If global craft market Etsy goes public this year it will be an interesting test to see how the brand can balance their explicit social mission with shareholder revenue expectations.
Founded in 2005, Etsy, is like the handmade and craft version of Ebay. It’s an amazing online marketplace that amplifies the concept of the local craft market globally but the brand is also rooted is a solid belief system that drives everything they do.
10 years on, Etsy has grown from a little online craft market to connect 54 million members and last year they generated $US1.93 billion in sales. Now the company has filed for an initial public offering of stock valued at up to $100 million.
Etsy’s mission is “to re-imagine commerce in ways that build a more fulfilling and lasting world”. They have committed to “building a human, authentic and community-centric global and local marketplace” and “using the power of business to create a better world through our platform, our members, our employees and the communities we serve.” They say that their mission “is woven into the decisions we make for the long-term health of our ecosystem, from the sourcing of our office supplies to our employee benefits to the items sold in our marketplace.”
This is not just talk. Etsy are a certified B Corporation which means they are certified “to meet rigorous standards of social and environmental performance, accountability, and transparency”. In their submission to the SEC they state that any loss of their BCorp status would be have a significant negative impact on their brand.
While there are more than 1,000 BCorp certified organisations globally, none are public companies in their own right. Etsy will be the first to test how investors react to this. However, the real test will be when Etsy has to report back to shareholders and how they manage their expectations for financial growth and returns.
Forrester analyst Sucharita Mulpuru told Associated Press “It’s going to be a tall order for a management team in the future to be true to its core company values while also delivering shareholder value.”
In the face of growing competition from the online marketplace heavyweights such as Amazon and eBay, Etsy will no doubt get significant pressure to compromise their beliefs. However, staying true to their beliefs is why they have been so successful.
Hopefully, Etsy will continue to be a standout organisation and continue to set an example in how brands should behave, regardless of whether they are public or not.
Managing Partner, Strategy