for cards, they already own TCGplayer which does all of this for trading cards way better than GameStop does, etc.<p>Perhaps somehow these things could be improved by GameStop but I can't imagine it being significantly better than it currently is.
They are wildly different businesses. Ebay is not in the business of holding physical goods, they are a marketplace that connects buys, sellers, and shippers and adjudicates fraud, collects funds, handles taxes, etc. They are not a warehouse.<p>Gatestop is a retail operation that buys and sells goods. It takes on all the liability for fake products, it puts capital on the line to purchase used goods, it is a totally different (and worse) business
> Well, his argument is that he can remove inefficiencies in the combined company.<p>Sigh. The <i>synergy</i> argument, once again.<p>While historically most mergers don't work out particularly well, I'm absolutely sure this time will be different.
"How do you make money? Spinoffs, split-ups, liquidations, mergers and acquisitions." - Mario Gabelli<p>Just sample from these with replacement sufficiently many times and you're all set. At the very least, you'll owe people so much money that they'll have a massive interest in helping you.
Which is a laughable argument.
That is a massive “if”
Depends on how market cap is defined for the purpose of the contract. Typical definition is just against floating shares in the market * share price. Debt doesn’t factor in at all except in so far as it will influence investor confidence -> share price.<p>That said: conceptually it’s not an awful fit for GameStop. In so far as video games discs and cartridges were the main disposable belonging i had as a kid and the main target for new purchases, Funcoland was (later to become GameStop), if you squint your eyes, a brick & mortar eBay scoped to only video games. If you’d been an SV startup at the time pitching the eBay concept you could have said “it’s like funcoland, but online and for anything and also lets people sell peer to peer “
> the should-be-illegal process of putting debt on the acquired company's balance sheet.<p>I agree it's weird but ultimately the check against dumb lending is natural consequences for the lender, right? If you ask me for billions in loans for your zero revenue company and I give it to you, whose problem is that but my own?
In the modern world if you are a bank you will be bailed out eventually, thus your problem becoming everyone's problem.
The 2023 mini banking crisis has its own wiki page and it's quite informative. Of the three banks involved, one bank saw its shares drop 97%, another "shareholders lost all invested funds" and the third got auctioned off for pennies on the dollar. No investors were bailed out.<p>Banks go bankrupt all the time. Community Bank and Trust of West Georgia went bankrupt just 3 days ago. The Metropolitan Capital Bank & Trust that went bankrupt back in January. 99% of the time the investors are completely wiped out. Bailouts almost never happen, which is precisely why it's such big news when it happens.
Ah-hem SVB?
An outlier in historical terms (i.e. the last 20 years)<p><a href="https://projects.propublica.org/bailout/list" rel="nofollow">https://projects.propublica.org/bailout/list</a>
SVB was not bailed out. Depositors were made whole (as they should be), but shareholders were completely wiped out (as they should have been).
The lenders get their money back via management fees. Pretty much only the consumers and the employees get screwed over
The problem is that leveraged buyouts allow me to effectively inflict that debt on other companies, making a buyout offer the existing shareholders won't be able to resist and then reorienting its operations around servicing the debt I took out. In fact, lenders arguably <i>favor</i> this, letting me use the company I'm acquiring as collateral to acquire more debt at better terms than would otherwise be available.
It's the problem of all the employees (and potentially customers) of the company being plundered.<p>They have no say in the matter, and given that the lender can probably absorb the loss without, you know, missing mortgage payments or losing health insurance, I would absolutely argue it's not just their problem.<p>You can certainly hold the opinion that "it's just business" but it feels like an unnecessary part of business that very often has real disruptive and detrimental effects on average working people, for the sole benefit of rich people getting richer.<p>And yes I get that it's not just a PE problem, but PE is a big one of these kinds of problems.
The people who work at the bought-out company who will then be fired due to PE now gutting workforces to pay off the debt. Laborers are getting the shaft
If it was just you personally, sure. But a bank failure affects lots more people than just the bank.
Market cap will price in the debt, as it always does. Empirical evidence (dig through Google scholar) finds that cash assets, debt, profits, settlements, and the like, all are reflected in market cap changes at over 99% accuracy (the 1% is from measurement noise, so it may well be 100%).<p>Making debt of that form illegal would kill any company that needed money to stay afloat, such as during some emergency, or war, or COVID, or tons of events that companies regularly survive.
