hen corporate executives start discussing their efforts to influence company culture, a healthy amount of scepticism is advisable. But Murray Lambell, the UK boss of US online retail giant eBay, can draw on personal experience of the importance of how a business cares for staff. For many years he hid his sexuality from colleagues in a culture that was “more stifled and stuffy internally”.

“It was probably my own baggage,” he says. “I was not comfortable to be out at work … A lot of the leadership was white, middle-aged, from a very specific demographic and academic background, which didn’t all resonate with me. I didn’t feel comfortable to be a complete person at work and then that limits you.”

So what emboldened him? Until now, Lambell has been speaking briskly, beneath vivid images from graphic designer Alba Blázquez in the bright surroundings of eBay’s UK headquarters in west London. He takes a deep breath, visibly emotional. “I was married and my partner died. I had to come into work for the first time and tell my boss: ‘Oh, by the way I’m gay and my partner is actually in hospital right now.’

“I was thinking: ‘I shouldn’t be dealing with this issue right now, when I’m trying to deal with an existential crisis.’ I was having to deal with too many things in one go. I realised there was probably nothing to be fearful of.”

Lambell says his bosses at the time, in 2014, were “horrified” that he hadn’t felt comfortable discussing his sexuality earlier and the experience has emboldened him to treat employee inclusivity as a “moral obligation”. (The board is now more diverse and he’s taking a Yale University course on the subject.)

CV

Age 46

Family He has a partner, Robin.

Education BA in French and history at Exeter University and master of business administration at London Business School.

Pay Undisclosed. “More than I ever expected to earn, less than you might think.”

Last holiday Elie in Fife, Scotland.

Best advice he’s been given “Deliver, deliver, deliver,” from the former eBay chief customer officer Wendy Jones.

Phrase he overuses “History doesn’t predict the outcome.”

How he relaxes Other than running – “To show my 25-year-old
nephew who is fastest” – he is trying to learn new languages. “Currently doing well at Spanish and OK at Farsi!”

***

Not that eBay’s recent culture has been beyond reproach. Last week two former executives in the US were jailed for their part in a harassment campaign against a couple who published a newsletter critical of the company.

Five other employees, who have also all since left, pleaded guilty for their roles in the bizarre scheme, which included sending live cockroaches, a funeral wreath and books about surviving the loss of a spouse to the couple’s home. “That’s not something I recognise about our business and what we represent,” Lambell says, speaking before the sentencing, but adds that there is “still work to do”.

We meet as eBay faces two tumultuous global headwinds: the brutal sell-off of US tech stocks and the impact of a protracted cost of living crisis on discretionary spending. Both require the Californian company to draw on the resilience that enabled it to create the first big online marketplace and sustain it for 27 years while its web 1.0 peers crumbled.

Not that its UK home in a cobbled square beside the Thames in well-to-do Richmond recalls Silicon Valley. A lonely-looking table-football unit is the only nod to tech work culture, and each meeting room has a pointedly British name and theme (we sit in Bond, a silhouette of 007 etched into the glass).

The stock sell-off has proved painful for eBay. The pandemic shift to online buying pushed shares to all-time highs above $80 last October but they have since fallen by 46% as restrictions have eased, valuing it at just over $20bn.

In August it reported that gross merchandise volume – the value of all the goods it sold – fell for the fifth consecutive quarter, down 18% at $18.6bn. Active buyers were down 12%, to a still respectable 138 million.

Lambell is unshaken: “This is a long-term play. So the pandemic [drove a different] category mix – we’ve now got economic pressures. Supply chains are going to have to adapt to move. Consumers will want to buy things on a trusted, reliable platform and we provide that.”

We’ve had two years of utter disruption – people are still going to splurge at Christmas but I think they’re being a lot more planned about it

He admits some categories such as home and garden products “are going through a total hangover” after a pandemic boom. Meanwhile, discounted and refurbished goods are selling well.

So should we expect squeezed Britons to seek a secondhand Christmas? “We’ve had two years of utter disruption – people are still going to splurge but I think they’re being a lot more planned about it. They will prepare and split their spend over months.”

Lambell’s job is also to encourage and promote sellers of products that “hit the zeitgeist”, such as heavily searched solar panels and air fryers during the energy crisis.

That hunt for the next trend led eBay to acquire Manchester-based non-fungible token (NFT) marketplace KnownOrigin in the summer. Lambell says the deal brings “our web 1.0 with this web 3.0 world together”. He envisages eBay’s army of collectors photographing their sought-after treasures – such as artworks – and selling NFTs of them. “Clearly the market has a long way to evolve – it’s very early days.”

Part of Lambell’s strategy is to convince high-end fashion brands to list ex-display and imperfect stock instead of ditching or, previously, burning unwanted items to avoid devaluing the product. “For years, eBay was seen as the pariah of those brands. They hated the fact that their stuff was being resold … and you saw [that] type of awful behaviour,” he says, adding that conversations are now at “varied levels of maturity” with brands looking to sell off their inventories in carefully curated parts of his site.

The company’s high-end business has also grown through its authentication service, launched last year for watches, handbags and trainers,which has seen it physically handle products in warehouses for the first time. Growing consumer concerns about waste should drive sellers and buyers to eBay, he adds.

