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EBay Entrepreneurs Bidding on Success

Sierra Madre couple's home-based auction operation affords them a new way of life but little time for themselves

October 27, 2002|David Colker | Times Staff Writer

You can find everything on EBay from a Learjet to a velvet painting of Elvis. But Jay and Marie Senese have found something far more rare on the auction site: a new way of life.

EBay Inc. has afforded the husband-and-wife entrepreneur team the chance to earn a living selling CDs from their Sierra Madre home. They wrote a business plan, found sources for the more than 5,000 used CDs they put up for bid weekly, worked out the considerable logistics for handling their auctions and hired two full-time employees and several part-timers. The Seneses report to no one.

If only they could take a day off.

The couple's operation, known as 1 Cent CD, is by far the most successful home-based business operating on EBay, as measured by volume of merchandise.

But like thousands of other full-time EBay merchants, the Seneses have discovered one of the great ironies of the Internet: The 21st century technology that has enabled them to run a business from home also has trapped them in an 18th century, work-consuming lifestyle reminiscent of farmers tied to their land or shopkeepers who lived above the store.

This autumn afternoon in the Senese living room is typical. Marie Senese, 42, sits at a retro-style Formica table set up in front of the television. Stacked on the table and spilling onto the floor are 37 plastic trays, each holding 20 CDs. She picks up and types in the information that will be listed on EBay when the disc is put up for auction.

Then she picks up another and another.

"It's like having your own shop, except at the end of the day you don't get to go home," she said. "You're already there. And so is the work."

Every day -- including weekends -- the Seneses put 800 used CDs up for bid. Nearly all will be sold five days later, when the auctions end.

They begin the workday just after dawn and often don't finish until midnight. Weekends, when they are without their paid staff, are worse. Since founding 1 Cent CD three years ago, they have taken exactly four vacation days, and even then they took their laptop along.

"It gets weary," said Marie Senese.

'Global From Day One'

With the advent of EBay, launching a business seems seductively easy. There are no bricks-and-mortar storefronts to rent, no distribution channels to create, no marketing campaigns to launch, not even an Internet domain name to register.

"Most of the expertise you need to have a professional-looking business is already built into the system," said Jerome Katz, a professor at St. Louis University who has written several academic journal articles about EBay. "One of the marks of business maturity is that you get to the point where you sell to global markets. On EBay, you're global from day one."

Executives of San Jose-based EBay said they have no detailed information on how many of the sellers among their 50 million registered users consider it their full-time work. But they estimate about 90,000 of them make at least $2,000 in monthly sales.

"Almost since the beginning, 20% of our sellers have accounted for 80% of sales volume," said EBay Chief Executive Meg Whitman. "These people, including those who sell full time, are central to our success."

For 1 Cent CD, the workday begins at 6:30 a.m. Jay Senese, 44, fires up the desktop computer in the couple's bedroom and peruses the approximately 800 e-mails that arrive each day. Marie Senese gets their 9-year-old son off to school.

On weekdays, Jay Senese climbs into his 1994 Saturn wagon and makes his rounds to the used CD shops in Southern California that supply 1 Cent CD with products.

Record shops always have played an important role in Jay Senese's life. He met Marie in Lovell's Records in Whittier 20 years ago. Dressed in jeans, a paisley shirt, and with his long, graying hair pulled back in a ponytail beneath an ever-present baseball cap, he still looks the part of a rock fan. A business degree at Whittier College and a job at Merrill Lynch hardly damped his enthusiasm for head-banging music.

With a stockbroker's salary of $250,000 a year, Jay Senese spent lavishly on his music habit. He sometimes bought 500 CDs at a time, eventually amassing a library of 30,000. To make room for them all, he discarded the plastic jewel boxes and pressed them disc-to-disc on wooden racks in the living room and bedroom. He not only bought CDs, he sold them to other rock fans who frequented Internet message groups.

He said it was a hobby, but Merrill Lynch saw the online CD sales as an entrepreneurial venture, and in July 1998 the firm terminated him in part because he was running an undisclosed business. Merrill Lynch also cited his "personal trading in penny stocks and financial adjustments to his own account" in a report it made to the National Assn. of Securities Dealers, the brokerage industry's self-policing organization. Senese, who said the reason for the firing was a money dispute, filed a suit against the firm in 1999 that is still unresolved.

A Business Is Born

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