Brad Handler '95 on eBay, Founding a Travel Empire, and Luck
By Richard Crawford '74
Interview with Brad Handler ’95, former associate general counsel of eBay, co-founder of Exclusive Resorts, LLC, and co-founder and chairman of Inspirato, LLC. Handler established the Law and Technology Initiative Fund in 2000 to support research, scholarship, and entrepreneurial activity at the Law School.
How did you decide to go to UVA Law and what attracted you to it?
I was working at Apple Computer in Reston, Va., but I’d always wanted to go to law school. I applied to Stanford, Yale, Chicago, and Penn. I told the lawyer for Apple in the Reston office that I hoped I could trust his discretion but that I was thinking of leaving Apple and going to law school. He said, “Oh, that’s great. Where’re you thinking of going?” I gave him the list and he said, “Well, what about Virginia?” He had gone to Virginia himself. I said, “Virginia has a law school?” And he said, “Absolutely. One of the best in the country,” and I said, “Good to know.” So I applied to Virginia and was accepted. Because I’m paying for it myself, once it became clear that I could go in-state, pay a much lower rate, and get as good — or better — an education, it was a very easy decision.
What did you like about your Law School experience and what did you not like about it?
I had a great time at Virginia, and a very different experience from my friends who went to Yale and Harvard and even Stanford. None of them talk about the great time they had at law school. My friends who went to Chicago had a miserable time. They all talked about “surviving” law school. I enjoyed law school even more than I enjoyed undergrad at Penn. Law school was much more fun, much more social, and much more interactive than college.
I liked the respect that the Law School gives to the students in the single-sanction [honor] system and having the ability to take your exams whenever you want and to set your own schedule. They know that you’re going to do the right thing when you take the exam and that for the people who don’t, they’re going to get booted and not get a second chance. I like them pushing down [to the students] that responsibility and personal accountability.
I also liked the approachability of the professors, which is something that my friends at other schools didn’t have. I liked the fact that I could go and ask professors questions and not have to worry about being scheduled in between their five consulting gigs and their appearance on Court TV. They would make time for you and if you didn’t understand, they would help you with it.
What I didn’t particularly like was that technology was not something integrated into the curriculum or embraced by the faculty. I worked on the Newton project at Apple. Newton was iPad Version 0. I brought my Newton with me and I would take notes on it. Nobody else took notes on a computer then. I ended up as the managing editor of the Law Review. I ripped out its computers because they were 10 years old and put in brand-new computers and a network. We even had Internet access. In fact, I remember downloading Mosaic 1.0 via FTP from the Law Review office. The Law School eventually integrated technology into the curriculum and I think now has really embraced the technology.
I was frustrated that there weren’t more classes on business. I took a corporations class, a tax class, and a corporate governance class. But I wanted to learn about the business world from a business side. It wasn’t easy to take Darden classes, so nobody did it. But I already had the Wharton background, so tax was a lot easier for me than those without an accounting background. I was also very interested in intellectual property, and eventually practiced primarily in that area. Other than Lillian BeVier, there was no one who taught intellectual property. I took all of Lillian’s classes.
Does the Law & Business Program address those issues?
Yes, absolutely. I’ve been very happy since we started the Law & Technology Program Initiative in 2000. My hope was that we could create a system for graduates who are counsel at a company or associates coming into a law firm and out meeting with clients, that they have a basic understanding of how business works, what a term sheet looks like and what it means, what the difference is between a pre- and a post-money valuation, and how a stock option plan works.
The thing that really brought this to the forefront for me was an antitrust class I took. We were talking about the Hart-Scott-Rodino Act and its different documents. I raised my hand and asked, “What kind of documents?” And the professor said, “Here’s the definition, here’s what the statute says.” “Okay, I get what the statute says, but what does that mean in a company’s existence, what does it look like?” Nobody knew. Well, it became important to know a year later when I was an associate at Cooley, I was doing a merger between two companies, and they got a Hart-Scott-Rodino review from the FTC and I had to go pull documents. It would’ve really helped if we had better examples in the course. Now, as a consumer of legal services at eBay, Exclusive Resorts, and now at Inspirato, I get really irritated if the law firm sends me someone, or if it’s my own internal resource, who doesn’t know the underlying business. I’m not going to pay for them to learn that.
