Etsy to buy fashion reseller Depop for $1.63B | Hacker News Reader

Etsy to buy fashion reseller Depop for $1.63B

reuters.com

259 pointspseudolus185 comments

Depop is an excellent example of using lots of domain expertise in an area that investors etc would write off as a “lifestyle business” or “not likely to achieve a high ROI” to create what is now a billion-dollar exit.

The founders of Depop have been in the fashion, and fashion retail, business for a long time. They started Retrosuperfuture, which was a cult hit in the sunglasses business (they probably did a lot more, but I never really bothered investigating). The knowledge and expertise they got from that cult hit — along with the credibility and the network among fashion’s “cool kids,” particularly in Milan — gave them a bit of an “unfair advantage” when they went after the at-that-time-already-getting-crowded used clothes business. They also executed pretty well in building exactly what their users wanted.

If you don’t get this business, how it is worth this much money, who they are, etc — no, you’re not some sort of genius humble-bragging that you’re blissfully unaware of such petty little things. You’re just demonstrating that you feel compelled to comment on things you don’t understand and dismiss them because they don’t fit into your myopic worldview of “what’s important.” Fashion is an industry, and one of the largest in the world; anyone who cares about global commerce / the environment / etc should be paying attention to that industry, and to the “circular” trend that remains in its infancy.

I hope the combined company continues to innovate, and that this isn’t just some sort of depressing market consolidation play. This space has a LOT of room for growth.

I'm surprised anyone would write this off. It's a trendy eBay for a specific niche (used/"vintage" clothes). If you can get it to scale (obviously not easy) it seems like it's an easy win and easy to monetise. On the surface a much better investment opportunity than a lot of the stuff we see on HN.

I've used depop a fair amount, I think it's a big leg up over eBay because of it draws some useful features from social media.

The feed allows you to follow and discover sellers whose style suits you, and stay informed of their offerings. You can see who they follow, and so on.

I took a quick look through it. I didn't really get it though. If it's used clothes, why are there people selling large quantities like a business? That doesn't seem like a compatible idea?

The prices seemed lower than average new retail prices by a bit, but not much. There's no obvious way to signal clothes were purchased from depop as far as I could tell...

The only conclusion I can draw is that the used aspect has to be a sort of gimmick used to define the store brand, but in reality most of the money is made on niche sellers doing original products chasing a very long tail of fashion.

Am I terribly wrong?

I live in Japan, thrift stores here sell rare stuff you literally can’t find new in stores, and have scouts who scour the planet for rare finds and ship them back to sell from stores. Sometimes clothes are altered to combine or remix classic styles, too. Prices can match or exceed new goods. And people happily pay for it, there are probably as many used clothes stores as there are for new ones. I’d imagine businesses like this can sell a large catalog on sites like Depop.

I think you’re thinking of used clothes like other used goods - a budget, subpar alternative - but think of it more like, achieving a look from a different era, or collecting something unique, and then it makes more sense.

Yeah they are more like classic cars or relics/jewlry. I wonder if a time piece related site could do well, or if the buyer base is too small.

Website looked like it had some cool stuff. Hard to find good streetwear.

Why exit is thought of as a success? It's kind of like a pump and dump scheme. Does it mean founders suddenly lose their vision and abandon their customers to become an actual product for shareholders?

It is a success because it is a concrete milestone that shows the founders have fulfilled their roles to satisfaction. An exit is not the only success, you could also simply transition into being a successful private company, but then there's no clear finish line. Now it is clear, no can argue the founders success, it's written in black and white and made public for all to see, they achieved an undeniably great thing.

Customers are always a product for shareholders, that doesn't suddenly change when a company is sold to other shareholders. And anyway, it could be a good thing, obviously Etsy has great experience with taking care of their customers and their partners and with running a huge business. Who says anyone was abandoned?

> Now it is clear, no can argue the founders success, it's written in black and white and made public for all to see, they achieved an undeniably great thing.

No one can argue the founders' successful profit. I know nothing about this company and have no opinion on it one way or the other, but I know companies that are borderline fraudulent (and I am aware that is a strong claim) that are going public via SPACs and the founders are getting rich despite not having a product or paying customers.

They have exactly 1.63B reasons to sell. You don't get to judge them with zero insight into their business and visions for their lives.

Also, I would openly laugh at anyone who claims that they’d personally turn down 1.63B to keep their business pure. That is an overwhelming amount of money, in the “none of your descendants needs to work” range.

I’d sell out for much, much less money.

On the contrary if I ever built a business that was worth 100 million or more I'd take far less than my share of it if it meant that I could get a clean exit and not have to stay on as an executive for a few years.

Perhaps my mentality is part of the reason why I will never build such a thing.

Apparently there were many other billion dollar acquisition bids turned down

Mark Zuckerberg Turned Down Yahoo's $1 Billion https://www.inc.com/allison-fass/peter-thiel-mark-zuckerberg...

Discord reportedly rejects Microsoft's $12 billion acquisition offer https://www.newsbytesapp.com/news/business/microsoft-12-bill...

Amazon and Alibaba have approached 5-year-old startup Wish, but the CEO seems to want more than $10 billion https://www.businessinsider.com/wish-rumored-to-reject-acqui...

Mark Zuckerberg also turned down a $15 Billion dollar offer from Microsoft.

But there's a difference between turning down a bid because you want to maintain control over your vision and because you think your company is just worth more than the offer. The point is just that if you get what you think is a fair offer, and it's a very large offer, it would be hard for most people to say no.

