Craigslist: The capitalist conundrum

As a Visiting Fellow in the Reuters Digital Vision Program at Stanford University, I often find myself sitting in on some pretty amazing talks and lectures from some of the most amazing people. Love ’em or hate ’em, I even had the chance to hear from the likes of Bill Gates and Arnold Schwartzeneger recently. (Bill described the iPod as nothing more than “a hard drive with music on”, and Arnie wanted to see more cranes (that’s the building-type, not the bird) in California. Eye- and ear-opening stuff, but one for another blog entry, I feel).

Last month, Jim Buckmaster, CEO of Craigslist, came in to talk with us. It was a small, intimate affair. More like a Q&A around the camp fire than a Stanford seminar. But this is how Jim seems to work, and it suited us all down to the ground. Not even a plush Powerpoint presentation to talk of. Just Jim.

For about an hour-and-a-half, Jim described the Craigslist phenomenon and answered a whole bunch of questions. The seventh most visited site on the web, volumes of traffic that I could only dream of (for now!) and a web ‘presence’ in most major cities around the world. Yet all managed with a staff of less than forty. Just compare that to the hundreds, if not thousands, who work with other dotcom ‘giants’. What struck everyone was the work ethic – a desire to keep things simple, give the users what they want and turn a blind eye to “maximising revenue”. Craigslist, you see, doesn’t have any ads, other than the ones posted up by users, and certainly no big money-making schemes.

“There are forums on Craigslist, and users have the chance to tell us what they want from the site, like if they want ads. And, so far, they haven’t asked for them. So we don’t”

It was very much an “anything for a simple, quiet life” ethic, even if this meant turning down tens of millions in potential revenue. So, when Jim met with a bunch of New York bankers several weeks later, imagine the mayhem and confusion. Described in a New York Times article as a “culture clash of near-epic proportions”, some in the audience really struggled with the concept of “non-revenue maximisation” and “serving customers first and worrying about revenues later”. In a world where money talks – as it certainly does in Silicon Valley – it is so refreshing to meet someone bucking the trend. And many people seem to agree, judging by the comments left on the New York Times website.

“Craigslist is the best example of businesses that are refusing to make money the only goal, or even the main goal.

This type of customer-driven business, running as a partner to society instead of an aggressor, is the form of the future – truly green companies. They are hybrids of sorts, combining the best of for-profit and non-profit characteristics”

The fact that a bunch of bankers struggled so deeply with the concept makes it even more entertaining, for me at least.

Until you wake up, keep scratching, guys…