As eBay’s Meg Whitman becomes co-chair of Sen. John McCain’s national campaign, she talks to our Lesley Stahl about retiring from the business world and about her future. The following VII-part, exclusive interview took place on Tuesday, March 11. To read parts II through VII, click the links at the end of the article.
LESLEY: Meg Whitman is retiring after 10 successful – very successful – years as CEO of eBay, which Fortune Magazine said a few years ago was the fastest growing company in history. Faster than Microsoft, Dell or any of them. So now, Meg, you always said – always said – you were going to retire after 10 years. And I’m wondering why. Do you think that all CEOs should do that? Is it kind of like the presidency, kind of a way to cleanse and revitalize the system?
MEG: Well, I wouldn’t be so bold as to say all CEOs should stay only 10 years. But in our industry, the pace of change is so fast, the underlying technology changes so fast, and these companies are growing so fast, that I think 10 years is a good time to step back and say, “Would the company benefit from a fresh set of eyes and new leadership skills?” and “Would it be the right thing to transition to a new leader?”
LESLEY: Now, you also said, repeatedly, that you didn’t want to become a CEO of another company. Does that still hold?
MEG: It does. I think that in all likelihood, this will be my last business job. I can’t imagine a more fun business experience than the one I’ve had in the last 10 years; a more challenging, a more exhilarating business experience than I’ve had. So I think I will … you know, I’m not sure what I will do next. But it will be something that probably doesn’t relate too much to business.
LESLEY: Hmm. Well, I’m going to ask you more about that in a bit. But first, based on what I’ve read and what people say, you were a different kind of CEO. Obviously one suited to the digital world. But you’ve spent a lot of time creating communities on eBay. You ran a collegial kind of administration and you’ve been, some would say, incredibly accessible. And I’m wondering if you think there’s such a thing as a female CEO model? You know, we hear about the male model, but is …
LESLEY: … is there a female? And is this it?
MEG: I don’t actually think there is a female model for running companies. I think it is more personality driven than anything else. And I tend to be, as an individual, an accessible person. I like working in groups. I think that one plus one equals four, often if you have the right people in the room. And I like tossing around ideas, coming to a consensus, if we can. But at least hear all points of view and then make a decision. So in some ways I think it’s more personality driven and driven by where you were trained as an executive than it is male or female. So that’s probably what I would say.
LESLEY: Let’s go back to the question about what’s next for Meg Whitman. There are all kinds of stories floating around that you’re interested in politics and that you’ve actually looked into running for governor of California. You did support Mitt Romney. Might you think about going into the government of Washington? Tell us about you and politics.
MEG: OK. Historically, I have not been a very politically active person. I was a wife, a mother and had a full-time job at eBay, and other jobs. So I haven’t been looking for other things to do. But I got drawn into this presidential campaign because of my friend Mitt Romney. You know, I worked for Mitt for almost 10 years, and have known him for 25 years. And he came to see me in the fall of 2006, and said, “I’m thinking about running for president. Would you ever be willing to help?” And I said, “Absolutely I would be willing to help.” I had no idea what I was getting into, but I have such enormous respect for Mitt that I jumped in, and was actually one of his national finance co-chairs. I spent a great year with him helping him raise money, doing a little bit of traveling with him. You know, it was sort of my weekend job in many ways. And I liked it very much.
But, I will tell you, I’ve got lots of other things on my plate for the next couple of years. We have a family foundation that I want to spend some time in. It has money and it really doesn’t have the depth of mission statements and vision statements that it really should have. So I want to work on that. I will remain on the eBay board. You know, eBay is my first priority for 2008 in that I want to make sure this transition goes well. I’ll remain on the board and be helpful in any way I can.
LESLEY: But let’s get back to running for governor, or something like that, once you’re past 2008. Are you intrigued by it? Is it something you’ve got on your mind?
MEG: You know, I think I am much more interested in things philanthropic. I am interested in, you know, certainly helping the Republican party as we go into the 2008 election. You know, I’m interested in the environment, interested in education. So I think those are the things I am more interested in at the moment than elective politics.
LESLEY: Let’s talk about eBay, because it’s fun. And I’m wondering if you have, over the years, bought and sold things on the site?
MEG: Oh, yes. Of course.
LESLEY: You did? Yourself? Like what?
LESLEY: Like what?
MEG: Oh, gosh. Well I have a feedback rating of over 650, which means that I have bought or sold at least 650 items on eBay over the last 10 years. And it is everything from sporting goods for all of our family – any time we buy sporting goods, we buy it on eBay. We’ve sold sporting equipment on eBay, especially when the boys were younger. They would outgrow hockey skates, they would outgrow skis, they’d outgrow sneakers, they’d outgrow everything. You know how boys grow so fast.
