The Last Idealists

For

those wondering whether Silicon Valley idealism went on sale with Google's first share of stock, look no further than Craig Newmark and Jim Buckmaster, the men behind the online bulletin board Craigslist. Here's Newmark, its founder, on success: "Once you make a comfortable living, how much extra stuff do you need?" Here's Buckmaster, its CEO, on strategy: "We're not setting out for global domination. We're just looking to provide our service to people who need it. If it's not needed, that's fine." Not surprisingly, Craigslist has no marketing department.

So how is it that Craigslist has become one of the Web's Top 20 portals, with 5.3 million visitors a month to its job and real estate listings, for-sale postings and personals? How has it grown exponentially from a narrow base in San Francisco and New York City to 45 cities, from Orlando, Fla., to St. Louis, Mo., to Fresno, Calif.? How has it managed to spread its wings abroad in Canada and Britain, with Australia next on its horizon? How has it managed to do all that — when other, more capitalized businesses have withered away?

The answer is basic and profound. By focusing on what their customers want instead of what's good for the Craigslist brand, Newmark and Buckmaster are beating the online giants at their own game. Using only open-source software and a plain-text site without fancy logos or graphics, Craigslist is supremely efficient. "Virtually no users are requesting that we dress the site up," Buckmaster explains. As a result, the site runs 1 billion page views a month — as many as Amazon.com — with just 14 employees. Instead of doing market research to plot strategy, Newmark and Buckmaster rely on customer feedback, using it to drive every decision from what city in which to launch next to how to categorize short-term gigs separately from part-time jobs. The result? Without any advertising, Craigslist attracts as much traffic to its job listings as Monster.com.

Newmark, a paunchy 51-year-old programmer with a fondness for science fiction, started Craigslist in 1995 as an informal list of Bay Area social events. He waxes poetic about Craigslist's unusual business mission to create a commons that the company maintains rather than a product that it sells. Buckmaster, an intense, analytical Spock to Newmark's Captain Kirk, is the implementer of that vision. He and Newmark use the word customer to describe Craigslist's users, but no one has ever paid a dime to use the site. Craigslist's only revenue, projected to be as much as $11 million this year, comes from modest fees from employers who post job listings.

So successful is Craigslist that the site has inspired several copycats and drawn the attention of the biggest online giants. Earlier this year, eBay, which has its roots as an online community, bought a 25% stake in Craigslist from a former Craigslist employee for an undisclosed amount (after getting the blessing of the company's founders). eBay says the purpose of its investment is to learn more about online classifieds, a business that neither eBay nor Yahoo has successfully cracked. For Newmark, who insists that eBay will not change Craigslist, the deal gives his company access to eBay's experience in rooting out online scam artists.