It's obviously not impossible for someone to turn down a billion dollar offer because they think it's not enough, or to maintain control over their company. But I think people drastically underestimate how easy it would be to not sell out and walk away. The kind of people who will look at that offer and say "no thanks" are far and few between. There is a non-trivial chance that most of us have not met anyone like that.

Also of note: Groupon turned down $6B from Google. They now have a market cap of $1.6B 11 years later.

https://www.pon.harvard.edu/daily/win-win-daily/win%C2%AD-wi...

Not all of that money will go to the founders.

Most of it won't, there's only one founder and from what I understand his share is less than what you'd expect. I imagine all the early employees did pretty well from this though.

because they suddenly have tens of millions in their and their shareholders' pocket.

Let someone else worry about growth as you cash out

This is actually a very valid question. Every situation is different — usually I’d agree with you, and I actually hesitated when describing the success as due to the exit. In this case, however, the exit is likely due to the ability for the combined entity to execute the original vision better than before, and it also allows us to put a dollar number on the value of a space / business that unsophisticated bystanders continue to dismiss as “not a real business” (even on this page!). That makes it a net win for the overall resale platform / circular commerce ecosystem, and makes future innovation in this space easier to finance.

A similar situation occurred with the acquisition of MySpace, which immediately boosted the value of all the other social networks at the time — the space had gone from being a bunch of “worthless websites,” to important next-gen media platforms that might crown the next emperor. Recruitment/funding/etc became a LOT easier after that.

The context of the parent comment is what investors think. Investors — especially VCs — like acquisitions; they get them paid out at the 10x they were looking for, within their fund's time-horizon.

I don’t dislike fashion because I’m a humble bragging genius. I dislike it because I think it’s bad for the world. It preys on and fuels women’s insecurities to sell them throwaway products made by borderline-enslaved Cambodians. A guy making $1.63 billion doesn’t change that — the mentality that “it makes money so it’s good” is precisely the sick mentality behind this whole blight upon the world. I know you are right that there is more growth in this industry, but that growth is going to make the world a worse place.

I know it's not exactly the be-all-end-all solution to the problem, but it does feel like good quality used marketplaces for fashion (like Depop) could help to counter that flow of 'throwaway products'. In addition, in the long run having a more liquid market for potential resale might encourage people to buy better, longer lasting clothes at the offset (but that might be a pipe dream on my part).

That's a pretty cynical take. Much the same could be said of any industry that relies on manufacturing and marketing. I think there's value in society at large - we are social creatures and relating to each other, mimicking each other, and other forms of communication are deeply tied to how we get along as human beings. I'm not saying fashion is itself necessarily useful at large, and it certainly has the issues you described, but it's at least a byproduct of other things that are highly useful.

Perhaps much of the same should be said of other industries.

> It preys on and fuels women’s insecurities to sell them throwaway products made by borderline-enslaved Cambodians.

It sounds like you've never used Depop or learned about it before writing this comment. Depop is the exact opposite. It's a solution to what you're framing as a problem. Depop is a way to recycle clothing rather than throwing it out and buying more - it is actually a reaction to the exact fast fashion you're complaining about.

The first R is reduce. The second is reuse. Our cultural obsession with fashion completely bypasses each of these.

Oh, but those R’s are hard and not fun.

What’s really fun is throwing all anything plastic including wrappers, #5, #7, any metal, any paper basically anything but food into the blue recycling tub that someone comes to pick up and then I can smuggly look down on people that “don’t even care about the planet”, I’m doing my part by blankly assuming all my “recycling” isn’t going into a landfill!

... I wish I would still count the number of people that think that, but it’s too many.

I try to “not buy shit”, and Im pretty sure it’s a lot harder than wishcycling.

Depop is reuse. Progress is made on the margins. Absolutist judgement of something a lot of people like does nothing to help.

I think depot would count as reuse, right?. Honestly, I'm stoked whenever we manage to make it past "recycle."

I'd be happier if they announced that recycling was fake and everything you throw in the blue bin is trash.

Perhaps, but I think it can be argued that it encourages more consumerism. The market for second-hand selling may encourage those sellers to buy more new.

Fundamentally the idea of an everchanging fashion is problematic, not just environmentally but also otherwise.

I’m not talking about Depop, I’m talking about why I hold the fashion industry in low regard.

Your whole original comment just seems pretty anachronistic in 2021. Especially as Pride month kicks off, I’d caution you against holding on to antiquated views that the fashion industry is only something for women or has to do primarily with their insecurities.

Whatever else it is, fashion to me is about both aspiration and inspiration. It is something that is creative not just for designers, but also their fans and customers. It is fundamentally about encouraging people to imagine themselves in new ways.

It is emphatically not just some one-way broadcast aimed at a certain, supposedly more impressionable, gender.

Unfortunately that's not necessarily the case. People run full on dropshipping businesses on Depop under the guise of handmade/second hand clothing. There is also widespread "thrift hauls" on Depop where 20 something rich people ransack thrift stores which are staples in low-income communities and sell on Depop for 10x. Depop doesn't do anything to counter the hypercapitalist and wasteful fashion industry - its just another component to it.

https://www.vox.com/the-goods/22396051/thrift-store-hauls-et...

This comment is pretty reactionary and maybe doesn't deserve a reply but I've seen variations on this criticism before and as someone that's worked in this space it doesn't make any sense:

> There is also widespread "thrift hauls" on Depop where 20 something rich people ransack thrift stores which are staples in low-income communities

This complaint seems to be based on a profound delusion, which is that the social mission of thrift stores is to provide cheap clothing for people who don't have much money.

The charity aspect of thrift stores, at least historically, has been the money that you give them when you buy stuff there.

