Shares of Etsy, an online marketplace for handmade goods and craft supplies, more than doubled in their debut yesterday, valuing the company at around $3.88bn.
The New York based e-tailer was founded in 2005 by Robert Kalin, a carpenter who struggled to sell his wooden computers and so created Etsy to do so. Kalin left in 2011 but the website has grown into a community and has even been compared to online giants Amazon, eBay and Alibaba.
Etsy has 29m items listed on its website including jewellery, stationery, clothing, home goods, craft supplies and vintage items, most of which are handmade. Revenue is generated via listing fees and commissions on sales as well as from its advertising platform, payment processing and shipping services.
Etsy had 1.4m active sellers and 19.8m active buyers as of December and revenue rose 56% to $195.6m in the year ended 31 December. Last year Etsy customers bought £2bn worth of goods.
Etsy's shares were up 115% at $34.48 in late morning trading yesterday but the arts and crafts pureplay has yet to turn a profit and has advised it may never do so because of its commitment to social responsibility.
In a blog post, CEO Chad Dickerson cited that investors who decide to buy shares in Etsy realise that the it’s focused on more than just profits.
"The investors we met on the roadshow understand that the key to Etsy's long-term success is building on and extending what has made Etsy successful to date: an inspired community of creative entrepreneurs, buyers who want to buy unique merchandise that they can't find anywhere else, and a values-led community-based business that focuses on the long term," he wrote.