Resources and Capabilities 53Ticket Master
One of Jeff Fluhr’s classmates from elemen-
tary school claims he had entrepreneurial
spirit even then. “I can remember him as a
kid wanting to buy vending machines, stuff
that the average sixth grader was not inter-
ested in,” recalls David Fisch, who now works
in finance for Fluhr’s company.
Fluhr’s mother remembers that he was
reprimanded in junior high school for selling
candy out of his locker. She also recalls that
after falling in love with a toy he spotted when
he was on vacation, he contacted the manu-
facturer and convinced them to make him a
distributor in his home state of New Jersey.
“They had no idea they were talking to a 12-
year-old,” his mother says. Entrepreneurship
may be in Fluhr’s blood; his mother operates
a women’s designer clothing resale shop in
Manhattan, and her grandfather once owned
a resale fur shop.
Fluhr worked for a stockbroker for a short
time during high school, and then went on to
earn a dual degree in systems engineering
and finance at the University of Pennsylvania.
After college, he executed large leveraged
buyout transactions for The Blackstone
Group, and was a founding professional in
the private, equity-investing group at Thomas
Weisel Partners before he enrolled in
Stanford University’s Graduate School of
Business.
At Stanford, Fluhr and a classmate
entered a business plan competition with an
idea for a Web site that would auction tickets
for sporting events or concerts. Their plan
didn’t win because Fluhr withdrew it before
dropping out of school. In 2000, that busi-
ness plan evolved into StubHub, a company
that is now estimated to have $200 million in
sales volume (in a $10 billion market).
If you have tickets you can’t use for a foot-
ball game, or if you want to get tickets to a
concert that is sold out, http://www.StubHub.com
may be the place to point your Web browser.
Dedicated strictly to tickets, StubHub allows
potential sellers to post tickets on its Web
site, and then try to sell them by set price,
auction, or for a declining price, meaning a
price that is lowered as the event approach-
es. StubHub takes 15 percent from sellers
and 10 percent from buyers, and provides
prepaid FedEx shipping for delivering the
tickets, passing that cost along to the buyers.
While selling tickets, or even reselling
them on the Internet, is hardly revolutionary,
a few distinctive features contribute to
StubHub’s success. Fluhr’s company
charges a commission instead of a listing fee
like eBay; StubHub facilitates delivery and
guarantees that buyers will receive their tick-
ets on time or receive replacements. The
company also reduces risk by offering 24/7
customer service by phone and providing
refunds if an event is canceled. Instead of
splitting commissions from the sale of extra
season ticket holders’ tickets, StubHub now
pays the team a flat fee in exchange for the
team’s endorsement.
Fluhr says he continues to spend a large
chunk of his time on marketing, business
development, and recruiting for StubHub,
possibly because this born entrepreneur is
preparing for what he sees as the future for
online ticket sales—prices that fluctuate
according to supply and demand from the
moment the tickets go on sale.
Addendum:In January 2007, eBay bought Stubhub for
$310 million.
SOURCE: Adapted from Steve Stecklow, “Web Site
Conceived in School Is Now a Leader in Hawking Access
to Sold-Out Events,” The Wall Street Journal, January 17,
2005: B1. See also http://www.StubHub.com, and “eBay’s
Strong Earnings,” The Wall Street Journal,January 25,
2007:A3.STREET STORY 2.3