So in fact the whole point of the enterprise is to have people who have stuff they don't need donate it to a worthy cause, who sell it to people with money who want it, and then they take the money that they make this way and give it to people who need money or use it to provide needed services etc.

Nobody is "ransacking" a charity by doing the exact thing the charity is hoping people will do, which is giving the charity money that can be used to further charitable activities.

> The charity aspect of thrift stores, at least historically, has been the money that you give them when you buy stuff there.

That's actually completely backwards. The public good that a thrift store provides is to make cheap, essential things accessible to people who can't afford anything else. Goodwill is a nonprofit because there is no profit in making cheap, essential things accessible to people who can't afford to anything else.

I don't know anything about Goodwill, but in the UK there are several charities that run shops and their purpose is as the parent describes - the shops generate revenue for the charity to carry out its work.

The first sentence on the wikipedia page on Charity shop [1] (and "Thrift shop" redirects to the same page) says:

> A charity shop (UK), thrift shop or thrift store (USA) or opportunity shop (others) is a retail establishment run by a charitable organization to raise money.

The Goodwill.org page About Us > Our Vision for Transformation [2] has a section "HOW LOCAL GOODWILLS DELIVER IMPACT" the third item of which starts:

> Goodwill retail operations generate revenue that supports our mission work. [...]

So, it's possible these things are dual-purpose and intended to meet both goals, or that some thrift stores have the goal of raising revenue and some have the goal of making recycled items available cheaply. But certainly parent's point is not backward - at least many thrift stores explicitly operate in order to generate revenue as a form of funding for charitable ventures. People with money buying things from charity shops helps the charities. It's what they want.

[1] https://en.wikipedia.org/wiki/Charity_shop [2] https://www.goodwill.org/about-us/our-vision-for-transformat...

If I could edit I would say "this overlooks the impact that thrift stores have on their communities" or something similar.

The difference between Thrift store prices and new garments in many cases is less than it used to be. Look at uncool stores, JC Penny, Walmart, and a few others, and you can get clothing for very little.

>throwaway products made by borderline-enslaved Cambodians

Well good thing Depop helps consumers avoid buying brand new clothing items and encourages giving life to old clothes.

>I don’t dislike fashion because I’m a humble bragging genius. I dislike it because I think it’s bad for the world.

All of fashion is bad for the world? Is that really your take?

I guess at a high level, nearly everything humanity does is bad for the world. If that's your starting point then it makes sense?

Yes, that is really my take.

So, nudity is the answers. Also ban tattoos and hair styles while you're at it. And all self-expression, since that's also subject to the whims of fashion.

Thank you for enlightening us, Mr. Mao.

Fashion is self-expression and your own personal connection to culture. I don’t think nerds on HN generally grok those concepts but many other people in the world do. It’s very important to lots of people and it’s a lot of fun once you know what you’re doing.

The fashion world has abundant problems but it’s still an important industry. Preying on insecurities and using cheap labor is sort of a way of looking at all consumerism though.

> it’s a lot of fun once you know what you’re doing

It's also pretty useful if you have an open mind and no idea what you're doing.

I don't really "do" fashion but I'm grateful for my cerulean sweater!

https://youtu.be/vL-KQij0I8I

Fine with me. If a bunch of smart people are going to lock themselves out of a multi-billion industry because they are too “enlightened” to bother, awesome. Less competition.

Don’t assume that because I don’t like it, I don’t understand it. I do understand the venal emotions of mankind. That doesn’t mean I respect the people who stoke and exploit those emotions for profit. A lot of consumerism is ecologically destructive but only a small amount of it depends on actively harming your customer’s mental well-being. Fashion, Facebook, sensationalist media, etc. are all industries that depend on making people feel worse.

> I do understand the venal emotions of mankind.

Thank you, this is now my new catchphrase!

Frankly, you don't understand fashion. Fashion is not a new industry, nor is it parasitic. It's one of the oldest forms of self-expression and it makes lots of people feel better, not worse. Fitting in is always going to be stressful, but it's stressful because it's so important for social creatures like us. Fashion is simply a tool that helps people fit in. If you figured out a way to fit in that doesn't involve fashion, then power to you, but that doesn't invalidate thousands of years of people enjoying clothes.

I want to know more about this, but I have no clue. No clue if I'm fashionable at all. It's more like "Yes" and "No"

I usually recommend guys start with r/malefashionadvice to learn how to fit in, and then later on you can learn how to stand out. (edit MFA is US-centric but some of the concepts are still universal) It’s hard to fashionably stand out without knowing the fundamentals of constructing a basic outfit and knowing a little bit of fashion heritage, which you’ll learn from that subreddit. Once you’ve been there for a few months and learned all the standard MFA outfits, I’d leave and go in your own direction. People there tend to be a bit sanctimonious and rigid. Instagram and Pinterest are good places to find further inspiration once you have a bit of taste to filter out the garbage.

The fun part starts when you graduate from MFA and start to explore your own style. It’s rewarding to put together a visual identity that feels deeply personal, and then get a complement from another cool-looking stranger when you’re out and about. It feels like that person really likes YOU, and they probably do — and now you have the perfect ice-breaker. It’s just like working out; it’s an investment but there’s cumulative benefits in multiple aspects of your life.

Peak HackerNews

If your main “self-expression” statement is that you want to look like others, is that really self-expression, or were you just brainwashed?

If your interpretation of fashion is "looking like others" then it means that your last encounter with fashion was when you were a high school teenager.

I think you're mixing up self-expression and being completely unique. Self-expression is about fitting in as much as standing out. It's about figuring out who you are, and how you fit into society. Fashion is about telling the world "this is who I am". It's a really good way to connect with like-minded people.

