Part 1 of this 2-part article reported on concerns raised by members over what kind of organization PESA (Professional eBay Sellers Alliance) is and its accountability in money matters (http://www.auctionbytes.com/cab/abn/y06/m11/i13/s01). In addition to concerns about financial transparency, several members voiced concern over ECMTA, started by PESA Executive Director Jonathan Garriss.

Garriss said he formed ECMTA and that his operating corporation has full ownership. The acronym stands for E-Commerce Merchants Trade Association, and he said the new organization will focus on ecommerce initiatives and lay the groundwork to extend the reach of PESA. On its homepage, it states "ECMTA has joined forces with the Professional eBay Sellers Alliance (PeSA) the leading Trade Association of Top eBay sellers! More details will be available soon." While PESA actively promotes ECMTA to its members, ECMTA does not mention a relationship with PESA on its About Us page (http://www.ecmta.org/ecmabout.cfm).

Garriss said ECMTA was not set up to make a profit, but he had learned from his experience at PESA that there were no benefits to filing as a non-profit with the IRS "since we don't make a profit." According to its website, ECMTA charges no fees for basic membership, and $19/month for premium membership, which includes the following:

• Healthcare and Human Resources Management (payroll, 401k, compliance, etc) best-practices and recommended programs.
• Economical ways to promote and market your business.
• Professional web, newsletter and promotional design work.
• News Alerts on important developments in e-commerce.
• ECMTA Deals Newsletter - a periodic mailing on products, services, promotions and savings opportunities from our partners.
• Many more ways to grow and improve your business.

eBay PowerSeller and former PESA member Steve Grossberg, who sells on eBay as 1Busyman's Budget Video Games, said he feels ECMTA is getting marketing exposure to PESA members unfairly, since PESA does not allow sponsors to solicit its users (outside of Summit events and logos on the PESA website). He also said he feels it is inappropriate that ECMTA, owned by Garriss, is negotiating sponsorships with the PESA board, of which Garriss is a member. He is also concerned that ECMTA may be a competitor to some of PESA's sponsors, which provide services to online sellers. On the top of ECMTA's home page, it calls itself, "Your source for e-commerce tools & solutions."

Grossberg said Garriss did not announce the formation of ECMTA and that he only learned of the new organization through an article published in AuctionBytes.

Long-time PESA member Suzanne Hallam of aGenius-Marketing.com expressed concern about the for-profit status of PESA, a group she said she wants to see stay together. She said she spent hundreds of hours volunteering for what she thought was a non-profit organization, including designing the PESA website at no charge. She also said, "I was upset because (ECMTA) appeared to be a conflict of interest."

Hallam herself has gotten business through personal networking with other PESA members, but she said that business did not add up to more than $5,000. Hallam expressed concern that members who ask for accountability have been suspended. She named three members who were suspended because they would not quit asking questions, but, she said, she "can't blame them for getting riled up." Other members have complained of censorship on the PESA discussion boards.

Garriss said of Steve Grossberg's criticism of ECMTA, "I have heard him use the rationale that since I formed ECMTA, he could form his own Group. However, I think it is important to note that ECMTA is not a discussion forum and that ECMTA is working on specific benefits that do not compete with PESA or involve eBay."

Grossberg ran for the Board of Directors twice in the past year. Both times, he lost. "His campaign platform did not resonate with the members," Garriss said.

Garriss and Grossberg agree that Grossberg was suspended from PESA after forming a private eBay Group called TRUPESA, which he later renamed Internet Merchants Association. However, Grossberg said he merely created the Group and had not invited anyone to join until after he was suspended from PESA. Garriss said PESA removed Grossberg when he started a competing discussion group on eBay and solicited members to join his Group. Grossberg insists his intention is not to splinter PESA, but to unite PESA.

So Who Owns PESA?
There are some issues PESA has to address in terms of ownership shares, Garriss said, stating that corporations with over a certain number of shareholders have to pay state registration fees. Garriss said the Board just decided to give up nonprofit status recently, and started the process of distributing the shares to the membership. The Board had to determine how to distribute shares - to all members, or to the people who rolled up their sleeves for the organization. The Board identified 100 (of the approximately 1,000) members, and that's where they will distribute the shares, he said. "Right now, we don't have answers. We're trying to see if we can put together a trust to hold the interest of the shares of the corporation."

Members have stated they are confused about what kind of organization PESA is, and whether it ever was a non-profit organization.

Garriss said of EMA, which operates under the name of PESA, "the Corporation is a C-Corp and not an LLC so there are bylaws rather than an operating agreement. The bylaws are posted for the members here, http://www.gopesa.org/bylaws.htm. We have not updated them recently to reflect the new members of the Board."

Over the last two months, Garriss said the PESA Board has worked on the roadmap. "We've had to cut bait - things were holding us back." He talked about the challenges of running an all-volunteer organization whose members are short on time. Is he frustrated having to deal with criticisms in a volunteer position? "The Board is certainly frustrated, directors spend a lot of time on PESA volunteering and lending their resources." For example, he said directors have flown their company employees to help run PESA summits at no cost to PESA. "The board does feel a bit frustrated - they were all elected. Should politics outweigh the tangible things we are trying to do?"

Garriss talked about initiatives PESA has been working on. He said, "If (members) don't see results in the next 2 months, I'll leave PESA. Should I spend time on Bylaws or on creating revenue opportunities for members? Eighty PESA members have gone out of business this year, there is a need to focus on revenue. The politics is not it. But, I guess that's politics."

In talking to various PESA members, some who might be called "disgruntled" and others not easy to label, several points came across. Everyone mentioned the value that PESA brings to members. The words friendship, kinship and bonding were mentioned several times. It seemed everyone wants the group to stay united.

In addition, no one claimed or even hinted that they felt monies were being misappropriated - many made a point of saying they believed no one was lining their personal pockets with PESA funds. But the call for accountability in money matters was unanimous and emphatic.

Jonathan Garriss said, "The communication challenge is the biggest issue the Board has." It certainly seems some PESA members agree.

Professional eBay Sellers Alliance Timeline

August 2003: Joe Cortese, an eBay Platinum PowerSeller and owner of NobleSpirit.com, creates an eBay Group called eBay Elite

May 2004: eBay Elite holds first summit in New York

July 2004: eBay Elite announces name change to Professional eBay Sellers Alliance (PESA)

July 2004: PESA announces it will be officially incorporated and will become a non-profit organization as a trade association

November 2004: PESA holds the group's first elections. Barry Anderson of eBay seller banderson-at-fuse was re-elected to the Board of Directors. Shelly Hudson of Shoetime was elected to a fourth seat, joining Joe Cortese of Noble Spirit, PESA Founder, and Jonathan Garriss of Gotham City Online, PESA CEO

June 2005: eBay North America President Bill Cobb participates in PESA charity auction during eBay Live conference

October 2005: eBay North America President Bill Cobb gives keynote address at PESA Summit

January 2006: Jonathan Garriss temporarily steps down from his position as Executive Director of PESA

September 2006: Yahoo COO Dan Rosensweig slated to give keynote address at PESA summit

September 2006: PESA leadership makes public the formation of a new organization called E-Commerce Merchants Trade Association (ECMTA) to focus on ecommerce initiatives and lay the groundwork to extend the reach of PESA.

October 2006: PESA Executive Director announces it will begin charging membership dues. The Board reveals its decision to stop pursuing non-profit status for the organization.

November 2006: Debate within PESA membership over tax-status and other issues spills over into industry discussion boards in early November.