If the market is "efficient", then the debt should work against the market cap. For example if we assume a $50B offer at 50%/50% debt and stock, then we should expect the market cap to only increase by $25B. And for GME shareholders, they should expect their stock price to stay roughly the same because that $25B market cap would be offset by a corresponding increase in the number of shares. The debt would increase the enterprise value of the company, which is the more comprehensive metric to use when trying to value a company as it takes into account both debt obligations and cash on hand.<p>Of course the market may move the price up or down based on how much they like the merger. If they think there is some synergy here, they may move things higher. If they think the debt is too burdensome or have other issues with it, they will move the price lower. But all things being equal, any market cap increase of a buyout should be offset by the dilution that was incurred to finance the deal.<p>What looks like a "hack" here though, is that Cohen tied his incentive structure to market cap and not share price. The fact that his award is in the form of options and not RSU's does add some incentive for a higher share price, but at the end of the day, it looks like he can get 100% of his award by simply buying companies using dilutive stock issuance. Not sure how much the GME faithful appreciated that at the time of the vote. I think Elon did something similar in his incentive package.
Whether the acquirer or target borrows the money, this would not allow to increase the market cap of the company. It would increase the enterprise value (because the debt allows you to make a bigger acquisition), but not the market cap.
I’m disappointed and surprised you left out half of the conditions that grant him this compensation. You only included the one that suggests that all he has to do is buy a bigger company with GME stock. It was literally the first paragraph of your link:<p>“ The award is divided into nine tranches that are eligible to vest only if the Company achieves both a “Market Capitalization Hurdle” and a corresponding “Cumulative Performance EBITDA Hurdle”.”<p>This changes basically everything. He can’t just buy any bigger company. The company has to earn way more cash flow, cumulatively, as well.
The first two market cap hurdle is almost certain to be achieved, and the second should be easy (its less than current market cap plus value of new equity to be issued).
I was under the impression that it was either or, not both. Either reach market cap goal or EBITDA.
I’m disappointed and surprised you left out half of the conditions that grant him this compensation and only included one that suggests that all he has to do is buy a bigger company with GME stock:<p>“ The award is divided into nine tranches that are eligible to vest only if the Company achieves both a “Market Capitalization Hurdle” and a corresponding “Cumulative Performance EBITDA Hurdle”.”<p>This changes basically everything. He can’t just buy any bigger company. The company has to earn way more cash flow as well.
> other than the should-be-illegal process of putting debt on the acquired company's balance sheet.<p>This is silly. No different than buying a house w/ borrowed money based on using that house as collateral.<p>Banks aren't stupid. If it's very likely to fail and the interest doesn't cover the risk, banks won't risk. There's typically no upside to banks. At best they get their interest and at worst they lose everything.
> Banks aren't stupid.<p>Even a cursory familiarity with the history of the industry shows both that this is untrue but also that it’s leaving out many of the core reasons why finance is regulated. Bankers do make mistakes, but also their focus is on what makes them a profit now rather than what’s good for their client or the country long term. The bank does not care if GameStop goes bust as long as that happens after the loans are repaid or, most likely, sold. None of the guys who sold incredibly dodgy mortgages—if you weren’t in the market in the late-2000s, they would literally let applicants pencil in their income and not check it—went to jail for packaging those mortgages up so many times removed that they couldn’t reliably prove the loan even existed and reselling them with inflated ratings, and absolutely none of them had to repay their bonuses. Once they found a buyer for an “AAA” derivative, foreclosure was a problem for the retirement fund left holding it after a couple of sales.<p>That’s what I’d expect here, too: they’ll make some flashy announcements to juice share prices (“AI powered auctions paid in crypto!”) and sell that debt, spin whatever’s left into a subsidiary which splits off, and then profess complete surprise when that goes bankrupt.
> Even a cursory familiarity with the history of the industry shows both that this is untrue<p>The modern trend of believing that “history” is made up of one or two things that everyone saw on the news is actually really entertaining. Definition of “cursory understanding” tbh.<p>The banking industry, historically is far from stupid.<p>This particular story is just basic PR driven market manipulation and has nothing to do with the banking system.
> Banks aren't stupid.<p>If they can gamble with other people’s money then why won’t they.<p>If they can get rid of those liabilities by offloading them in a hidden way why wouldn’t they.<p>If it all collapses and the government bails
Them out, oh well.
It is different. You need somewhere to live. Buying a second home with what would presumably need to be at least a 90℅ mortgage is at best questionable.
Cohen is already rich rich, his GameStop compensation doesn’t really matter much. The eBay acquisition could be a strategy to juice his compensation but I think it is much more likely he does believe that he can achieve his stated aims, which will financially benefit him much more in the long term.