If you wear a business suit, you'll find company with conservative business people. If you wear all black, heavy boots, and band t-shirts you'll find company with people who are into the local music scene. If you wear Patagonia vests or startup hoodies you'll find company with people who want to code into the evening.

This statement is really kind of funny, because its so stylized, so absolutely stereotypical that there was no way for you to possibly come to it creatively and originally.

Is some one buying momjeans on depop brainwashed, or is it you? If you aren't the one who is brainwashed why is your reply so ritualistic?

People will often say "I don't care about fashion", then I point out that by wearing a dark monochrome tshirt, "silicon valley" hoodie, zip-up vest etc. you are showing that you are most definitely up to date on fashion trends.

> I don’t dislike fashion because I’m a humble bragging genius. I dislike it because I think it’s bad for the world.

We could play that game for days, about most industries that feature prominently on HN. This looks like just the sort of narrow focus the original poster was talking about. Why are fashion products worse than new smartphones coming out every year? Because we personally like gadgets more? And if we were talking about a used tech toy marketplace, comments about how new manufacturing was bad would be similarly out of left field, since here's an example of reuse.

This article was about fashion, so it seems relevant. Other discussions about companies harmful practices often do sound off in the threads about those companies or fields.

I dont think anyone said one was worse than the other until you did - we can actually be against more than one thing at a time and maintain various levels of concerns across more than one thing at a time without constantly bringing up a list of all the bad things in the universe.

> We could play that game for days, about most industries that feature prominently on HN.

Do you have a moment to discuss my new crypto coin? It is specifically good at taking dinosaurs and making them money launder for drug dealers, murderers, and slavers.

According to my reading, HN is full of complaints about new phones (and everything else, e.g. washing machines) being built with “planned obsolescence” as a goal, and praise for Apple for being by far the best in supporting old devices (but of course they could still improve!)

FWIW the iPhone 5s from Fall 2013 is still receiving regular security updates.

https://support.apple.com/en-us/HT212341

Planned obsolescence goes beyond whether phone software gets updated or not. It covers changing designs so that you can tell one generation from another, so that there is social pressure to upgrade despite the phone working fine.

All human activity except agriculture and medicine is a waste of time of you want to be strict about it

oh ... wait till you hear about the car industry.

I like fashion because of the creativity

I also like that I know where to find people that have the bodies that less attractive women say are not real

Just don't say anything at the tech company, or nod and agree so that your coding academy graduates or state mandated board member doesnt axe your entire division, and then go get greeted by your bubbly atmosphere models after work

Come on now, mens fashion is also a multi-billion industry

I think you have bigger fish to fry than a niche reseller app. www.walmart.com

I like to compare greed with steam and capitalism with a steam engine. It's noisy and inefficient, but that's the only tech we have right now.

Nothing against the business, but if one were to start a lifestyle business, I can't think of a worse one than a marketplace, where you have to deal with refunds, inventory, legal issues, tons of advertising, upfront losses, etc. You're probably better off actually selling your stuff in these marketplaces, if you wanted a lifestyle business.

When I think of lifestyle businesses, I think of Pinboard, or Appointment Reminder, or a Depop/Poshmark/Etsy storefront.

I'd never visited the site but it looks very nicely executed, especially at creating a consistent vibe out of user-uploaded photos, which isn't easy.

A neat thing about businesses like this is that it takes a skillset that a lot of underemployed people have (cool hunting in thrift stores), and gives them a path to making part of their living out of it aside from the ancillary benefits of that come with being fashionable and cool. It also provides access to wider markets and price discovery for vintage shops in the same way that abehbooks did for used bookstores a decade or two ago, or eBay did for junk sellers at flea markets.

The inevitable downside is that it further compresses globo youth culture and makes it harder to develop a scene, but that horse left the gate a long time ago.

If they can just get the search to work properly I’d use it a lot more!

> “lifestyle business” or “not likely to achieve a high ROI” to create what is now a billion-dollar exit.

Why would you believe this? Fad businesses chasing the tweens and 20-somethings is ABSOLUTELY the kind of business that VCs salivate over.

And fashion rises and falls in cycles. Have we forgotten fashion darlings like ModCloth?

The key to the fashion business is knowing when to cash out.

My partner is a top seller on Depop. We send and receive packages pretty much every day, it’s been great for them during the pandemic.

Depop has done a great job fostering a more human experience than other platforms. That’s definitely a huge factor in their success.

Buying and selling is pretty involved. Haggling is super common. If you’re selling many items, people will message you and ask for bundle deals. If you’re a regular, sometimes people will just throw you a discount. If you just buy something silently, you’ll often get a short thank-you message.

There’s a culture around the packaging, too. People tend to put candies, stickers, hand-written thank-you notes, extra things the seller doesn’t need anymore. It’s fun to open packages coming in, and it’s fun to pack them out with little surprises.

My partner has made a lot of friends that way, which has led to trading of talents and services. Sometimes it’s just people helping people, sometimes it’s commissions, sometimes it’s bartering, but all originating from the platform.

I definitely see why Etsy’s interested.

Just wondering, is it profitable? I believe the Depop fee is 10% plus payment processing fees, which to me doesn’t sound like a great deal, but then again I’m not really familiar with that whole market.

My sister runs a succesful shop on Depop, she's the starving artist type, and the income from her Depop puts her suddenly at a decent median income. I don't know how sustainable it is, who knows for how long her artistic taste aligns with Depop's target market, but it does seem like a great way to run a business.

