Etsy acquired Elo7 on July 6, 2021, for $217 million, and today it announced it agreed to sell the Brazilian marketplace, which launched in 2008, to Brazilian firm Enjoei S.A. for an undisclosed amount.
At the time of the acquisition 2 years ago, Etsy said Elo7 shared its mission to ‘Keep Commerce Human’ with a two-sided marketplace strategy focused on creative microentrepreneurs. It called it an “early stage business that we believe can leverage Etsy’s proven value creation roadmap to drive further growth and profitability.”
As it had with its acquisition of Reverb and Depop, it kept Elo7 as an independent operation “while benefiting from shared expertise in product, marketing, technology, and customer support.”
In Tuesday’s SEC filing, Etsy CEO Josh Silverman stated:
“Although the Elo7 team has worked very hard to build a beloved marketplace and vibrant community in Brazil, we have not seen the performance we had anticipated when we made this acquisition two years ago, in part due to the macroeconomic environment.
“Given the circumstances, we believe this is the best outcome for Etsy, our stockholders and other stakeholders, and Elo7 and its employees, as well as the Elo7 buyer and seller communities. Following the close of the transaction, anticipated in the third quarter, Etsy’s House of Brands will include the three scaled, global marketplaces Etsy, Reverb, and Depop.”
Etsy said it would provide updates during its second quarter 2023 earnings call, which is scheduled to be held on August 2.
*** Like Elon Musk and Twitter ***
And WHY won’t Etsy disclose the amount they sold Elo7 ?
I’d bet money they sold at a loss!!
So back in 2021, Etsy jacked Seller fees from 5% to 6.5%. Then Etsy announced they would charge Sellers an additional 12% when sales come from outside of Etsy…which is a HUGE profit margin squeeze for Sellers.
Shortly after, Etsy purchased 2 companies for nearly all cash, one being Elo7.
Instead of investing into U.S. made Etsy with the strongest consumer on the planet, Etsy decided to rape Sellers in fees just to invest into poverty stricken Brazil. I KNEW this would be a bad investment.
It’s like Elon Musk and his wasteful spending on Twitter. And to think, Etsy could have spent that money into things like Customer Service, or better yet, to keep fees low so that Etsy sales won’t stagnant as they are today.
What a thoughtless and clueless company.
Etsy got greedy and it bit them in the butt.
Love it!
I lost 2 milling machines to Brazil.
Had the buyer told me where they were going, I never would have sold them to him.
Selling America out shouldn’t be an option..