SBJ/March 20 - 26, 2006/Forty Under 40
Published March 20, 2006
By Eric Fisher
• Age: 32
• Titles: CEO and co-founder
• Company: StubHub.com
• Education: B.S., finance and engineering, University of Pennsylvania; attended Stanford Graduate School of Business
• Family: Wife, Claire
• Career: Was a leveraged buyout professional at The Blackstone Group from 1996-98; founding private equity professional at Thomas Weise Partners from 1998-99; co-founded StubHub in 2000.
• Last vacation: Galapagos Islands
• Last book read: “Bringing Down the House” by Ben Mezrich
• Last movie seen: “Wedding Crashers”
• Greatest achievement: Upsetting Morris Knolls’ first doubles tennis team in high school county tournament
• Greatest disappointment: When Bill Buckner let the ball go through his legs during Game 6 of the 1986 World Series where the Mets went on to beat the Red Sox. I had just moved from the Boston area to the New York area. I was watching the series with friends and I painfully lost bragging rights after telling my new friends that the series was “in the bag.”
• Fantasy job: Manager for U2
• Executive most admired: Jack Welch
• Business advice: Do something you are passionate about and success will follow.
Jeff Fluhr, StubHub chief executive and co-founder, began his business career in one of the toughest ways possible. After dropping out of Stanford Business School, Fluhr posed an utterly simple, yet toxic, idea to the sports world: Let me help your season-ticket holders resell seats they cannot use.
Fluhr's idea did not entirely reinvent the wheel. Teams want their buildings filled to generate concession and parking revenue, and ticket holders don't want ducats going to waste in their desk drawers, making his creation of a national online resale marketplace a natural marriage of those two aims. But for years, the sports industry viewed the secondary ticket market as one populated solely by criminals and con artists, and in many circles still holds that opinion.
With dogged determination and a high-profile marketing strategy that went directly to fans, Fluhr essentially brought the sports industry to StubHub. The company last year tripled its volume of ticket resales to more than $200 million, garnered more than $50 million in commissions, and perhaps most shocking, now holds official relationships with more than a dozen pro and major college teams.
"We did spend a lot of the early days banging our heads against the wall, and there are still a lot of teams sitting on the fence on this issue," said Fluhr, recalling the company's beginnings as Liquid Seats. "But this market is going to exist. Why not make it completely safe and 100 percent reliable? There's a light bulb that has finally gone off and we're hitting a completely different level of consciousness."
Still, Fluhr and StubHub compete in an extremely competitive market, one perhaps approaching $10 billion annually. Internet auction site eBay generates exponentially more Internet traffic than StubHub. Ticket brokers, which represent part of StubHub's available ticket inventory, have local connections that StubHub cannot match. And RazorGator and TicketMaster's secondary ticket operations are now both online and growing quickly, pursuing much of the same business as StubHub.
For his part, Fluhr relies on a natural entrepreneurial bent that as a kid had him selling candy out of his locker, distributing toys as a 12-year-old and working for a stockbroker in high school. The extreme type-A personality continued at the University of Pennsylvania, where he earned dual degrees in engineering and finance.
"I was really hesitant about doing a deal with them and cannibalizing our business," said Kevin Morgan, the Washington Capitals' vice president of sales. Last December the club sold an official sponsorship to StubHub, which then markets its services to Caps ticket holders. "But we spent a lot of time checking Jeff and the company out, and everything cleared out. And when we got to know them and sat down to do the deal, it was an incredibly easy process, maybe taking parts of a couple of days. And it's worked out great for us."