eBay 1998 Annual Report Download - page 30

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30
Risk Factors
The following risks should be carefully considered. The risks and uncertainties described below are not the
only ones facing our company. Additional risks and uncertainties not presently known to us or that we currently
deem immaterial also may impair our business operations. If any of the following risks actually occur, our business
could be harmed.
We have a limited operating history.
Our company was formed as a sole proprietorship in September 1995 and we incorporated in May 1996. We
have only a limited operating history on which you can base an evaluation of our business and prospects. As an
online commerce company in the early stage of development, we face increased risks, uncertainties, expenses and
difficulties. You should consider an investment in our company in light of these risks, uncertainties, expenses and
difficulties. To address these risks and uncertainties, we must do the following:
• maintain and increase our number of registered users, items listed on our service and completed auctions;
• maintain and grow our website and customer operations;
• continue to make trading through our service safer for users;
• maintain and enhance our brand;
• successfully execute our business and marketing strategy;
• continue to develop and upgrade our technology and information processing systems;
• continue to enhance our service to meet the needs of a changing market;
• provide superior customer service;
• respond to competitive developments; and
• attract, integrate, retain and motivate qualified personnel.
We may be unable to accomplish one or more of these things, which could cause our business to suffer. In
addition, accomplishing one or more of these things might be very expensive, which could harm our financial
results.
Our operating results may fluctuate.
Our operating results have varied on a quarterly basis during our short operating history. Our operating results
may fluctuate significantly as a result of a variety of factors, many of which are outside our control. Factors that may
affect our quarterly operating results include the following:
• our ability to retain an active user base, to attract new users who list items for sale and who complete
transactions through our service and to maintain customer satisfaction;
• our ability to keep our website operational and to manage the number of items listed on our service;
• federal, state or local government regulation, including investigations prompted by items improperly listed
or sold by our users;
• the introduction of new sites, services and products by us or our competitors;
• the success of our brand building and marketing campaigns;
• the level of use of the Internet and online services;