LESLEY: It was like a revolving door with you. Buy it, it comes in …
MEG: … it would go out on eBay.
LESLEY: And when they’re growing, in about two weeks, right? What are some of the strangest things you’ve seen people put up for sale on eBay? I mean, you must be laughing half the time.
MEG: Oh, gosh. Well, one of the really fun things about eBay is the entrepreneurial aspect of the community that has … you know, really, they will put up anything that you could imagine for sale, whether that is a $4.7 million small jet, whether that is old silver that someone found in their attic, whether they’re funny things. There was a guy who got divorced from his wife and somehow in the divorce settlement ended up with her wedding dress.
LESLEY: Oh, no. He put it out there?
MEG: He put it on himself.
LESLEY: Oh, my God.
MEG: He did a video and sold it on eBay. And he got tremendous national news around this. He was called the “Wedding Dress Guy” and he was on all the major news outlets. It was hilarious. He had a little riff that went along with it about his wife and the divorce. It was very funny.
LESLEY: A lot of people who had just started selling things on eBay as a lark ended up quitting their jobs and turning this into their business – auctioning stuff off on eBay. Do they really make a good living just doing that?
MEG: Well, many people do, yes. We have about – around the world, about 1.3 million people make most, if not all, of their living selling on eBay.
LESLEY: More than a million people making their living just on eBay?
LESLEY: Now, maybe a lot of people know that. But I don’t. I find that stunning.
MEG: And there’s a reason for it. One is, you can be successful doing what you love. You are best suited on eBay if you pick a category or a class of items that you know something about. So maybe that’s high tech electronic equipment, maybe it’s audio equipment, maybe it’s Barbie dolls, maybe it’s collectibles, or a certain niche of collectibles, of coins, of china. And if you know a lot about something, you know how to price your items, you know how to merchandise your items and you can build a small business, really, starting out of a spare bedroom or starting out of your garage, with virtually no costs. Unlike setting up a store, where you have to rent space and pay heat and utility and light, you can start something and grow it at the pace you want to grow it.
We have lots of working moms who actually work on their eBay business between eight o’clock and three, when their kids are at school. Their kids come home and they’re done with eBay until the kids go to bed. And then they’ll do another couple of hours at eBay. So you can have tremendous flexibility. I mean it’s one of the great things about being a small business person in America: you can have some time flexibility.
LESLEY: How much can they make a year?
MEG: Oh, you know, people can supplement their income from several thousand dollars a month to … I think our top seller on eBay grosses $20 million.
LESLEY: A year?
LESLEY: A year. Wow.
LESLEY: Let me ask you about an issue I think everybody who’s out on the web cares about: privacy. I wonder what your thoughts are, having really been immersed in this for all these years now. What can sites, like eBay and Facebook, all of them, do to improve the protections on privacy for those of us who use the sites? Medical records are out there. Job histories are floating around out there, all in the space. What can be done?
MEG: … whether it’s Bank of America or eBay or the U.S. Treasury or whatever. And you must hire the people and invest in the system’s capability to keep your data safe. You must do very basic things, like encrypt every single credit card or financial instrument that you have. You can’t have encrypted data on the same server as you do basic information about your customers. So there’s this series, I would call it Security 101, that every company must invest in.
LESLEY: But you have to keep improving it because of the hackers.
LESLEY: It’s like an arms race.
MEG: It is an arms race. They get better, you get better, they get better, you get better. And, frankly, for a company eBay’s size, with the technology count that we have, I feel quite secure about the systems that we have around the world. But you have to be vigilant and you have to be investing in the new technologies because this is a problem that will be with us for the next 20 years. This is just a matter of doing business in an entirely new medium. And it’s incredibly important.
LESLEY: And you must have – I’m asking, this is a question – a whole budget item set aside just to keep up with the latest in security?
LESLEY: These walls get broken, you have to build them again. They get broken. It’s constant.
MEG: And you want people on your staff who can anticipate what the bad people are going to try to do and stop them. It’s a unique talent that every web company must have on their staff. And, frankly, every government must have. You might have read, about two years ago, that the government of Estonia had a security breach. And it was, I guess, some nefarious individuals who shut down the government for a day. And you can only imagine what would happen if that happened in the United States or France or Germany or Italy.
LESLEY: Or eBay – shut down eBay for a day.
MEG: You have to take it very seriously.
