Etsy is offloading Depop to eBay for $1.2 billion, marking one of the biggest marketplace deals this year. The announcement sent Etsy shares soaring 14% in after-hours trading as investors cheered the company's decision to refocus on its core handmade goods marketplace. The deal comes nearly five years after Etsy acquired the Gen-Z favorite fashion resale app, signaling a strategic retreat from its multi-brand ambitions.
Etsy just handed eBay the keys to one of fashion resale's hottest platforms. The $1.2 billion deal for Depop represents a stunning reversal for Etsy, which paid $1.62 billion for the Gen-Z shopping app back in 2021. Wall Street's immediate reaction? A 14% surge in Etsy's stock price as investors applauded the company's decision to streamline and refocus on what made it successful in the first place.
The numbers tell a story of strategic recalibration. Etsy's taking a $420 million haircut on the sale price, but investors don't seem to care. The market's voting with its wallet, betting that a leaner Etsy focused solely on its handmade goods marketplace is worth more than a scattered multi-brand conglomerate. According to the CNBC report, Etsy executives framed the sale as a way to "focus on its core marketplace business."
For eBay, this is a calculated play for younger users. Depop's approximately 30 million registered users skew heavily Gen-Z, a demographic that's been buying and selling vintage streetwear and Y2K fashion on the app for years. While eBay's been trying to shed its reputation as your uncle's auction site, Depop arrives with built-in cultural credibility among exactly the audience eBay needs.
The timing reveals the pressure Etsy's been under. When the company went on its acquisition spree starting in 2019 with Reverb, then Depop in 2021 and Elo7 shortly after, the strategy was clear: become a "house of brands" serving multiple creative communities. But the execution never quite clicked. Depop operated largely independently, its edgy secondhand fashion aesthetic never quite meshing with Etsy's handmade craft vibe.