> Cohen is already rich rich, his GameStop compensation doesn’t really matter much<p>I think this argument is much stronger in the opposite direction: if his motivations were not focused on accumulating wealth, he’d be retired or running some kind of charity once he was that far past the point where he had to work. The fact that he’s not suggests that he derives his self-identity from wealth and the guys who do that are rarely satisfied at mid-tier rich.
I'm not sure the fact that somebody is already rich rich would make them less likely to perform ethically dubious practices to juice their own compensation. In fact I'd say the opposite is more likely.
Few CEO’s in the US are rewarded for longterm thinking when there are unsustainable quarterly gains to be made. GameStop also has a strange history, especially the last decade, that no one could possibly describe as “cautious” or “planning longterm.”<p>I also can’t name a single CEO who had the mentality of “I’m rich enough to make personal/financial sacrifices for the good of the company.” That’s simply not how things work. I’m sure an example exists but it would clearly be an exception to the rule.
If there's anything rich people famously hate, it's making more money.
Long-time ebay seller here. I'm seeing comments floating towards the top that are essentially positing that the physical GameStop locations can be used as hubs where people can buy or sell their stuff in general (especially items that are 'pick-up only'). A pawn shop, basically.<p>Thing is, GameStop is, well, for videogames and videogame paraphernalia. It's not a general store. Doing this would turn them into a thrift shop, not a pawn shop, as people are trying to offload their carpets, desks, etc - bulky stuff.<p>I don't think this makes sense.<p>This does make sense when you consider the collectable market, another domain I'm involved in. Trading card games, specifically pokemon, have exploded over the last 5 years. GameStop is making a killing off of buying, selling, and grading these cards. Ebay is the primary marketplace to buy and sell those cards. There's also tax free havens ("Vaults") offered by multiple companies, grading service passthroughs, and scalping offered through ebay too.<p>Viewed through the above lens, that's what's prompting this offer, I think.
I think a lot of people are missing that eBay bought TCG Player back in 2022. This would fold the TCG Player brand into GameStop. Many (most?) local game stores list their inventory on TCG Player. In addition to the physical stores themselves, GameStop would have their hand in nearly every digital trading card transaction. GameStop would own the TGC Player warehouses and inventory.
Numbers I see for GameStop collectibles revenue<p>FY2024: $718 million<p>FY2025: $1.06 billion
GameStop doesn't have (even close to) $55.5B. Their offer from the letter is literally impossible:<p>> Our offer is $125.00 per share, comprising 50% cash and 50% GameStop common stock<p>Even if you magically included all existing GameStop stock in the offer, it still would not comprise 50% of $55.5B.<p>EDIT: looks like it's not impossible and I misunderstood. It's a proposed change of leadership with a $25B injection of cash to sweeten the deal. GameStop would issue shares which would capture the original eBay value (since GameStop would own eBay after the trade), making that part a wash. At least assuming people owning eBay stock currently would value the combined company at at least the sum of their parts, which is a big if.
> <i>GameStop doesn't have (even close to) $55.5B</i><p>When the merger concludes, the former shareholders of eBay will have $27.5bn of GameStop-eBay stock and $27.5bn of cash. (“Cohen said GameStop has a commitment letter from TD Bank to provide up to $20 billion in debt financing” and “GameStop has around $9 billion in cash on its balance sheet to put toward a deal” [1].)<p>[1] <a href="https://www.wsj.com/business/deals/gamestop-is-offering-to-buy-ebay-for-56-billion-ceo-ryan-cohen-says-fd330f5a?mod=mhp" rel="nofollow">https://www.wsj.com/business/deals/gamestop-is-offering-to-b...</a>
Isn’t that just a <a href="https://en.wikipedia.org/wiki/Leveraged_buyout" rel="nofollow">https://en.wikipedia.org/wiki/Leveraged_buyout</a> ?
Yes. See [1] for an overview of how this works.<p>When the SEC filing is made, we'll get to see how the deal is structured. The $20 billion from TD Securities becomes a debt obligation of the combined company. There's a tax break in equity to debt conversion, and a second tax break for carried interest. [2]
There may be a preferred stock deal or debt refinancing so that TD gets their $20 billion back. Usually, the private equity firm exits within a few years.<p>[1] <a href="https://pubs.aeaweb.org/doi/pdfplus/10.1257/jep.23.1.121" rel="nofollow">https://pubs.aeaweb.org/doi/pdfplus/10.1257/jep.23.1.121</a><p>[2] <a href="https://www.pgpf.org/article/what-is-the-carried-interest-loophole-and-why-is-it-so-difficult-to-close/" rel="nofollow">https://www.pgpf.org/article/what-is-the-carried-interest-lo...</a>
That's just for the cash part. The stock part makes no sense. For this 50/50 deal to work in principle, they'd need to issue around a billion new shares, which would <i>massively</i> dilute the existing ~450M shares. So Ebay shareholders would suddenly own 70% of Gamestop after the deal. It's also highly questionable if investors actually believe the combined stock is worth that much, so the stock price would probably fall and turn those 70% into >90%. At this point it basically becomes a reverse acquisition plus a large loan for the final company from the cash part of the deal.
