Last week, Justmeans reported on the news that Etsy, the online seller of artisan goods, a business that aims to balance profits with a social mission, was valued at $1.78 billion, after launching an IPO this month on NASDAQ. Shares closed at $30 dollars, almost twice their initial price of $16. In an unusual IPO restriction, Etsy capped the value of stock that investors could buy at $2,500, to give access to as many investors as possible, including the small businesses that market their products through Etsy. Overall, the company’s financial results have been impressive, where sales have risen 56 percent last year over the previous year, to $195 million dollars, clearly showing there is demand within the niche they operate in for unique handcrafted, vintage goods.
Etsy, a U.S. Brooklyn based company, founded in 2005 by Robert Kalin, has grown into a thriving online community offering over 29 million handmade items from jewellery, stationery, clothing, crafts and home goods. It is a certified B Corp company, a new American corporate form designed to protect a firm with an explicit social mission from undue demands from shareholders. As a result, Etsy is a business that offers its employees stock options, paid volunteer time, paying part-time workers fees that are 40 percent above local living wages and teaches local women and minorities programming skills. It’s a platform with a real mission to ‘humanise’ work and commerce that has established Etsy as the leading business of the artisan movement.
Etsy has a real social element that other online selling platforms like eBay have not mastered: teaching its sellers about business, running an online bulletin board and offline meetings in places, like Brooklyn, San Francisco, London and Berlin. In November 2013 Etsy published a study based on a survey of 5,500 of its American sellers, of whom 88 percent were women, where 97 percent worked from home and 74 percent said they considered their Etsy shops to be businesses. Most said they used Etsy to top up earnings from other work, while 18 percent said that it was their full-time job. These statistics support a recent trend, particularly among women and under-30s who want to work from home, with flexible hours, based on a personal interest.
The rise of Etsy says more about consumers than about sellers, as people are getting tired of the same old big-box retail products and are attracted to the life stories of the sellers whose products they buy. This successful online selling platform has embraced technology and business models, giving craft makers and artisans a better chance of surviving in a very commercial world.
It is important to the Etsy community that the business stays true to the idea that you are buying from a person, not a company, and going public gives Etsy an opportunity to test whether a business type like this can withstand the pressures of the stock-market.
Photo Credit: Etsy Blogs