5 Crafty Entrepreneurs Jolly With Etsy Success
The seven-year-old company is still a growing cult. More than 800,000 creatively inclined entrepreneurs now use the site to reach more than 20 million registered users globally. For sale is unique accessories, clothing, even furniture.
Many who sell on Etsy aren't looking to grow into large-scale companies or develop the newest patented technology. Instead, these entrepreneurs, mainly women with multiple sources of income, want an inexpensive storefront for their handmade, artisanal goods.
Before it was launched, artist and founder Rob Kalin was looking for a place to sell his own creative projects. He tried eBay (EBAY) , but didn't think his art was a fit there. He realized there wasn't an online place available for others like him and in just three months, he partnered with two engineers to create, design and write the code for Etsy.
"There was no business plan, no grand strategy," says Matt Stinchcomb, Etsy's vice president of values and impact (a fancy way of saying customer-service relations). "Just a need for something like it." Stinchcomb was Kalin's roommate at the time and Etsy's first employee.
Sales on the website this year were up to $700 million as of early November, up more than 30% for all of 2011, according to the company. On Cyber Monday, more Etsy sellers had sales than on any other day in company history, with a third of the total sales coming from first-time buyers.
"With the current momentum, in 2013 we will begin measuring sales by the Etsy community in billions and sellers in the millions," the 400-employee company says.
While Etsy may be a growing destination to find the perfect hand-painted jewelry box, the company is striving to be more than just another Amazon (AMZN) .
Besides being a marketplace where small crafters can sell their items to customers around the world, the company offers a growing amount of support and education, such as SEO best practices, product photography and accounting.
The site charges 20 cents to list each item for four months. Additionally, each time a product sells, Etsy collects a 3.5% commission whether the price of the item is $4 or $400. Etsy does have other ancillary revenue sources, such as an advertising program for sellers to promote their products. It also plans to launch a wholesale platform in the first quarter of 2013, where sellers will be able to connect with boutique owners to broaden the exposure of their goods.