No, unless any control transaction using any leverage counts.<p>A third of the deal is financed with debt. A fifth is financed with cash. The bulk—fifty percent—is being financed with equity. An LBO would see debt and a thin tranche of cash finance the bulk of the acquisition.
The stock part is more like a merger than a buyout.
Yup.
I don’t understand why eBay shareholders will suddenly want GME memestock and find any interest in voting for this.
It's newly issued stock, a common form of making acquisitions cheaper
why do i keep seeing comments of this sentiment? can't they just take loans? I thought there were serious consequences to making an offer, and then backing out , especially if the other party accepts your offer.
It’s wild to me that you believed that they would make an impossible offer.
man, those GME bagholders are gonna love diluted shares.`
They already increased total number of stock by +39% in last 12 months, GME will squeeze the last penny from those people.
… and the stock has not dropped 39%, in fact it’s trading about where it was a year ago. Shareholders have been content to let Cohen add to the balance sheet, adjust operations and make a large move. This is one such move. And GME is up 5+% in pre trading, so shareholders are generally positive about this idea.
If Cohen's "large move" was to buy EBay, investors could have done that themselves. They would have gotten a better deal on shares in the new company. Also, they'd be up 50% over 12 months. Partly because Cohen "adding to the balance sheet" has meant dilutions, and there will be more for this deal.
Yeah this is the funny part to me - if you thought EBay was an amazing business then you could have just bought that stock months or years ago. Maybe the combined company will really be worth more than both companies individually, but for the most part this is just GameStop deciding how you should have invested your money months ago.
Technically, we only know that the marginal non-shareholder is 5% more positive about the idea, since the price represents what the marginal buyer and seller are willing to transact at. The only shareholders involved in the increase are actually selling.
the shareholders of GME operate under the delusion that there's gonna be another magic short squeeze.
Waiting for the MOASS… it’s coming any day now!
I operate under the delusion that it was a $400 gamble and there is no point selling stock that I forgot I even owned at all, when it's such a small amount.
Perhaps that is part of the scam here. Meme stock buyers will think this means something and will spend more on worthless shares so that ebay executives can sell.
They can sell now and pocket some extra money. What's not to like?
If bagholders were capable of buying low and selling high, they wouldn't be bagholders.
you think all the bagholders are in at the current price?
Have your ever heard of debt? They have a 20B line secured from TD.
Yes, that goes into the '50% cash' part of the offer. With a 20B credit line and 7.5B cash from their own coffers (which they claim to have, so let's believe them on their word there), you cover the cash portion.<p>The issue is the non-cash portion of the offer. They claim that the remaining 27.5B is covered by GameStop stock. But that's more than double the market cap of GameStop.
I’m sure if eBay wanted to build 1800 brick and mortar stores they could do so for less than twenty seven billion dollars.
With the approval of the board of directors (in most cases), a company can simply create new shares and give them to whomever they like.<p>I would guess that this information will bother you.<p>If it helps, because many public company executives are compensated on earnings <i>per share</i>, most C level teams are incentivized to buy back shares, thus decreasing the denominator for the EPS calculation without changing fundamental economics of the company.<p>If this also bothers you, you should guess what Buffet says and thinks about those two dynamics, and then read up on it, and you will learn something interesting about public markets!
You understand that the gamestop stock would then be owning ebay, thus be worth Ebay + Gamestops Valuation?
Alright, my company MEME offers to buy Apple then for $1 plus 100% of MEME's stock, which is worth more than Apple then since it will own Apple.<p>If you word it like this it's just a hostile proposed change of leadership. Weird way to apply to become CEO of eBay, but sure.
They would also be owning a company that now would have +20B in debt.<p>They now own ebay. They would include in that math 20B in debt plus Gamestop.<p>This sounds like a pretty bad deal for ebay investors.
Are they under any obligation to ground the value of their own stock or can a salesman simply claim that the "true" value of that stock is much much more than it currently seems to be?
Stock is worth exactly what people will pay for it. Ebay share holders get to vote to accept or reject this deal
Presumably stock market valuation is grounding?<p>Also, eBay shareholders can vote down the acquisition if they don't think the deal is good for them.
