Ebay Expert Greg Kusch Ebay Training Forbes Magazine Meg Whitman February 17, 2008

Much Ado About Meg
Erika Brown 01.24.08, 6:30 PM ET FORBES GREG KUSCH

Margaret C. Whitman
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BURLINGAME, Calif. - After months of speculation and denial, eBay chief executive Margaret (Meg) Whitman officially announced her retirement this week. She will step down in March, on her 10-year anniversary with the company.

The Silicon Valley gossips have been making a fuss about whether she was bumped out, saying she deserves to be ousted. After all, the company's growth has been slowing (Only 30% revenue growth? The horror!), and in November, eBay (nasdaq: EBAY - news - people ) had to take a $900 million write-off due to the Skype acquisition.

In my humble opinion, that's absurd. For one thing, Whitman is retaining her board seat; executives who've been pushed out don't typically get a say in the future direction of the company.

Take a look at her track record. She became chief executive of eBay in March 1998. Six months later, she took it public at an initial market valuation of $700 million--that was at the early stages of the Internet bubble. Today, the company is worth $40 billion, which means eBay shareholders have been the happy recipients of a 5,600% return.

The company now brings in nearly $8 billion in revenue annually. In 1998? $47 million. When Whitman joined the company, eBay was a piker attempting to challenge online mega-malls run by Amazon and Yahoo (nasdaq: YHOO - news - people ). Ebay could have been just another dot-com implosion.

Whitman used her Bain training to impose order: She held managers to rigorous analytical standards and measurements. She built a real company in an era when people were using sock puppets and Super Bowl ads to conceal their hole-filled business models.

Meg has been a consistent, true believer. Ebay's stock makes up the majority of her $1.2 billion fortune--which, by the way, she built on her own. She is one of very few self-made female billionaires on the planet, and has been one of the few female, C-level executives in tech.

But what about Skype? Board members I've interviewed made it clear--off the record, of course--that Whitman pushed the deal even when they balked that it was too expensive. Skype brought in just $115 million last quarter; that's a less-than-$500 million run rate. Ebay paid six times that more than two years ago--quite dear.

But before you ask for her blonde head on a silver platter you won at auction, take a look at her peers. Remember 1999? Cisco (nasdaq: CSCO - news - people ) paid $7 billion for Cerent. It has since disappeared into the chasm of Cisco's vast portfolio. Did people string up John Chambers for such an extravagance? No--he is labeled one of the best chiefs the valley has ever seen.

Let's compare Whitman to another of her oft-hailed peers: Steve Jobs. Obviously he has built one of the world's best-known brands and restored a once lowly company to greatness. But Apple (nasdaq: AAPL - news - people ) has also engaged in options back-dating. Whitman's record at the SEC is clean.

The Skype blunder aside, Whitman has made some bold, successful changes. In 2002, she paid $1.5 billion for PayPal. The online payment processor now brings in some $2 billion in revenue a year. Ebay is available in Malaysia and the Philippines. It owns online marketplaces in South Korea, Germany and India. The company also owns a quarter of Craigslist.org, and is now selling tickets through StubHub and listing apartments through Rent.com.

Presidential hopeful Mitt Romney took time away from his campaign last April to talk to me about Whitman for a cover story I was writing on eBay. Not many executives get such love from politicians, particularly when they're busy pounding the campaign trail.

Romney helped recruit Whitman into her job at Bain soon after she completed her Harvard MBA. She is now one of the leaders of his fundraising campaign. "She is absolutely relentless. She is a powerhouse," Romney says of Whitman. "She doesn't just raise money and wish me well; she insists on sitting down and working on the key issues I'm wrestling with. Her reputation has brought credibility to our effort. People are convinced I must have something going for me if I have Whitman beside me."

Whitman's impact is felt most deeply by everyday people. She is the welcoming face of a "safe" company on the dark, scary Internet, as well as the representative of a company that has helped make thousands of work-from-home sellers rich. Ebay's soon-to-be-chief John Donohoe will have a hard time in his efforts to replace her in that role.

Greg Kusch, a proud eBay power seller, has auctioned off thousands of items on the site, from Tiffany (nyse: TIF - news - people ) diamond rings to a crypt space next to Marilyn Monroe. "I have met Whitman a number of times. She has an aura of a winner. When she is there, you feel the power," he says. "She has allowed people like me to become entrepreneurs. She is an inspiration to people like myself. I really look up to her."

Now that's quite a legacy.

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