It is very surprising to me that it's as low as 10%. I bet that even if it were 30% or even 40% it would still be profitable. The way she operates is she buys lots of second hand clothing from Japan, for lets say $5 and then from that lot she sells a pair of jeans for $50. So her profit is $40 on the lot. Maybe she makes 15 sales per week, and boom there's a decent wage.

Numbers are all extrapolated from when I talked to her about her business one weekend a couple months ago. I have no idea how much she actually sells or makes at the moment.

Maybe also interesting to note that this is a scale up from what she already did locally. She's been trading second hand clothing for years now. The Depop thing is new and it transformed her business from being a side gig to a primary source of income.

I've been listening to Galdwell's audiobook Outliers and he talks about the NYC garment industry in the late 19th and early 20th century. There's a lot of parallels with today. You might find it interesting.

Anecdotally, this platform gives liquidity to your otherwise unsellable clothes, and that is the big appeal.

If you have a dress you’ll no longer wear, you have a few online platforms to sell it on, but they’re not known for fashionable clothing. Nobody will be looking for your clothes on there organically. It drives the price of your clothes down, if you’re even able to sell them at all.

A lot of people use this to recycle interesting fashion and keep their closets and outfits interesting at a really low cost, as my partner does.

You do have flippers of course, it’s common enough that they call Depop-flipped items “repops”. I suspect this can be profitable, but you need to source your items at a great discount.

Definitely not if you account for time.

Sellers are making subminimum wage profits per hour.

On the one hand, a medical resident also makes very close to minimum wage.

I have a family member who just left her banking job to expand more into Depop and yesterday she mentioned she hit the milestone of making more than her bank job now.

The market for used things is not very liquid, selling online is often the most profitable choice. Selling locally directly to consumers mostly means not finding any buyers or greatly reducing the price. Reselling used clothing to a brick and mortar store, or to be consigned will vary. It often takes 80-90% for children's clothing, 50-70% for most women's clothing, as low as 20% for very valuable items like designer purses. There are other online markets but most of them charge more in fees, and really only Ebay has as much traffic from buyers

Isn't that also how Etsy was, before it became a drop shipping marketplace?

Pretty much. I remember someone showing it to me in 2010 and I was floored at all the cool vendors on it. Expect Depop to be gutted soon like every other startup purchase.

But then again, those were probably the founder's plans.

I once bought a bottle of expensive fountain pen ink for my sister as a present; the thing that struck me most about it was that they included a hand-written thank you note in the packaging. It was a family business, and I remember it, years later, because it was such a pleasant surprise, and an unexpected one from all of the other commercial encounters I have. It taught me the value of the personal touch and attention to detail for customers.

And as a note to any big companies thinking of doing this, it has to be personal. I've gotten tons of cards and brochures in packages from big companies that I instantly throw away because it's usually just corporate jargon about how much thought was put into making this product "just for me".

I mean now Etsy is interested I'm sure it won't take long to become another wasteland of shit-tier mass produced products from Chinese sellers.

>Depop has done a great job fostering a more human experience than other platforms.

You paint a pretty picture; the camaraderie of buying, selling, haggling in an online cobbled internet town square, make for an idyllic setting. The tug-and-pull of reuse/recycle, vintage vs fast fashion are noble principles.

However, there is a murky side, which is infused with extreme expectations, toxic and churlish behaviour e.g. Amazon Prime type service, petty haggling over a few pennies, sellers abusing their privileges, limited understanding of fees and/or how PayPal works, unnecessary spats and an appallingly high level of entitlement etc.

Nevertheless, there is synergy, but have doubts about long-term prospects ─ Depop might just become another case study in acquihire or perhaps just a blot, as there is no shortage of other contenders nipping at their heels e.g. Vinted.

https://www.instagram.com/depopdrama/

The drama is pretty ridiculous sometimes, it’s true :)

This aspect isn’t unique to Depop however. Other buying and selling platforms that allow negotiation are full of people trying to assert their nonsense onto you.

It feels like it’s just part of organic haggling culture. And for some people, like my partner, I think wading through the nonsense and having a handle on it can be part of the fun.

Likewise though, I’m interested in seeing how the acquihire goes.

Congratulations to the team, I spent a few years at depop, great to see them getting the recognition.

For those interested, it is a scala shop, all terraform and AWS on the backend

Warms my heart to hear about more Scala in the wild.

We’re they leveraging Akka too by chance?

I think it's mostly Play Framework on top of RDS in terms of Scala usage.

Of course, Play is on top of Akka

You can use Play and not care about Akka that much. I think the original question was about using Akka directly.

Bits and pieces of Akka in a few places, but not commonly

and of course... good old Django :P

of course, old faithful will be around for a while yet..

Let's go for a beer soon!

that will be nice! :)

Not for long. A few services are moving away from scala to kotlin (ktor), probably more to follow.

Reading the headline "<Business I've never heard of> selling for $<N>bn" is become an increasingly common occurrence for me

I suppose you don't hear often about all the market/advertising companies buying each other. Even though I work in this field, I am almost always clueless about who are these companies.

Advertising companies have a natural size limit since they generally can't work for competing companies. Agencies reach about $500M in revenue and then get sold off to a holding company. It's almost inevitable there are a whole bunch of deals.

I'm always surprised in number of these 1B+ businesses... Like is there really this many of them, or is there something weird going on...

My guess is that it's driven by multiple inflation.

Prior to August 2018, there were no trillion dollar companies, now there are at least 5 (MSFT, AMZN, AAPL, Aramco, Google) and more on the way.

