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Alibaba, ShopRunner, eBay: is Philly's e-commerce legacy fading?

Sales down at ex-GSI unit

The long-awaited Alibaba Group Holding initial public stock offering (IPO) prospectus is finally out -- flip through all 300+ pages here -- with a little more detail about Alibaba's big investment in Michael Rubin's formerly Conshohocken-based ShopRunner, which competes with the Amazon Prime retail delivery service: Alibaba says it paid a total of $202 milllion last year for a 39% interest in ShopRunner, which still hires engineers and other specialists locally, but has been run from San Mateo, Calif., since hiring resume-challenged ex-Yahoo executive Scott Thompson as CEO two years ago.

Alibaba's interest in ShopRunner was widely reported last year; "China's eBay" has apparently replaced America's eBay as the group's big outside investor. Rubin controls the group through his Conshohocken holding company, Kynetic. Alibaba also reportedly joined a group led by Singapore-based Temasek in a $170 million investment in, Kynetic's Florida-based branded sports marketing operation, which counts Comcast and other TV sports providers as clients. That investment implied a $3 billion Fanatics valuation, Wall St Journal reported here. But in its IPO papers, Alibaba doesn't report any (material) relationship with Fanatics.

Kynetic includes the businsses kept and built by Rubin since control of his publicly-traded former company, GSI Commerce Corp., King of Prussia, was purchased by eBay for close to $2.5 billion in 2011. The business was renamed eBay Enterprise and continued to operate under the leadership of veteran Philadelphia eCommerce executive Chris Saridakis. But Saridakis left abruptly in January, and was charged with insider trading (benefiting friends and family, not himself) by the Securities and Exchange Commission and federal criminal prosecutors last week. Saridakis has taken responsibility for his actions and regrets what has happened, according to his lawyer. Meanwhile, eBay Enterprise is being run by another GSI veteran, Tobias Hartmann. But according to eBay's own numbers, sales have slipped from more than $1.3 billion in 2011 to around $900 million in 2013. 

eBay's parking lot on First Ave. in King of Prussia is looking pretty empty lately; the staff there is down from more than 500 to maybe half that, according to a manager who left earlier this year. eBay's local spokeswoman didn't immediately return calls seeking comment. eBay recently combined Enterprise with a smaller business group, Magneto. Will eBay move other managers to the unit to try and restart growth?