LESLEY: Sexism. Let’s talk about sexism. And this campaign, this very exciting campaign, plays out with Hillary Clinton running. Much has been written and much has been chewed over about sexism and misogyny, and what I keep hearing is a sense out there that racist comments and descriptions are verboten. But making fun of Hillary as a “hag” or “a bitch” or whatever is acceptable. What are your observations about that?
MEG: Well, on the campaign, I wouldn’t say that it is acceptable to make negative comments about women. But, you know, in some ways I am surprised, in 2008 in politics, how many negative comments are made about everything.
LESLEY: Yeah. Hello.
MEG: It may sound a bit naive. But I worked for Mitt Romney and he took tremendous – really quite pointed and negative comments – about being a Mormon. And in many ways it surprised me because this is 2008. This country was founded on freedom of religion. People came here because they wanted to get away from religious persecution. And they wanted to worship in their own way. So it was surprising to me how many negative comments were made about Mitt’s religion. You know, comments are made that I think are just inappropriate across the board.
I don’t know whether I would say people feel a little freer to criticize Hillary than perhaps Barack Obama. I just hope that over time we try to play to our better selves. I mean, one of the things that I think Obama has done nicely in his campaign is try to take the rhetoric to a new level. He’s tried to play to our better selves. I think that’s something that we should all aspire to.
LESLEY: Yeah, but it seems to be falling apart. You know, the old politics seem to be winning, no?
MEG: Mmmm, we’ll see. You may be right. And I think, frankly, members of the media can do a lot to call this out, you know? I think the media can do a lot to say, “Hey, listen. What kind of political system do we actually want here? What kind of rhetoric do we really want?” And I think it’s better, but we’ve got a long way to go. There’s no question about it.
LESLEY: You know, I feel that we’re living through instant replay, because I think that we do this every four years. Candidates say, “We’re not going to have negative campaigning.” They say it. It starts. And then we find out that negative campaigning works. And so, then, all the promises go away and they all do it because it does work. And then – we just saw it – we’re watching this play out right now.
MEG: Yeah. No, I know. And it’s …
LESLEY: … pathetic …
MEG: … in some ways. It’s disappointing.
LESLEY: Can we ask you a little bit about your personal life?
LESLEY: And I want to tell you something, because I’ve already read up on you and there is a very interesting parallel between you and me. That is, you were pre-med. When you were at Princeton you were working toward being a doctor.
LESLEY: Organic chemistry did you in.
LESLEY: OK. So pre-med went away. And you married a doctor.
LESLEY: Same story. I have identical –
MEG: Is that right?
LESLEY: Identical. Some day you and I will sit down and talk about this. But here’s what I’m interested in: you married a brilliant brain surgeon, right?
LESLEY: He was really chugging along in his career. He was head of the brain program at Mass General Hospital, maybe the …
LESLEY: … finest hospital in the world.
MEG: The abbreviation is MGH – Man’s Greatest Hospital.
LESLEY: OK. Perfect. Exactly. But now your career started to take off and I wonder what happened with him? Did he move with you? Did he give up his job to move with you? How did that dynamic work and how has it played out?
MEG: We have been a dual-career couple since the day we got married, which was June 7, 1980, and have really traded off opportunities over the years. And you will relate to this, Lesley. You know, for the first 10 or 15 years, we used to say that we took turns sabotaging each others’ careers. Because when someone would get traction doing something, then the other one would say, “Oh, I’ve got a great opportunity in Los Angeles or Boston or whatever.” But when I was offered the eBay job, my husband was running the brain tumor program at the Mass General and I was at Hasbro down in Rhode Island. And we had a great life in Boston. He loved his job. I loved being at Hasbro. I worked on Mr. Potato Head and some other fun brands.
LESLEY: Claim to fame.
MEG: Yes, exactly. And I got this job and I came back to Boston and I said, “Griff, I really think that we should move to California. I think this is going to be the opportunity of a lifetime. We loved living in California. It’d be great to raise the boys in a more technology-oriented environment.” And Griff was, at first, a little skeptical. He said, “Well, how about you go out there and see how it goes?” And I said, “No, no, no, no. We have to do this as a family because I will not be successful if I’m separated from you and the boys.” And he said, “Alright.” And I said, “So, what do you think we ought to do?” And he said, “Well, I will call out to California and see if there are any jobs.” And as fate would have it, the head of the neurosurgery department said, “Actually we have the perfect job for you. It’s the head of the brain tumor program at Stanford. It’s an opening in brain tumors,” which is what my husband does. “And I know your reputation and we would be delighted if you applied. And, if you want it, I think there’s a good chance you can get this job.” It never happens like that, Lesley.
