Brooklyn-based handcrafts store Etsy which launched back in June 2005 (and I distinctly remember purchasing a T-shirt from when it first crossed my radar) has announced it has raised a $27 million round from existing investors Union Square Ventures and Hubert Burda Media, and Facebook investor Jim Breyer of Accel Partners. From an idea to a company that’s grown to 50 employees in the last couple of years, it’s another milestone for the company.
Joining the board of Etsy will be Jim Breyer, who’ll be alongside Caterina Fake of Flickr and Fred Wilson of Union Square Ventures. Having run a break-even since its launch — the revenues of which impressively serves its 50 employees — this is the first time the company will have resources to expand and grow alongside its core business. As co-founder Rob Kalin outlines in this blog post, apart from hardware costs, a significant portion of the investment will be used to fund new features and product expansion — things like a new checkout system, revamped search feature, and expanding to other currencies and languages.
It’s hard to imagine how far that “neat idea with a slick design” I visited back in 2005 has gone to be. And it’s rightly so. What seemed to many (including myself) like a very niche idea, now produces million dollar revenue figures. For sticking with the idea alone, let alone getting it out to the world, having a viable business model, and following a one-of-a-kind vision — the credit and stature of Etsy is well-deserved.
What’s interesting to me is after getting this far, and now with a (lead) Facebook investor onboard, how much growth they will be able to sustain. Certainly, the idea — an online store that sells hand-made goods from people all around the world — has potential to appeal a much broader audience, and while doing great in terms of revenues, is yet to hit critical mass. For example, my mother — as well as I’m sure yours — would love this site, but I can’t see any way she’d find out about it except for me telling her. Getting to a profitable business is one thing, and reaching critical mass is another. The question is, now with the added resources, will Rob and his team be able to carry out the challenge? Certainly, some great rewards wait on the other side.