It’s pretty obvious you were heading in the direction of technology law, but how did you end up at Cooley?
Because Apple doesn’t hire lawyers out of law school, I knew I needed to go to a firm. Cooley, Fenwick, and Wilson Sonsini were among the California firms that interviewed at UVA. Because I was on Law Review, Cooley interviewed me. I had offers from other firms in northern California but ended up at Cooley for a variety of reasons.
How did you go from Cooley to eBay?
Again, incredibly lucky. I was a second-year associate at Cooley. Every other Friday I had to be there at 8 am for an associates meeting. On one of those Fridays my private line rang at 7:45 in the morning. I picked up the phone, because the only person who has the number is my wife. This woman says, “Hi, are you Brad Handler?” She was a recruiter for eBay. One of the other associates had given her a list of everybody’s private number. She said, “They want to hire someone to run their business development group and they want that person to be a lawyer. Would you be interested?”
I met with her and the eBay team, then only about 20 people. Afterwards, they said, “We want to make you a job offer.” I said “Great. What is it?” They said “We want you to run business development.” I said “Thank you for the offer, but you don’t need me to run business development. You actually need a lawyer in house. You guys are going to get crushed if you don’t have a lawyer in house.” They said, “No, we don’t need a lawyer. We have Heller Ehrman.” I said, “That’s not going to cut it. You actually need an in-house lawyer.” They said “No, we don’t.” I said “Well, it was nice to meet you. Thank you and good luck.” And we went our separate ways.
A few months later, I get a call from the same recruiter for eBay. She said “Would you be interested in a job if you were both the attorney and [ran] business development?” I said, “As long as I had the opportunity to make sure from a legal standpoint everything was good, I could do that. I’d need some resources on the business development side.” She told me that I could hire for that and that I would have a budget to keep Heller to do some of the stuff I couldn’t otherwise do since legal wouldn’t be full time. So I said, “Okay, great. So, when do I start?”
I started in October 1997 and one of the first things I learned was that the recruiter had tried to recruit a number of other and more senior associates at Cooley. When that didn’t work she had gone to Wilson Sonsini. She found a guy who was going to take the job, but then his wife got pregnant and eBay didn’t have health insurance. He told eBay he couldn’t take the job. So they called me back, and that’s how I got to eBay.
On my very first day there, Onsale [a rival business-to-business auction site] spammed the database of eBay users to launch their own person-to-person auction site. So on day two, we had to pursue legal action against them and as a result, I never had to worry about splitting my time between business development and law. I was always law.
How long were you at eBay?
I started in October of ’97 and I left in December of ’01, and then stayed on as a consultant for another 18 months to help them transition.
You obviously worked through the whole tech bubble. What did you find most enjoyable in those eight years and what was your nemesis on the dark side?
I also started a government relations group at eBay. Silicon Valley companies didn’t have government relations and I felt pretty strongly that we needed to have a presence with policymakers on issues regarding the Internet and tax and liability and all that kind of stuff, so we had a seat at the table for things like the CDA and the DMCA.
In six years you had a lifetime of legal experience. Then you decided to become an entrepreneur. How did that happen?
I have three daughters. Our 11-year-old was born in March of 2000. If you look at the financial press in March of 2000, there was one big story — the merger between Yahoo! and eBay, which never happened. I missed a lot of the first couple of weeks of my daughter Bailyn’s life because of that. So with my second kid I was going to take six months off and work half time. Two days before we’re set to announce that arrangement, the leadership of eBay says, “We can’t let you go half time.” I said “I’ve made other commitments. I committed to teach at Virginia. I’m going to teach at Stanford. I can’t do that.” EBay was not prepared for me to actually leave, so I had to consult for a period of time.