Lambell’s own recent eBay search history points to his early career – a former Swissair drinks trolley he spotted on a recent trip to Switzerland sent him down an online rabbit hole, reliving his postgraduate years with British Airways. He left his corporate role at the airline after witnessing strike action that caused passenger fury in Heathrow’s Terminal 4. “It was almost a riot,” he recalls.

The Canterbury native’s worldview has also been shaped by his parents’ struggles in the latter days of running their transportation business. “It was very emotional watching what they went through – these big partners were basically putting so much pressure on them in terms of cost that they couldn’t deliver the service they were proud to deliver.”

Does he keep that in mind when dealing with thousands of small firms? “Yeah, [although] I’d never say that with the businesses directly. I think they would say: ‘That sounds like spin.’”

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Due diligence is one of those terms that you may understand on the surface but don’t know how to put into practice. Let’s learn about due diligence and how to use it in a real-world setting.

What is due diligence?

The dictionary definition says that due diligence means “the care that a reasonable person exercises to avoid harm to other persons or their property.” In plain English, due diligence means doing your homework. Before putting your business funds to work on anything, you should make yourself an expert. Often, due diligence means the investigation done before purchasing another company, so let’s start there.

How do I perform due diligence?

Let’s assume that you’re planning to buy out one of your competitors who is retiring. The business is attractive to you because it’s perfectly positioned in an area of town that’s tough for your business to reach. Before you purchase the business, you (often with the help of professionals) will perform due diligence. The due diligence process would include getting answers to questions such as these:

• Does the business have healthy cash flow?
• By looking at the books, can you tell where the revenue stream is coming from?
• How reliable are its financial projections, and what multiple is it placing on those earnings?
• Are profits going up or down?
• How big is the market for the company’s products or services?
• Is the market growing, shrinking, or stagnant?
• Are there any major new competitors in the area or coming into the area that could negatively impact earnings?
• What kind of online presence does the business have, and how does it compare to its competitors?
• If the company has physical assets, are they valued correctly and fairly?
• Are there any hidden liabilities?
• Are the company documents complete? (for example, Articles of Incorporation, board meeting minutes, tax registration, etc.)
• Is the business up to date on its taxes?
• Does it lease property? If so, when does the lease end?
• What insurance information is provided, and what is covered?
• Are there complete employee files including salary and benefits?

Of course, this is a very short list of the due diligence that would take place before purchasing another business, but maybe you’re not in the market to buy a business. Maybe you’re planning to buy a new building or add a new vendor or product line. There are plenty of decisions you are likely to make where proper due diligence is key.

Due Diligence for Purchasing Commercial Property

• Environmental Concerns: Does the property contain hazardous materials like asbestos, lead paint, or radon? If it does, have assessments done on the costs to mitigate the hazard. Does the property sit on a flood zone, active fault-line, or protected environment? 
• Location: What are the mineral, gas, and oil rights to the property? How much traffic will pass by your business each day? Is it easy to enter and exit? Is there enough parking?
• Building inspection: A qualified building inspector will perform the inspection for you, but, in the meantime, are there any liens on the property? Were all contractors who worked on the property paid by the previous owner?
• Code Compliance: Does the property comply with all building safety, and zoning codes?
• Performance Data: How did the current owner perform in this space? Get business information like profit/loss statements if possible.

Due Diligence for Adding a Vendor

• Is the ordering process easy and straightforward?
• Do they have multiple warehouses in case a product is out of stock at one site?
• Is a warehouse close enough that shipping costs will be minimal?
• From the time of the order, how long until it arrives at your door? 
• How often do they bill, and what are the terms?
• If the company is manufacturing products for you, are they large enough that you can feel confident that any money paid upfront is safe?
• Are they willing to put special pricing in writing?

Due Diligence for Hiring an Employee

• Ask for three references and personally verify at least two.
• For professional positions, verify that the person has the credentials they listed on their resume. Ask for copies of degrees, certifications, and experience. When checking references, verify that they worked in the capacity listed on their resume.
• Test their skills to see if they have core knowledge. Make a test on your own or check with your industry trade group about ready-made assessments.
• Psychological testing is important for high-stress positions. 
• Perform a background check.
• With the candidate’s permission, perform a credit check if the position involves access to financial accounts.
• Conduct an interview and ask another trusted person to conduct another.

The Hard Truth

Due diligence is time consuming, inconvenient, tedious, and sometimes expensive. It goes beyond the basic checks you would normally make, and it’s safe to say that if you didn’t find it to be about as fun as going to the dentist, you probably didn’t do it right. You should know just as much about the business or person as you do about your own business.

Bottom Line

Above, we’ve given a brief overview of some of the due diligence questions you might answer when performing these common business activities. For other decisions, produce a checklist of your own and make sure to include the needed experts. Even if you’re in a financial field, you aren’t necessarily skilled at evaluating a company’s books, for example. It’s better to spend a little money now to avoid costly mistakes later.

Disclaimer: The content on this page is for informational purposes only, and does not constitute legal, tax, or accounting advice. If you have specific questions about any of these topics, seek the counsel of a licensed professional.

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