A lot of the comments here seem to assume that a smaller public company can’t acquire a larger one, which just isn’t true.<p>A quick search for how leveraged acquisitions, stock-for-stock deals, financing commitments, or tender offers work would answer most of the objections.<p>Is it too much to ask the Hacker News commentariat to do one quick search before collectively declaring that something they don’t understand is impossible?
There’s one comment as of the time of your post that makes this assumption - you could have replied to them directly.
I see a single comment mentioning it is impossible. No sign of a collective declaration. I think you’re overreacting
Example from quite some time ago: Avast buying AVG. The value of AVG was around twice that of Avast.
But if it all goes sour nobody will be held accountable and two not one company are ruined.<p>I don't see how such leveraged acquisitions should be legal.
Is there anywhere a good breakdown of these leveraged acquisitions. Like a video or something that breaks down how that exactly works and why its legal and why the acquired company goes along with it. Its seems like such a strange mechanism. And the history of it.
Why would it not be legal? You can take out any loan, so long as the creditor believes in your ability to pay it back with interest, which informs how it gets priced. This is basically Finance 201 and everyone is up in arms ITT
They better not ruin eBay, it's actually a useful business, I use it all the time
I imagine the vast majority of us do not have a problem understanding smaller companies can buy larger ones. Most of us are just incredulous that anyone is taking GameStop, especially Cohen, seriously.
Speaking as someone who used to know absolutely nothing about the world of high finance, yes, it is too much to ask.<p>Before I started paying attention to such things I wouldn't have known a single one of those terms to even begin googling.<p>And let's be honest here. A smaller company saddled with big debt buying out an even larger company really doesn't make logical sense. It makes <i>financial</i> sense, which is subject to different laws of mathematics, probably involving the waiter's check pad in an Italian bistro.
Agreed that Marvin would find this (and everything about Earth) ridiculous.<p>I propose this would make sense in the animal kingdom though; large, lumbering fatty walks along. It has big claws, but … it doesn’t look like it can be bothered to be dangerous anymore. Meanwhile a pack of hungry successful hunters walk alongside. To take this down, they will risk pretty much everything..<p>It’s the same story. The shareholders provide a sort of bet on if the big guy has still got it, or the risk-on hunters do.<p>That’s why the operational results got attention in Cohen’s letter — he’s telling Shareholders: “I turned around <i>GameStop</i>. I can turn this ship around, too.”
GameStop has zero debt and billions in cash on its books. It is not a stretch for them to be making this offer. It really does make sense here for both sides.
> Is it too much to ask the Hacker News commentariat to do one quick search<p>Are you new here?
> A quick search for how leveraged acquisitions, stock-for-stock deals, financing commitments, or tender offers work would answer most of the objections.<p>Isn’t the assumption that it’s impossible intuitively justified if you have no background in finances? A small fish usually can’t devour a bigger fish either.<p>Also, all those terms you mentioned mean nothing to me. You can’t search for what you don’t know exists.
As someone who's primarily used ebay to buy old NES et al cartridges, this makes sense to me. (No comment on the price being offered though)
This is just a leverage buyout and it will likely result in the slow death of both parties while there is value extraction for those in control. Think Sears, Toys R US and similar.<p>The CEO has a very specific deal where he gets paid significant compensation for specific valuations, which this is likely to achieve. That is value extraction at the cost of shareholders who will be on the hook for the leveraged loan and which will likely wipe them all out over time.
CNBC Interview with Ryan Cohen:<p><a href="https://www.youtube.com/watch?v=Bmj2PaxX24E" rel="nofollow">https://www.youtube.com/watch?v=Bmj2PaxX24E</a>
I believe ebay should put itself up for sale on ebay instead.
GameStop would buy it and then not even pay, then eBay would be like wtf now I have to relist myself
Auction or "buy now" with price suggestion?
2021: a Reddit short squeeze kept GameStop from going under.
2026: GameStop is bidding $55B for eBay, a company 4x its size.
If it lands, this might be the strangest full circle moment public markets have ever produced.
Is it still riding the meme stock wave or has GameStop made a turnaround?
I believe it is still a meme stock in the dark, "lose money quickly" corners of the internet.
Liquid Assets:<p>May 2020: $570.3 million<p>Jan 2026: $9.013 billion
Keep in mind, this is not because they turned the business around and made tons of money. Sales are lower now than in 2020.<p>Investors gave them this money; they sold additional stock to raise $3.47B in 2024, and another $4.2B of convertible debt in 2025.
