Last week, Etsy — the internet’s craft fair — announced its acquisition of London-based shopping platform Depop for $1.625B in a “mostly” cash deal.
It’s Etsy’s largest acquisition ever, and it’s significant for 2 reasons:
- It’s a massive boost of confidence for European ecommerce startups
- It signals an acquisition appetite for companies marketing to Gen Zers
C’mon, the kids have style these days
Depop is a marketplace for buying and selling secondhand clothing via an app.
What sets the company apart from similar marketplaces is its intentional Gen Z appeal. Its sellers operate like influencers, often modeling their own clothes and using platforms like Instagram and TikTok to increase the reach of their Depop storefronts.
The Z-sauce is working, per the company’s 2020 numbers:
- $70m in revenue
- 4m buyers and 2m sellers, ~90% of whom are under 26
The big business of secondhand fashion
While Etsy is known for its marketplace of handmade goods and things your drunk aunt impulse buys, the Depop acquisition gives Etsy a seat on a larger macrotrend: secondhand clothing.
According to a report from ThredUp — another thrift wunderkind — the total market for secondhand clothes is expected to reach $64B by 2024, rocketing from $28B in 2019. Plus, Depop touts the sustainable benefits of reducing clothing waste, something that resonates strongly with climate-minded young’uns.
