Etsy IPO: how to sell and not to sell at the same time

The Etsy website, on which anyone can sell hand-made things, has always distanced itself from the notion of “commerce” when belonging to e-commerce: for many of its users, it’s very important to “buy a thing right from its creator, a living person, and not a soulless corporate cars". In a sense, Etsy makes money from the fact that users feel that earning is not important to him.



Now, the company decided to enter an IPO - and this means that it will report to shareholders with their financial interests. How not to scare away users who can decide that now there is the same “soulless corporate machine”? This question is now very relevant now, in the era of sharing economy and on-demand economy: a lot of projects from Airbnb to BlaBlaCar become intermediaries between users, providing “human warmth”, and as they grow they will also have to prove that they are still “a fire, around which friends have gathered, ”not“ sterile office space. ”

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Part of the answer lies in the past of the company: it is possible to go quieter on IPO in the event that before that it had already become significantly “corporate”, and this did not turn out to be an obvious mistake. In the history of Etsy, such an episode has already occurred: from the moment of its foundation in 2005 and until 2013, the rules of the site allowed to sell only the hand-made ones, but as the project grew, the things of factory-made were also allowed.



Yes, it caused a sharp surge of discontent on the part of users. Yes, some because of this, some sellers and buyers left to the site, who were previously loyal users (including those who were present at it from the very beginning). But in general, the decision led to the growth and development of the site, and not to a fall in indicators, and he generally retained his image, and did not begin to be perceived as “one of many.” Having seen a positive result of such a decision (which allows “to return everything back” in case of failure, albeit with losses), it is much easier to accept the irreversible.



The second way is to immediately explain to future shareholders that certain conditions are important for success, and you shouldn’t try to use all means to get into the noble ladies, because then you will only stay at the bottom of the trough. Etsy is doing just that now. In the papers filed by the company for entering the IPO, the word “authentic” and its derivatives are found 24 times, one of which is in the “risks” section with a direct message: “if it cannot be maintained, the ability to retain existing participants and attract new ones can suffer” .



In addition, the company directly states “commitment to values ​​is our inherent quality” and also directly warns: first, this means that for the sake of long-term success, you will have to sacrifice short-term benefits (for example, not to allow any products that are incompatible with values ​​of the company, although their sale would bring profit), secondly, not the fact that this long-term positive effect will follow at all (at the moment the company is unprofitable, and it is assumed that as it grows, this will change, but there are no guarantees).



Finally, the third way to enlist the support of the community is to show that access to an IPO contributes to specific good goals. Etsy is dominated by women in the audience, and the company has long been putting measures in place to increase the proportion of women among its programmers: the struggle for equality in IT, being waged by other companies like Google, fits wonderfully into its “human values”. And now it has become known that the company intends to spend $ 300,000 of the money received during the IPO for the etsy.org charity initiative that encourages women to become entrepreneurs - the amount makes this step quite symbolic, but for the audience of the site it can still be significant.