Who would down vote this? It’s true.<p>Can people here really not keep their emotions in check enough to admit clearly obvious facts?
> Who would down vote this? It’s true.<p>It's not an answer to the question of a turnaround, and therefore low quality information? How much you have in assets does not correlate with the ongoing success of the business. Examining the day to day business of Gamestop and excluding the memestock shenanigans leaves a very bad business.<p>The core business has declining revenue - net sales 2016 $8.6b, 2025 $3.5b and still in decline. Cash flow from operations also continues to shrink.<p>Store footprint has shrunk.<p>The underlying business stinks, even if they made a ton of money selling stock, they haven't done anything significant to halt the spiral.<p>To the poster below asking if I'm drunk. Please provide some sort of revenue citation to 18x?
<a href="https://stockanalysis.com/stocks/gme/revenue/" rel="nofollow">https://stockanalysis.com/stocks/gme/revenue/</a>
The entire conventional zeitgeist is denying plain truths that hurt your self image.<p>It seems consistent that the same thing would happen here.
Another interesting observation to me is not that Gamestop was able to go from this full circle moment but rather the fact that Reddit has such influence that it was able to create the conditions which led here.<p>If Gamestop is the king, then reddit was the king-maker.
Very specific corners of the internet are losing their minds right now.
Many people noticed the math doesn't add up, e.g. in the CEO's interview here [0]. Am wondering if they are betting on the stock going up because of the news so they would then be able to fund the deal.<p>[0]: <a href="https://www.businessinsider.com/gamestop-ceos-awkward-interview-after-billion-ebay-offer-2026-5" rel="nofollow">https://www.businessinsider.com/gamestop-ceos-awkward-interv...</a>
I learned to programmed BASIC on paper long before I owned a computer. I knew I was going to get one though.
I've been with eBay since 2006 and have been consistently disappointed with their consistent failure to innovate. They need some inspired leadership.
If it means eBay stops front-loading every search I make with car parts in thier latest market 'pivot' I'm for it. They can dispense with shoving the tacky 'live auction' stuff and constant 'are you sure you don't want to sell something', even better.
Most business nowadays is related to financial transactions instead of building new products or services<p>The real economy seems to be burning but Wallstreet acts as if it didn't matter.
Data center build-outs and AI investments are huge. They make the combined numbers look almost normal, but if you're not in the data-center construction business, the US is already in a recession.
This was not on my bingo card. Not sure why eBay would take this personally. They've had a solid couple of years and there is room to grow. Gamestop on the other hand I'm not sure will exist in 10 years.
Not a headline I ever thought I would see. Kinda crazy how meme stocks and retail hype has led to this.
The offer letter: <a href="https://www.sec.gov/Archives/edgar/data/1326380/000119312526202468/d138475dex991.htm" rel="nofollow">https://www.sec.gov/Archives/edgar/data/1326380/000119312526...</a>
Is this going to turn Gamestop stores into something like those "sell it on Ebay" stores?
Man the business school case-studies must be getting stranger and stranger by the day. What's the headline for this one?
So they want to pay half of that with a meme stock?
So their crypto investment did not work out? Who would have thought! <a href="https://www.bloomberg.com/news/articles/2025-03-26/gamestop-to-borrow-1-3-billion-to-fund-bitcoin-buying-spree" rel="nofollow">https://www.bloomberg.com/news/articles/2025-03-26/gamestop-...</a>
Previous discussion: "GameStop Preparing Offer for eBay" <a href="https://news.ycombinator.com/item?id=47985271">https://news.ycombinator.com/item?id=47985271</a> 68 comments
<a href="https://archive.ph/CeCxv" rel="nofollow">https://archive.ph/CeCxv</a>
I guess if people use eBay a lot to sell used games then there is something of an overlap there. Otherwise, it seems pretty weird.
That sneaker company that pivoted to data centers set the 'weird' bar pretty high.<p>GameStop has physical stores so could be a place to send, collect from or even verify high value eBay items.
> ...sneaker company that pivoted to data centers set the 'weird' bar pretty high...<p>"Weird" is the wrong word for Allbirds. "Fraud" is far more fitting. They obviously have no intention running an AI-datacenter business and are doing it for the stock-price rush. A small number of people will be laughing all the way to the bank, and everyone will forget Allbirds in short order.<p>Ebay has a history of being legit, though they have had a long list of uncanny acquisitions themselves (including Skype, which they later sold for a stiff loss). It's a pity they couldn't just execute on their core business and are now being acquired themselves by an entity using sketchy financial shenanigans.<p>Who's going to stop a few rich people with a pile of money and a stated intent of doing something they have no intention of doing? No one, I guess. I mean, there's plenty of examples. Supermicro is still listed on NASDAQ even though one of their founders was caught smuggling export-controlled GPU's in Supermicro servers to the tune of 2.5 billion dollars a couple months ago.
