Etsy ($ETSY) is the latest company to benefit from the ecommerce boom. The online marketplace, known for its handmade and vintage items, has exploded in recent months as Americans have done more online shopping than ever during the COVID-19 pandemic.

The company’s recent addition to the S&P 500 index (over the likes of Tesla, which is still not included) has cemented its role as a key player, both in ecommerce and New York-based startups. Its share price has exploded since April after several quarters of steady growth, and projections point to sustained growth in the coming months. But Etsy wasn’t always this popular.

According to Matt Turck, a partner at venture capital firm FirstMark, Etsy was considered a “semi-disappointment for the NYC ecosystem” when it first went public. Turck said in a tweet that the company was “a rare (at the time) NYC startup to go public, only to end up [with] lackluster stock performance.”

When Etsy first went public, in April 2015, its performance was less than promising. Its valuation, however, was $1.8 billion, and it was seen as the potentially “iconic” IPO the New York startup scene longed for but hadn’t found. Within a month, its stock dropped 8% and didn’t budge past $15 for over two years. 

Just after its IPO, investors sued the company for alleged fraud, claiming they were unaware that 5% of its 40 million products for sale were actually infringing on copyrights of products elsewhere. Five years later, after a shakeup in management and an already growing customer base, the pandemic gave Etsy the final push to take off.

Etsy’s app store ratings have been steadily climbing since September 2019, but its share price took off as the pandemic triggered a boom in online shopping (the color change indicates an app store update). While app store ratings hovered around 42,000 pre-pandemic, they’re up to 1.44 million as of September 2020. Etsy’s stock shot up from its lowest price this year, $31.69 on March 20, to an all-time high of $135.5 on August 5.

Thanks to an influx of 18.7 million buyers, from both new and long-dormant accounts, Etsy’s second quarter revenue has grown to $429 million, a 137% increase year over year.

The ecommerce company beat out a bigger name to the S&P: Tesla ($TSLA). To make it into the index, a company must have four consecutive quarters of profitability. While Tesla has done this, and nearly hit 400% growth in the process, committee members weren’t satisfied. 

Etsy’s steadier growth, on the other hand, is the likely cause of its inclusion. If it can maintain its incredible climb, Etsy could become the iconic startup New York has been waiting for.

About the Data:

Thinknum tracks companies using the information they post online, jobs, social and web traffic, product sales, and app ratings, and creates data sets that measure factors like hiring, revenue, and foot traffic. Data sets may not be fully comprehensive (they only account for what is available on the web), but they can be used to gauge performance factors like staffing and sales.

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