LESLEY: I was going to say, you have the most golden life I’ve ever heard about. What woman, who gets this great job, her husband loves what he’s doing, says, “Let’s move.” And he says, “Fine,” and gets a job as good. That doesn’t happen in the real world.
MEG: It was one of those things – and I’m a big believer, actually, that things happen for a reason. It was one of those things where the stars aligned. And so we moved out to California with two new jobs, two new schools for the kids. We moved from a lovely 10,000 sq. ft. brick Georgian house in Brookline, to Oak Creek Apartments across from Stanford Medical School. And that’s because I took a huge cut in pay.
LESLEY: You did? You took a huge cut in pay from Hasbro? But you weren’t running Hasbro?
MEG: No, no, no, no. But I was the president of the preschool division. And when you came to dot-com companies, pre-IPO, you actually took a huge cut in pay. I went from close to a million dollars to actually $100,000 when I joined eBay.
LESLEY: Oh, my God.
MEG: And so we didn’t want to take on the responsibility for a house. We moved to Oak Creek Apartments into a two-bedroom apartment. And the fun part about this was that the second bedroom was actually smaller than the walk-in closet for the master bedroom. And so our 13-year-old lived in the master bedroom walk-in closet for the year. It was one of those … you know, it was one of those great things, Lesley, where we were together as a family in a tiny little space. It was, you know, one of those things where you think it’s going to be bad but it actually has some really good outcome.
LESLEY: But these were teenage boys, right?
MEG: They were 13 and 10.
LESLEY: Oh, 13 and 10. OK. But still – I said this while you were telling your story – you have this golden life. Things work out. You take this gigantic cut in salary and now you’re one of the richest women in the world, because you took the gamble. Your husband moved with you. No one has a life like that. What are you doing? What are you doing that brings you this … what is it? The mantel of heaven, I think.
MEG: I have no idea, Lesley. You just try to do the right thing. You try to make it work for everybody. And frankly I would not have moved had Griff not gotten a job out here. I wouldn’t have. Because, you know, moving across the country with a young family … I mean, you just can’t do it. Right? And so, when he was working at Harvard, he had a full-time – more than a full-time – job. So, sometimes things happen for a reason. You’re supposed to be where you’re supposed to be at a certain point in time. And that’s the only thing I can chalk it up to.
LESLEY: So, Meg, let’s talk clothes, OK?
LESLEY: Alright. This is not an insult. I think you’ve even said it about yourself: “Glam, I’m not!” Right? Tell me if this is true: you seem to wear, basically, khaki pants and a polo shirt every day. None of this “dress for success,” those suits that you see – frankly, that I wear. Whoops. Did you make a conscious decision about how you wanted to look?
MEG: So, in my early days – I have a hilarious picture, Lesley, that I should probably send you, that I can’t really let you publish.
LESLEY: Oh, darn. We want the picture!
MEG: It’s of me at Bain & Company in the 1980s and I was wearing the 1980s outfit of a suit, a white shirt and remember those little bowties we used to wear?
LESLEY: Oh, absolutely. Of course.
MEG: I mean, it was the sort of emerging executive women outfit. And so I thought a lot about it in my early days at Bain. And, you know, we were consultants, right? So we had to have a little bit more. But my personal style is not a particularly … you know, I just haven’t … it’s not an interest. I’m not very good at it.
LESLEY: Not good at clothes. Not good at shopping.
MEG: I’m not good at clothes. I’m not good at fashion. And you know what? I think it really sort of stems from growing up. My mother wasn’t very good at it, either.
LESLEY: It’s genetic.
MEG: It’s genetic. And so I just wear what I’m comfortable in and it … one of the joys of coming to Silicon Valley was that everyone is very casual here. So wearing khakis and a button-down shirt every day is kind of what everyone wears. And, blue jeans and…. So, I have actually thrived in an environment where it is a very casually dressed environment, and, obviously, will wear a suit when it’s required. But I am most comfortable, you’re right, in a pair of khakis and a button-down shirt.
LESLEY: Well, it sends out an image of, I don’t know, nice. It does.
MEG: Oh, you will appreciate this. Over the last 10 years, households, as it turns out, do not run themselves.
MEG: And every married couple knows that. Everyone who runs a household knows that households do not run themselves. And in many ways my husband has run the house for the last 10 years. And he would appreciate a great deal of help in sort of turning that over. I’ll tell you a funny story. I came down to breakfast the other day. There was a to-do list for me.
LESLEY: Oh, come on. From him?
MEG: From him.
LESLEY: But your boys are gone, right? They’re out of the –
MEG: The boys are gone, yes. They’re gone.
LESLEY: What do you have to do to run the household when it’s just two of you?