Based on my own experience with GameStop, that will convince me to stop using eBay completely.
I'd be sad because eBay works great (even if their software is old and would need a complete rewrite).
You're saying your experience with GS is even worse than with eBay, right? How can it be?
EBay is running a platform (very successfully) not a pawnshop.
If I understand correctly, I think the collectibles market is more in line with what GameStop is looking at here. They recently got into the trading card game including grading services via PSA.
Everyone is taking this too far at face value. The purpose of this announcement is to pump GME stock.
With the state ebay is in, I'd welcome anyone else to run it
If they can do some accounting trickery to pull this off then they deserve it. Makes zero sense to me but I did not think GameStop had even close to that in assets.
There is no way that this deal will go through. However, it is good publicity stunt! Their offer is only 20% above the current share price, and they don't have nearly enough funding to complete the transaction. I would love to know what rate TD Securities is willing to lend? What would be the spread over 3month USD LIBOR? I assume 300-500 bps.
They're gonna have to sell ALOT of their NFT power packs
"I like the stock" - GameStop
GameStop is going to acquire BestBuy
Wonder what Shkreli thinks of this.
Can we please not? eBay is one of the few places I still enjoy on the web.
From storytelling to investor POV, does it a good story to frame this as entering the AI era through a digital service that everyone familiar with?
Every day our world is becoming just that tiny little bit more stupid
>55.5B<p>Is this offer on a timer?
Are there still large shorts on GameStop? If this goes through I assume it will wipe those out?
Diamond hands?
Is eBay just a hive of scams now? Try searching for a Mac Studio with 512gb of RAM for example. I know it's a highly sought after item, but there are so many sellers with 0 reviews supposedly selling these at suspiciously low prices. What's going on here?
I bought some dope weight lifting shoes last week. 46 bucks after shipping, 175 new. I’m pretty stoked on that. I was looking for a 3090 recently too and i did see the 0 rep sellers with buy it nows 10% under market value. That was a little sus. Nonetheless <a href="https://www.ebay.com/help/policies/ebay-money-back-guarantee-policy/ebay-money-back-guarantee-policy?id=4210#section1" rel="nofollow">https://www.ebay.com/help/policies/ebay-money-back-guarantee...</a> is a thing?
Same thing if you search for a PS5 Pro. And I have no idea how these aren’t taken down.
Great discussion. Curious what others think about the intersection of productivity and browser tooling here.
I was seeing the news about this calling it GameStop eBay takeover and I assumed it was eBay buying GameStop and I was like, huh that doesn't really make sense for eBay to buy GameStop but maybe they want the physical locations?<p>How the hell can GameStop buy eBay, this is insane.
Is it just me being ignorant and crazy, or does it make more sense for EBay to take over Gamestop, rather than vice versa?
How the fuck such a thing could happen in a sane world?
Please someone block this, they are going to ruin eBay.
Reminds me of Sierra On-Line being acquired by CUCk International in 1996.
The sad thing is it could succeed. This is exactly how Putin put the apparatuses of Russia into the hands of his allies. I'm sure GME will get administration support, any white knights will get Netflix treatment from the FTC. Cohen, as a loyal MAGA supporter, would then use Ebay cash to support Trump aligned groups.
is this for real? Or just to get gamestonks back into the news for another whirl on the wheel of meme?
Famous grifter Ryan Cohen is back in business. Time to collect more money from reddit
The Gamestop CEO is an interesting character, he grew Chewy and sold it, did a massive play on Apple stock during the pandemic and used that to buy a 9% stake in Gamestop over time, rode the hype to accumulate $9B while turning the company around and closing stores that weren't profitable and making it a money making budiness again. And now they already own 5% of eBay on top.<p>Along the way he says some ridiculous Trump stuff and wasted a bunch of time on NFTs but the eBay play seems interesting at least. It's one of the best internet soap operas to follow. For comparison AMC was put in the same "meme stock" bag at the time and you can see how they managed to ride the hype. So it's not just memes.
I look forward to today's Money Stuff!
