Etsy IPO: All You Need To Know About Etsy

  • Etsy has filed for an IPO and plans to raise $100 million.
  • Etsy's growing mobile presence and global footprint are positives.
  • Etsy's direct traffic and repeat purchases are positive signals for the platform.


Video Transcript

Hello and welcome to this videograph about the Etsy IPO. Etsy, the popular online marketplace for handmade and vintage products, recently filed for an IPO, in which it plans to raise a 100 million Dollars. Etsy is classified as a B corporation which means that it has social and environmental goals in addition to its commercial goals. The company plans to use 300,000 Dollars of its IPO proceeds to partially fund, a non-profit organization it formed in Jan 2015.

Etsy had a good year in 2014, clocking a near 2 billion Dollars in total sales on the platform. Of this, Etsy earned close to 200 million Dollars in revenue and reported a net loss of 15 million dollars. Etsy generates revenue by connecting 19.8 million buyers with 1.4 million sellers on its online platform. The company earns revenue from 3 broad revenue segments.

Marketplace revenue includes a fee of 3.5% of sale value, which an Etsy seller pays for each completed transaction, and a listing fee of 20 Cents per item. Seller Services, Etsy's fastest growing revenue stream, includes fees for services such as Promoted Listings, payment processing and purchases of shipping labels through the platform. Other revenue includes fees received from third-party payment processors.

Etsy receives over half of its visits from mobile devices, which generate over 36% of gross merchandise sales on the platform. The marketplace, which claims to operate in nearly every country in the world, is available in 10 languages, and generates nearly 31% of its gross merchandise sales outside the United States. Apart from its growing mobile presence, and global footprint, there are other encouraging signs, like its high percentage of direct traffic and repeat purchases. All in all, Etsy comes across as a great platform with a lot of positive indications. But is it a great investment option? Watch our next video to find out.

Author's Note

Following the Etsy S-1 filing in March 2015, the Etsy IPO could be next in a lost list of upcoming tech IPOs in 2015.

Etsy definitely comes across as a good platform. However, the success of the Etsy IPO will depend on its valuations. The company isn't profitable, but there are companies with heavier losses, like Box, which went public earlier this year. Etsy might be a popular platform, but does it make for a good investment? We'll try to answer that question in our subsequent coverage of Etsy, where we'll look at Etsy's growth, profitability and valuations. We'll also look at trends in the company's operating expenses and tell you when we think it's likely to go public.

You can also see our coverage of upcoming IPOs in 2015, the Cloudera IPO, the Dropbox IPO, the Spotify IPO, the Snapchat IPO, the Uber IPO, the Airbnb IPO, the Square IPO and the Pinterest IPO among others IPOs in 2015.

Vikram Nagarkar Vikram Nagarkar   on Amigobulls :

Neither Amigobulls, nor any members of its staff hold positions in any of the stocks discussed in this post. The author may not be a certified/registered investment advisor, and the opinions expressed should not be treated as investment advice.

Buying and selling of securities carries the risk of monetary losses.Readers/Viewers are advised to carry out their own due diligence and consult their investment advisors before making any investment decisions.

Neither Amigobulls, nor the author have any business relationship with any of the companies covered in this post.

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Comments on this article and ETSY stock

Etsy seems to be a good company. The growth is great. Customer service is decent. My worry is they will overprice the IPO and the investors who invest in IPO will hurt themselves
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