> Prior to August 2018, there were no trillion dollar companies, now there are at least 5 (MSFT, AMZN, AAPL, Aramco, Google)

This observation seems more likely to be driven by Aramco not being a public company before 2018 than by Aramco not existing before 2018.

Just because it's a little harder to see something doesn't mean it isn't there.

Sure there’s multiple expansion, but also significant earnings growth...

They fly under the radar. They keep their heads down and do their job without trying to attract attention in order to avoid unwanted competition. There are myriads of such companies out there we've never heard of.

Depop is very much the opposite of flying under the radar. They are a key player in fashion and love nothing but flashy promotions, they’d love to be associated to any big brand. They are not as big as Farfetch (disclaimer: where I worked) but both companies are pillars of fashion-tech scene in London.

Their marketing and social media presence is as large as they can get it (I know their former Head of Social media and VP Product). Being successful there is a first step to becoming an influencer. As a second-hand market, they’ve been carried by the environmental trend lately, deservingly so. Their audience is younger, more female and fashion-forward and in that very seeked-after demographic, they have incredible numbers. There are American companies, like Vestiaire Collective, that offer a similar service but Depop is making strides around the world.

There might not be a lot of overlap with your interest, or those of many people in Hacker News — and that’s fine. But, to fin equivalents, saying that TikTok or Tampax are "under the radar" brands says more about your curiosity than it says about a product used by half of the population.

They're not a "key player in fashion". A key player in fashion is Prada or D&G. They're a niche company dealing with second hand streetware items.

How on earth does Tik Tok or Tampax relate with Depop?

P.S. As a general rule of thumb we try to avoid personal remarks in here when replying to a person. Just to keep the place a bit more civilized.

Depop really isn't a niche company. It's effectively instagram but the clothes are for sale. Companies relate to the consumers the same way they do with instagram influencers, product placement.

I suppose it's not that much really. If you stick a P/E multiple of 20x on it then it's only annual earnings of $80M.

You only get that multiple if you're publicly listed. Usually for M&A the price is discounted from that, but this also varies widely by industry. Never do a hardware startup, for instance :)

What is clothing but low tech wearables

E-commerce

I've always felt one of the fallacies of the startup culture that we surround ourselves in is that winning involves "taking over the world".

There are so many "niche" businesses out there - that will be enough to bring in millions in revenue - simply because there is such a variety in what people want and need. And we'll never hear of them unless our interests happen to coincide with that particular niche.

Case in point - I've just started working for a company that is an upstart small player in the area of document management for construction companies. You'd think document management was a solved problem and there wouldn't be room for specialists in that area - but no, there are several multi-million dollar businesses that do nothing but. And there's still room for small companies like ours to grow into.

Interesting that you used the term "document management" as opposed to "content management." I cut my teeth as a "document management" consultant in the early 90s, when it was really just documents. I thought the "content management" term took over.

For this niche it is specifically document management - CAD drawings, PDFs and MS Office files.

Yes something very weird is going on.

https://fred.stlouisfed.org/series/M1SL

It's a byproduct of all the VC funny money being thrown around.

I mean this in a completely good-natured way, but after looking at their site I’m not surprised that someone who would write “<Business I’ve never heard of> selling for $<N>bn” has never heard of them. You don’t strike me as their target audience.

That said, neither am I. Looks like you can’t even view any merchandise on the website, it’s basically an app-only experience it seems. That’s a huge turn-off for me.

Yes you can, just scroll down

After clicking on "Vintage t-shirts", I got no products available.

After scrolling a bit more down, I've noticed I can click on what I'm assuming is individual sellers, but that returns 500 internal server error.

And this thing is being sold for a billion dollars.

Ok boomer. Nobody uses websites anymore. For the proper shopping experience you must install the app. Your precise browsing history and phone location will be used to tailor a bespoke peer-to-peer shopping experience. Don't like a shopping app running 24/7 in your pocket? You just don't get modern fashion.

But I was born in 2002 and I still don't get this crap. It is like people are begging to be psychologically controlled for max financial extraction...

Pretty sure they were being sarcastic.

>> people are begging to be psychologically controlled for max financial extraction

"Shut up and take my money!" Futurama s06e03 - Attack of the Killer App (2010)

"This thing" is a hugely popular marketplace for second hand clothing. Probably the first platform to finally crack second hand clothing online, lots of billion dollars being spent on clothes.

The disdain some people have for what is not their niche is crazy. Not everything needs to be a SAAS. It's pretty clear this is meant to be used as an app and it looks like you did your best to ignore it.

You do have to admire them for being as popular as they are, and not actually being good.

Their app can't even properly show me clothes based on my preferences: https://twitter.com/dmitriid/status/1400084936372199429

It only goes to show how horrendously bad the original market was.

> It's pretty clear this is meant to be used as an app and it looks like you did your best to ignore it.

Not clear at all. I looked up the company, opened the website, and there are some "get the app" buttons, but the website does not indicate that the product is an app-first experience at all.

The submitted article even mentions it as a "shopping site", not an app. And looking at play store reviews, it doesn't look like the app is any better. It's filled with various technical issues and 1 or 2 star reviews.

So excuse me for having this crazy assumption that if something is being sold for over a billion dollars, it should at least somewhat work.

If I were Etsy, I would probably buy it for the community and marketing talent, fire every single dev and start from scratch.

I did, I didn't see anything that looks like the start of an ecommerce sales funnel. Maybe I missed it, I was just expecting something obvious. I expected the main menu (on mobile) to have some kind of inventory taxonomy. I'm well aware I'm not the target audience and it shows.

Depop is hugely popular. Every 20s girl knows about Depop. HN is just not the demographic.

