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Etsy has purchased the peer-to-peer social shopping app Depop for $1.6 billion.
Depop has seen a surge in popularity in recent years. The peer-to-peer selling application allows people to sell clothes and make money from their unwanted items. The app has been particularly popular with Gen Z, in fact, 90% of its users are under 26.
Now, it has been announced that Etsy has purchased Depop for $1.625 billion in cash, equivalents and investments.
Given Etsy’s online marketplace, purchasing a digital selling platform would make sense in terms of branding. Not only that, but it could be a fruitful investment as Depop continues to grow in popularity.
The deal is expected to be finished by the third quarter of this year and is reflective of the growth of clothing resale platforms. This increase in popularity has been caused by multiple factors including fashion, a more environmentally conscious market and the global pandemic.
The coronavirus pandemic has led to people staying at home and no longer using traditional avenues to purchase clothes. As a result, the likes of Depop, which allows clothes to be delivered by sellers, has had an increasing appeal. For those who were out of work over the period, Depop has also enabled them to make money as they declutter their wardrobes.
Depop was set up in 2011, but the last year has seen its value skyrocket. Etsy is seemingly hoping this trend continues as they invest in the company.
Speaking about the acquisition, Etsy CEO Josh Silverman said:
We are simply thrilled to be adding Depop – what we believe to be the resale home for Gen Z consumers – to the Etsy family.
Depop is a vibrant, two-sided marketplace with a passionate community, a highly-differentiated offering of unique items, and we believe significant potential to further scale.
While Etsy already has a successful peer-to-peer selling site, it seems it will remain separate from Depop. Depop is set to keep its headquarters in London and continue to act as a largely independent entity.
Depop CEO Maria Raga discussed the future of the company, saying: ‘We’re on an incredible journey building Depop into a place where the next generation comes to explore unique fashion and be part of a community that’s changing the way we shop. Our community is made up of people who are creating a new fashion system by establishing new trends and making new from old.’
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