eBay Acquires Goldin From Collectors, Sells eBay Vault To PSA
Big news in the collectibles world as eBay sells off their Vault to PSA (owned by Collectors) and acquires Goldin Auctions from Collectors.
eBay Inc. (NASDAQ: EBAY), a global commerce leader that connects millions of sellers and buyers around the world, and Collectors, parent company of PSA, the leading third party authentication and grading provider in the collectibles industry, today announced they signed definitive agreements to enter into a series of transactions that include a commercial agreement, the sale of Goldin from Collectors to eBay, and the sale of the eBay vault from eBay to PSA...
...This partnership will also extend grading services to customers in the US through a simple and streamlined process, building upon the existing confidence buyers and sellers have in PSA’s grading expertise. Additionally, PSA will introduce a new service offering to allow customers to list and sell trading cards on eBay at the time a card is graded, accelerating time-to-market and quality of listing. Existing options for grading and sale will remain available...
...PSA has also agreed to acquire the eBay vault, while maintaining seamless access to vault services for eBay’s U.S. customers. There will be no immediate changes to the services provided for a period of time post-closing. After the deal closes, PSA will fold its existing vault services along with eBay’s vault program, into a newly branded offering with further details coming, including integrating selling and grading services.
While the acquisition of Goldin has been rumored for weeks, selling the eBay Vault as part of this deal is an interesting development.
eBay waived most fees for almost two years just to get the Vault up and running and they were set to finally start charging fees April 1, but that was pushed back - now we know why.
While all of that investment in the infrastructure to build a vault service may seem to have been wasted, it appears it may have provided eBay a bargaining chip in this acquisition.
eBay gets Goldin from Collectors, which plays to eBay's strengths in auctions but also adds a high end customer base that Goldin is known for that eBay has struggled to attract on their own.
And PSA (owned by Collectors) gets eBay Vault, which may or may not be very valuable for the assets it contains but conveniently knocks out a competitor to PSA's existing vault service while also unlocking new "synergies" where all cards in PSA's vault will now be able to be seamlessly listed for sale on eBay.
The timing brings up some interesting questions as well, with ex-Collectors VP of Marketing Mike Nett finally revealing last week that he has in fact been serving as the General Manager for Trading Cards and Sports Memorabilia at eBay for the last 6 months.
Liz Morton
Nett updated his LinkedIn profile in the last 24 hours to show he departed Collectors in September 2023, while also announcing his new role at eBay in a post on April 5, 2024.
Mike Nett
Excited to share that for the past six months, I've been serving as the General Manager for Trading Cards and Sports Memorabilia at eBay.
It's been an absolute blast diving deeper into the industry and leveraging my experience from Amazon and Collectors. For me, this is a dream job - I get to talk cards all day! eBay is committed to innovating for the hobby, and I'm thrilled to be at the forefront of this journey.
Investors and the SEC might be wondering what insider knowledge Nett may have brought to the table and what impact that may have had on any negotiations in this deal.
The situation could in some ways be reminiscent of when Scott Cutler (who joined eBay in 2015 as President of their StubHub subsidiary before being promoted to VP eBay Americas in 2017) left in February 2019 only to "suddenly" take on the CEO job at rival StockX a few months later, taking a chunk of eBay's sneaker business with him in the process.
While StockX played it off at the time that they had "poached" Cutler from eBay, the reality appeared to be that then eBay CEO Devin Wenig allowed Cutler to engage/consult with StockX while still a company officer.
In fact, both StockX founder Josh Luber and Cutler publicly gushed to media at the time about their long friendship since the site was launched in 2016 and that Cutler had been a "trusted advisor" since the beginning.
Grace Turner
“Scott and I met just two days after StockX went live,” says Luber. “His extraordinary background mirrors the unique business model we have built at StockX. He understood the power of a stock market of things and quickly became a friend and trusted advisor.
Over the three years that followed, as the business scaled rapidly, Greg (Schwartz, StockX co-founder and COO) and I had the idea that Scott might one day be the perfect CEO to take us to the next level. Then the stars aligned – the growth continued, we added three world-class investors to our team, and Scott became available. We weren’t looking for a new CEO, but this was a no-brainer.”...
...“I have known the company and the management team since the beginning and have been impressed by its unique market model in e-commerce and dramatic growth. StockX is revolutionizing e-commerce,” says Cutler.
As unsuckEBAY put it at the time, StockX's claims about the situation were more than a little misleading.
The timing of hiring Nett and this acquisition could get even more interesting as eBay's Mergers and Acquisitions due diligence, risk and disclosure practices are being looked at as part of a deferred prosecution agreement with the Department of Justice after being found criminally liable in connection to the 2019 cyberstalking of journalists Ina and David Steiner of EcommerceBytes.
Liz Morton
The deal hit eBay with a $3 Million fine and enhanced compliance monitoring requirements for 3 years, including a specific focus on M&A.
The scope of the compliance monitoring, coupled with a historic $59 Million settlement with the DEA and ongoing litigation brought by the EPA, suggests the Department of Justice and other Federal regulatory bodies may be concerned about a wide variety of business practices, opening eBay's entire operation up to additional scrutiny.
Those concerns may include apparent due diligence and disclosure failures in eBay's October 2022 acquisition of trading card marketplace TCGPlayer, which led to the formation of the first US labor union in eBay's history and the sudden departure of Chief Accounting Officer Brian Doerger last year, as well as broader questions about the significant strategy shift eBay has undergone with increasing in-house labor-centric authentication operations in the last few years.
The ongoing legal issues and increasing scrutiny of M&A due diligence practices were likely significant catalysts to Chief Legal Officer Marie Oh Huber announcing her departure and TCGUnion-CWA applying pressure to bring eBay to the table to settle Unfair Labor Practice claims.
Selling the eBay Vault may also be an effort to reduce scrutiny from regulators, especially since eBay is already likely to be in the hot seat over revelations they are competing directly with sellers on their own site under the TCGPlayer name without disclosure.
Liz Morton
A group of TCGPlayer sellers also raised concerns early this year about eBay's acquisition of the company, treatment of unionized workers, alleged retaliation against their selling accounts, and anti-competitive practices - concerns which are only bound to grow as eBay consolidates its hold over the trading card market even further.
What do you think of eBay buying Golding and selling The Vault? Let us know in the comments below!