He's a meme trader manipulating retailer investors, following Elon's footsteps
I mean he pumped and dumped BBB, and those people (or should we call them apes?) still love this guy.
those guys have a very strong track record of getting their way lately
> turning the company around<p>The revenue for Gamestop continues to decline, even if they are "profitable". The annual decrease in revenue continues. It's a dying business, it hasn't been turned around. The most charitable comment you can make about the company is that they've shrunk the business to align with their revenue decline.<p><a href="https://stockanalysis.com/stocks/gme/revenue/" rel="nofollow">https://stockanalysis.com/stocks/gme/revenue/</a>
[dead]
ebay is still "old internet", and genuinely useful and well built. enshittification is incoming...
Have you used eBay in the last few years? It's awful for sellers and awful for buyers. This is coming from somebody who buys on eBay twice a month on average.
It's not great for sellers either. I was banned during the time period before the Paypal divestment for having the galls to subpoena a nonpaying buyer's records. They take a cut from both sides. Sotheby's takes 10.5% (I think). eBay takes twice that for something comparable in value.
What would make it better? My only complaint as a seller is fees. I have no complaints as a buyer.<p>The best part is eBay works exactly the same as 10 years ago, as far as I can tell.
I try not to use it and then something will come up and I use it. Could be my market, or who knows what but there seems to be more scams.<p>It’s the only place someone can give you a fake tracking number (somehow people get these from UPS) get caught and other than a refund after weeks and a negative reputation ding, they get to keep on doing it. The fake tracking number scam has been going on for years too, it’s still happening. Permanently ban for people caught doing this, preferred shippers with eBay as a managed tracker or something like that.
I have never had this happen, but I don't buy from first-time eBay sellers. There are definitely scams on there, but they seem to be "too good to be true" prices with 0 reviews on the seller.<p>Surely you're not getting scammed by sellers with lots of reputational history?<p>I actually am more nervous as a seller, as their buyer protection almost always sides with buyers, at least in the US (and the fee is astronomical.)
Well, a month ago was my last use for about a year. A user with a 96% positive feedback and definitely a lot of sales slow played and then issued a fake UPS tracking number. The negatives in their history sounded mostly like communication issues so I assumed they were okay. They sell a lot of things in the $30-$90 range, this was a $200 item they had listed for $145, and they supposedly had a couple of them. A local store ran a sale around the same time that has it at $150 so it wasn't crazy. Upon deeper inspection of their reputation once things got fishy, they have 150+ sales, 4 negatives, 1 neutral. There are real looking positive feedbacks but about half are automated positive feedbacks. Not sure entirely what that means.<p>A refund has been granted but ebay's computers show that someone in my zipcode has also recieved a package (mine should have been 20lbs, the one sent was 2lbs and received by someone with a different name) so I'm kind of expecting a little more drama before it's all said and done. To be fully transparent, it was marked shipped without tracking and has an estimated arrival date of 10 days; after 10 days I asked if it had shipped and was told no and offered a refund and then it became marked shipped with a fake tracking number and "was delivered." The short of it is they're a somewhat prolific seller, I can't think of any reason it issue a fake tracking number and they had my money for about a month. I'm getting the money back but I'm back to square one. The sale at the local store ended.. It's not that big of a deal, just annoying.<p>It seems like there are sort of 2 classifications of bad experiences. There are poor descriptions, slow transactions, shipping mix-ups, mis-communications and things of that nature. A reputation ding is probably appropriate. Then there are more fraudulent things and ebay has chosen to not really punish those things and let them go, same way Amazon will gladly list and sell fake goods.
I use it more frequently than Amazon for used books and DVDs. It's cheaper and the sellers are often exactly the same.
It’s still way better than Facebook marketplace. At least eBay mostly solved the scam issue. Zuckerberg seems to desire fraud on his platforms.
And yet, it's still the place to go to buy anything secondhand or used. I'd go so far as to say eBay could be nationalized under the Defense Production Act due to the critical role it plays in manufacturing by keeping obsolete manufacturing machines running.
For an old internet company they sure know how to enshittify global selling with their Global Shipping Program also know as Global Shitting Program.
[dead]
[dead]
[dead]
[flagged]
GameStop is not a serious company and I can’t believe some people still buy in to their hype nonsense.
i don't understand why ebay looks SO terrible. It seems like some broken website where css failed to load.
I was just thinking how nice it was to still get used stuff on eBay and now Mr. McMemeStock is going to kill it to extract a few billion for himself.<p>Yay.
Gamestop is one of the companies that I refuse to do business with. eBay is a company that I am reluctant about, but use anyway.<p>If this goes through, that will be the final straw that gets me to stop using eBay entirely. That would probably be for the best.
its a fun place to buy games though
There is no valuable information in that comment.
Why do you refuse to do business with GameStop?
How come?