4m buyers and 2m sellers according to the FT.

The website works fine for me - searching e.g. Céline shows 126 products.

Very HN way of calling someone a fellow nerd, I love it.

It's actually one of the reasons I left the company. On paper I was hired (back in 2015) to build the website, but spent most of my tenure building internal tools. When I finally did get to build it, thankfully I had another web developer working with me by then, but it was also clear there was no interest from the rest of the business in making the website anything more than a lead generator for app downloads.

This was probably a good business decision given their key demographic, but it didn't make me feel good about what my role was, especially as (according to the soon-to-be-CTO) I was one of their stronger engineers. It felt weird to have expertise and constantly feel side-lined. There were definitely some challenging years in the middle, but they seem to have turned it around.

Try signing up/signing in on web and you'll get a whole new experience.

Anonymous browsing/guest checkout might be an avenue that we take another look at in the future; but yes - historically we have been focussed on our mobile apps as first-class citizens.

Way back when I was a computer systems product manager, I was constantly struck by the random customers that would come through the executive briefing center who were some random boring business (making milk bottles or whatever) and it would turn out they had 75% of the US market or something like that. (This was before really widespread globalization.)

I would be super interested in ways to visualize or learn of these 'background realities'.

To think that one day Etsy was one of those businesses, and now they have $1.63B to spend on the new thing

Back in 2016, Depop's founder, Simon Beckerman, was on an episode of BBC's The Bottom Line podcast about "The Youth Market" [1]. He explained his motivation behind starting Depop (app-driven alternative to eBay with a social element) and I thought it was quite insightful.

[1] https://www.bbc.co.uk/sounds/play/b080xk99

I've heard he's now building an app with similar philosophy about food.

https://www.delli.market/

At the risk of misusing Gen Z slang, Etsy is "Cheugy" and depop is "no cap fire". Depop has the cache of being cool enough that celebrities (Doja Cat and Princess Nokia come to mind) whereas Etsy is more "mom crafts", with that being said I'm a big Etsy shopper. This feels a lot like the aqquistion of Instagram by Facebook in terms of buying a company for not just utility but social capital.

Today I learned about the word Cheugy, and wish I hadn't.

The wikipedia page for it reads like satire: https://en.wikipedia.org/wiki/Cheugy

> While it has been compared to "being basic",[3] some sources have suggested that it is "not quite 'basic'."

What do you mean?! What are you trying to say to me!? Use real words damnit! We have so many!

The point of using that lingo is not to try to communicate with you, but amongst their own tribe members. It’s probably been happening since language has been around, and it happens in all sorts of groupings (age/business/profession/location/race/education/etc).

At a glance it seems to be the difference between mainstream tastes and mainstream deviating tastes.

I was under the impression that it all eventually turns into AliExpress? I do not see how one can trust these “individual” sellers on Etsy or Depop or whatever to do quality control. If they do, and the reputation of the “market” is good, then there will exist arbitrage opportunity for other sellers to resell AliExpress stuff.

A few years ago, Etsy claimed that they were on a big mission to remove resellers and only allow individual, bespoke sellers.

I haven't seen a whole lot of evidence that they have, or have been successful.

I've heard it akin to Etsy is where your aunt buys her "Live Laugh Love" signs and Depop is for kids to shop for cool college outfits.

I do a lot of thrifting myself and have been comparative shopping on Ebay, Depop and Poshmark for the best deals. Sometimes the same products are on all three!

I'll translate "no cap fire" for everyone:

- "no cap" = not lying

- "fire" = cool

- "no cap fire" = definitely cool

This is a great move from Etsy. I believe the future of fashion is high quality items being bought, resold, or rented.

I don't think this because it's better for the environment (though it is), it's because I think young consumers genuinely want to consume fashion this way. They want to be seen in higher quality clothing, and the Depop model of buy and sell is the way to attain that.

>I believe the future of fashion is high quality items being bought, resold, or rented.

What kind of fabric that can withstand the stress of wearing, washing, drying and still be comfortable to wear and retain the look ?

Sure rugged outdoors stuff or comfort clothes that you don't care about stretching out and discolouring. But stuff like sweaters, jeans, etc. doesn't seem to matter how much money I pay - I get a more comfy fabric and better production quality - but durability wise it's nowhere near close to the jump in price.

What do you think the vintage fashion market is?

Vintage clothing is more expensive than the fast fashion stuff you can buy for 2 reasons. The clothes are more durable (they've lasted at least 2-3 decades) and they are less cookie cutter.

Yes, and they are unique one-off items that managed to survive out of millions items from the same eras/decades that didn't.

That's why they are expensive.

>What kind of fabric that can withstand the stress of wearing, washing, drying and still be comfortable to wear and retain the look ?

Whool, if you know how to care for it. Suits can easily last decades.

Everything made out of cotton, including bespoke shirts, is by default more or less a consummable and doesn't really enter the range of long term/valuable fashion.

I think suits last decades if you wear them occasionally - but I doubt you'll get daily use out of pants without wearing them out.

And having to care for things (special washing etc.) isn't really practical for most things which is why I doubt we will get this shift in trends.

Maybe if we get some new revolutionary fabrics.

I wonder if there was an innovation where you'd get a comfy and super durable fabric but it costs 10x of regular clothes - would people go for it.

There's plenty of fabric innovation going on. Not just in techwear (where you get your high end outdoors stuff), but also in more traditional fashion. Off the top of my head I've seen the Techmerino stuff from Zegna (which fits the bill of your super fabric, including the cost), the nylon/spandex hybrid Seagale uses (don't know who makes that), the technical wool/silk/polyurethane blends from VBC (they call that line Earth, Wind and Fire).