I wasn’t really sure what I was going to do. My brother and I took our families to Hawaii on vacation. We stayed in the nicest suites at the nicest place, and bitterly complained about the accommodations. Then it hit us — why are we doing this? We can solve this problem. My dad was an entrepreneur, and we grew up in an environment of owning your own business. So my brother and I spent May of 2002 in Maui mapping out a business to fill a need that my brother and I had within our own family — how to vacation. That business became Exclusive Resorts, where you have collaborative use of a house with a real kitchen, you send in a grocery list beforehand and get there with all the groceries you need stocked in the fridge. That was the breakthrough idea. Exclusive Resorts and now Inspirato are the answers to real problems that we had.
Having been a lawyer and being an entrepreneur, what did you like and not like about being a lawyer, what do you like and not like about being an entrepreneur, and how would you distinguish the two?
What I liked about being a lawyer was that every problem was different. Every company had different issues. It’s like a little story and each one is different. I didn’t particularly like the law firm hierarchy, though Cooley treats their associates very well. And I didn’t like the fact that you couldn’t control your own schedule.
On the entrepreneurial side, I like controlling whether or not you have a chance to succeed. You can’t control whether or not you will succeed because too many other variables get in the way. But you can control whether or not you put yourself in a position where you have a chance to succeed.
I can’t think of any aspect of being an entrepreneur that I don’t like. I don’t necessarily embrace every aspect of it — I don’t like telling people that they don’t understand the vision and this might not be the best fit for them, but I don’t hate it, either.
I like mentoring people. I’m a big believer in walk-around management. When I started at eBay, I was the only lawyer. When I left, there were 50 people in the department and every day I would walk around and talk to every single person. How are you doing? What are you working on? What can I help you with? I’m doing the same here at Inspirato. I always hire people who know more than I do about whatever it is we’re hiring for. You can learn a lot from the people you hire. Always hire someone better and smarter than you. No matter how smart you are, you can’t know everything and you certainly can’t know it in context.
We have students in the Law School who are interested in entrepreneurial law as well as some of whom think they would like to be entrepreneurs. Any advice you would give them?
I think that the best entrepreneurs are those who’ve been through law school, not business school. Law school teaches students how to evaluate critically lots of different options, but they are not great risk-takers by nature. It’s not what they were taught. But if we could just teach them to be a little better at taking risks they would make much better entrepreneurs. That said, law school students or lawyers thinking about becoming entrepreneurial need to really believe in what they’re doing. If they don’t, the only way they’ll succeed is through pure luck.
For example, I would be a terrible entrepreneur for, say, a new router. If someone asked me to go and be a founding partner on a new company that makes routers, I would say I don’t know that area and am not passionate about it. But the companies that I’ve started, Exclusive Resorts and Inspirato, are all about traveling with your family. I understand that.
It’s not enough just to want to be an entrepreneur. The question is, what do you want to do? Whatever that is, is it something you can make entrepreneurial? The folks who start nonprofits and charities are very entrepreneurial, just as entrepreneurial as the guy who starts the next new social network. All successful entrepreneurs have a passion about what they’re building. The people who are not successful entrepreneurs are those who do it just because they think it’s the easiest way to get rich. One or two of them might succeed, but as a group they are not going to be successful.
Look at my story. It’s lucky that I went to Virginia. It’s luckier that I got on the Law Review, so it’s lucky that I got to Cooley. It’s unbelievably lucky that I got a call from eBay and then it’s even luckier that the guy who’s supposed to take the job gets his wife pregnant. That’s how it happened for me. You can’t plan that. So the other thing I always tell entrepreneurs is to put yourself in a position to get lucky, so that you can take advantage of it if it happens. And never believe that you did it based just on your own skill, because it was as much luck and happenstance as anything else.
There were 10 other person-to-person auction companies that started before eBay. Any one of them could have won the space, but it happened to be eBay that did it. So the other advice I give to entrepreneurs is when it fails (and 90 percent of entrepreneurial ventures do fail) it doesn’t mean you are a failure. A lot of entrepreneurs take it very personally when their project fails. They internalize it and think that whatever they did didn’t work. It may be that they made bad decisions, but there is really no way to know, so you can’t blame yourself for the failure of the business. You can only blame yourself if you failed to put your all into it.
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