Etsy.com, the New York-based online crafts marketplace, priced its shares at US$16 ahead of its Wall Street debut yesterday.
The share price valued Etsy, known for handicrafts and strong social values, at US$1.78 billion and promised to raise about US$267 million.
The stock was set to trade on the NASDAQ market under the symbol “ETSY.”
Photo: Bloomberg
Etsy was founded in an apartment in Brooklyn, New York, in 2005, and pegs itself as the “antidote to mass manufacturing” by selling handmade and vintage goods.
“I intend to keep our unconventional operating philosophy as we become a public company,” chief executive Chad Dickerson said in a letter included with the Etsy regulatory filing.
Etsy plans to maintain its status as “a certified B Corporation,” which seeks to contribute to solving social and environmental problems.
However, only two B corporations are publicly traded, reflecting the apparent contradiction between social values and responsibility to shareholders.
“Investors want a company to do good, but they don’t want too much at the expense of getting the profit they are looking for,” said Kathleen Smith at Renaissance Capital, a research firm that specializes in initial public offerings.
“There could be a little bit of contention between the investors’ constituency and social responsibility,” she said.
In the past year, Etsy reported a loss of US$15 million as it ramped up marketing efforts. However, it has generated sales on the platform of US$1.93 billion, one-third of which came from outside the US market.
Last year, Etsy boosted its international presence with the acquisition of French-based rival, A Little Market.
Etsy has gained a reputation as a hipster, artisanal version of eBay, featuring a large number of vintage and handmade items. However, critics say mass-produced goods from China and counterfeit items make their way onto Etsy despite the firm’s efforts.
As of Dec. 31 last year, Etsy had 1.4 million active sellers and 19.8 million active buyers, with a large number of both coming back to the platform.
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