MEG: You know, you … households … the dry cleaners, the grocery stores, who’s going to … you know, the dishwasher broke. We live in a house that’s about seven years old and the dishwasher broke. Well, someone actually has to call the dishwasher repairman to come fix the dishwasher. It’s about, you know … my son is going to Ireland on a rugby trip and he needed some Euros. So someone has to get the Euros for the freshman in college to take to Ireland.
So there are a million details that have to get managed in a house. And he has done most of them and I will take some of that burden for the foreseeable future. Because it’s the right thing to do and I think Griff is having quite a nice time pushing things to me.
LESLEY: I love that. Let me ask you just two more questions. One is about the economy, which seems to be in free fall at the moment. The markets, the sense of recession, the dollar is falling, people are being laid off, quite dramatically off, in every kind of industry you can think of. First off, what do you think of the economy? And secondly, maybe some advice. Where would you put your money at a time like this? What are you doing? And talk to our audience. Tell them what you think they should be doing.
MEG: Well, I am worried about the economy, Lesley, for exactly the reasons that you described. You know, you have this subprime mortgage crisis, which has a ripple effect on the economy, because if someone in your neighborhood loses their house – it turns out that most houses that are sold because someone defaults on the mortgage are actually sold for about 40 percent of the mortgage. So it’s a big value destruction when someone cannot pay their mortgage. And that has a ripple effect because then that house comes back online in your neighborhood, which reduces housing prices.
And I’m very concerned about what housing prices are going to do over the next year to 18 months. And I’m also worried, honestly, about the financial markets that you described, which is the pressure on the NASDAQ, the pressure on the New York Stock Exchange, the pressure on the stock price of companies, because of the liquidity crisis, because of the credit crisis.
And I think it’s excellent that the Bush administration has stepped in. I guess the Fed cut rates again this morning, and that’s the right thing to do, no question about it. The stimulus package, the rate cut, and the government may need to do more here, depending on what happens. And I think the government is doing some very good things in terms of working with lenders, working with borrowers to – if you want to stay in your house, there probably is a way to stay in your house, if you work with your lender.
So, where would I have money right now? I think it’s not a bad strategy to have a fair amount of money in cash right now, and be looking for opportunities to invest. But I would be sitting on the sidelines for a bit right now, and thinking hard about when it would be the right time to get back in, in a modest way. And I think what is so true, and what financial planners tell everyone, whether you have a thousand dollars in savings or much more, is diversification. Don’t put all your eggs in one basket – in one stock, in one type of stock, in bonds. Diversify as best you can. And that has proven, over many, many years, to be the most prudent way to invest. You may not get the highest annual returns, but you won’t lose money. And you will make money over time in a consistent sort of way.
So my message to the readers of your website is to sit on the sidelines. But if you get in, make sure you have a diversified portfolio of assets, as best that you can.
LESLEY: Yeah. Good advice. Final question. As we already said, the boys – your two sons – are how old now?
MEG: 22 and 19.
LESLEY: 22 and 19. They’re not really at home any more. They’re off to college or starting their career. And it’s just you and Griff. And I remember, in my own case, when my daughter left. My husband and I looked at each other and said, “Well, what do we like to do that isn’t really determined by our daughter? What do we really love to do?” So have you figured that out? What do the two of you like to do just for fun?
MEG: We actually really like to hike. And it’s something that we do together, and locally. One of the great things about living in California is the state parks, all up and down the coast. So we do a fair amount of hiking together. This was a fun thing we did about a month ago. We went down to see the elephant seals at Año Nuevo. I have lived in California for nearly 20 years and I’ve never been to see the elephant seals. And we had a ball. We drove to Half Moon Bay, drove down the coast, had a picnic lunch, went to see the elephant seals, on the most spectacular California day that you have ever seen. And then took off to a hike in the redwoods that’s just north of … or just a little bit south of Half Moon Bay, and did about a 10-mile hike, which I was dying at the end of.
LESLEY: What do you two do in the car? Do you listen to a book on tape? Do you finally sit and talk to each other? Do you take a little nap?
MEG: We talk. I like to drive because I get carsick if I’m in the passenger’s seat. And so I like to drive and we talk and then my husband will read a little bit. And then he naps, I think, as I recall, on the way back from the elephant seals.
LESLEY: Do you sing?
MEG: No, but we do listen to music.
LESLEY: Well, Meg, this has been informative. It’s been so interesting. It’s been delightful. And we can’t thank you enough and we hope we can invite you to come back.
MEG: Well, I am delighted. Thanks for asking, Lesley. And I hope we can get together in person in the near future.