Thought I would get some discussion going on it: -How do you feel Etsy was able to overcome the Chicken and the egg problem? -Were they able to just find a great market that was being underserved by eBay? -Do you see other markets that could flourish by being "spun" out of eBay? -How were they able to market themselves to not only shopkeepers but consumers as well?
I am sure there are other good questions as well..
Anyone that is caught in limbo between eBay and Craigslist and thus resorts to flea markets or other 'in-person' gatherings for sales are good targets.
As far as I can see, actually cultivating community has been a big shortcoming for Etsy. The 'teams' section of the site is very underdeveloped (it's been the same for years and isn't tied into the rest of the site very well). The forums are frequented by the a small group of focused people, mainly all sellers, and the tone on there has been very negative for years. The in-house messaging system ('conversations') is extremely lacking, with no serious organization tools for your messages. The shop/item favoriting system doesn't function as a social networking 'friends' system, it's geared only towards shopping.
Etsy sellers tend to network through their own blogs (mainly on blogger), independent craft blogs, and use Twitter for communication.
Wow, where'd you hear that? :)
But tell Gerry I said to pop on over here and chime in.
My wife loves Etsy. She's tech-savvy, loves to craft, loves fashion, and loves to shop.
My guess is they overcame the chicken/egg problem because a lot of their sellers are also buyers–which allowed rapid initial growth. Mix in some good PR, people complaining on Ebay forums, VC connections, and there you go.
http://www.doublex.com/section/work/etsycom-peddles-false-fe... ("There are virtually no male sellers on Etsy")
They probably get less attention in the tech space because their user base is mostly women.
The number of items on Etsy has increased by 100 times in the past few years, but the lens through which you can see the items has stayed the same size - search pages of 20-30 items. Few people are going to page through more than 20 pages of results.
Basic search has improved significantly since Chad Dickerson came on board, but I think even the tech staff acknowledges that there's a long way to go.
One major problem is the tagging system, and the lack of true categories. It used to be that your first tag functioned as the 'top level category', but they didn't make this clear in the listing creation step. You could (can?) also choose contradictory tags/categories with no problems. The top level categories are rather disparate conceptually, and aren't particularly well chosen (i.e., 'Quilts', with 24k items, has it's own top level entry, same as 'Jewelry' with 1.4 million, and art, with 500k). Also, the tags and titles are completely in the hands of sellers, some of whom mis-label items inadvertently or intentionally. It's a bit of a tricky deal.
Their board is Jim Breyer, Fred Wilson, Caterina Fake and Rob Kalin (founder, CEO).
They are profitable as of earlier this year, founded in 2005, based in Brooklyn, and put on a good show fo' sho'.
One odd side effect of this passion and sense of community is that sellers see selling on Etsy as a hobby rather than a profession, and their effective compensation reflects this.
As an aside, if you are in the market for an external hard drive, this is the most beautiful one I have ever seen: http://www.etsy.com/listing/47397822/walnut-and-maple-wood-e... (I'm not affiliated with that seller in anyway, I just dig his product).
This, to me, was the win, not going after a piece of eBay's pie.
Rather than asking "Other markets that could flourish by being spun out of ebay," I would search for more organizations helping 'micro-entrepreneurs' (i.e. from the bedroom to a small booth rental) make their living.
I don't care for etsy as a customer but it's a great company from a business standpoint.