Thank you for this - I will look into it.

I’d be interested in reading about how Depop did what dozens of other startups have tried to do: build a giant business around the used clothes market.

I found it.

“But the real secret to Depop’s success is that it allows users to amass two of the most valuable modern currencies: money and clout. Becoming a top seller on Depop is a springboard to fame on YouTube or Instagram. It also provides built-in monetization for a future career as an influencer.”

I don’t think Depop did anything special per-se. It’s a combination of luck and the right investors bankrolling it for ages.

It is a very marketing-heavy operation, as the platform itself doesn’t offer that great of a deal to sellers - they charge a 10% commission plus payment processing fees (PayPal takes 2%, though now I believe there’s an option to use a different processor), so high-volume sellers are unlikely to use it. I wouldn’t be surprised if up until this day they were spending more on marketing that they would’ve made back from most customers.

The business itself is quite low-margin (support & fraud/scams cuts into that), has decent competition (Mercari, StockX) and can be trivially replicated by the likes of Facebook (Depop is basically an Instagram but where you can buy & sell - something FB can trivially replicate if they wanted to).

It makes sense for Etsy to buy it for access to the userbase and to integrate it into their existing business, but as a stand-alone business it's not that great IMO because of the aforementioned points.

"a combination of luck and the right investors"

I don't think that would be fair and that it is 100% likely there was a great deal of deliberate strategy involved as well.

My point is that I believe the strategy was a very risky bet (way too risky in my opinion, but then again I'm not a startup CEO for a reason).

This is a very marketing-heavy operation that I don't think could stand on its own and be sustainable, and so the only possible outcome is to stay afloat long enough (by reinvesting a significant chunk of revenue into more marketing) to get gobbled up by a bigger fish.

They had the right investors that believed in it and bankrolled it for long enough and it paid off, but it's ultimately still a stroke of luck IMO.

I doubt FB could replicate this. Fb itself is a non-starter the people who use this app haven't been on Fb in years. Okay, so Instagram. If they could, they would’ve.

I think there are problems with making Instagram seem tacky by clobbering on a marketplace. It would make it look cheap and shilly. Right now it’s the most rarified space to share pictures of your awesome lifestyle. I think you can either have that very cool, chic vibe or the amazon marketplace vibe.

I think that despite their enormous resources, there are places that brands can’t go.

Instagram already has marketplace features, and personally it lost its rarified space vibes to me a long time ago.

Depop isn't alone in this, Vinted[1] has a current valuation of $4.5B and is hugely popular in Belgium, Netherlands and France (maybe more places, but those i can definitely say).

In both platforms there is influencer-heavy marketing. Many fashion influencers(i really dislike this term, but it is the nomenclature) sell clothes that they wore very little in Instagram advertisements. This is a great business model for them, people follow them more tightly because they are actually able to buy for (mostly) affordable prices some of the clothes they see in pictures and they also get some additional under-the-radar cash.

[1] : https://www.vinted.com/

In Scandinavia I think Tise is similar. For purchasing used clothing and stuff, but the listing is more akin to Instagram than on a normal listing site. You follow people with a style you like and buy their stuff, and then sell it on.

https://tise.com/

It's interesting that they have a much higher valuation (and from some cursory research, moderately more users) than Depop, despite (AFAIK) being completely obscure in the US/UK.

They also doubled-down on it. They flirted with branching out into other markets and demographics but it didn't really stick.

There was a bit of luck in getting their initial traction (they were definitely not prepared for the growth spurt and spent years getting to the point that the backend wasn't just falling over constantly), but they executed really well on capturing their core market.

Depop is more similar to instagram than a resale site. It has influencers and a "for you" page.

Don't be like Grailed is a good start. Can't believe how badly that site has managed to snatch defeat from the jaws of victory.

Congrats! Amazing synergy. Fashion resale marketplace expected to be worth a jaw-dropping $51B by 2023.

https://www.businessoffashion.com/articles/retail/etsy-buys-...

Etsy is a GCP case study in public cloud infra migration, moving from 2000+ on-prem bare metal servers

Etsy: Migrating to Cloud (Cloud Next '19)

https://www.youtube.com/watch?v=_Gdm5Jcoajg

I don't follow it that closely because I'm not buying a lot of second hand or whatever but my impression of depop the last say 5 years was that it was used alot in UK but no one in North America

Ah the company that requires you to sign a NDA before you can enter their office, and think it still hasn't been voided by them. Not a fan

Good timing because it seems like Facebook marketplace now supporting shipping (and they syndicate your store through IG, etc) is set to disrupt this space, based on some people I know that are selling a ton more on FB lately and complaining about not selling anything on Depop. Will be interesting to watch how this plays out.

I'm wondering who leaks these deals and the valuations early? Doesn't it ruin negotiations

I knew about Depop since they were a tiny startup and I never thought they would grow so much!

Well done!

And that's a humbling reminder I'm crap at picking startup unicorns and the equities I'm negotiating as employment are probably worthless.

> the equities I'm negotiating as employment are probably worthless.

In this phase, it is all about spread. VCs and the likes invest in, say, 100 startups, because they know only one needs to success so they can write off the other 99.

You, as employee, however, cannot work at 100 startups and get paid in equity. So statistically, the equity you receive from the company you work now, is quite probably worthless.

At least, that is how I treat it: nice addition, interesting to keep me and my co-workers focused on revenue, but statistically worthless in the long run.

I'm let down on every article about Etsy lately. They used to be an engineering powerhouse during the StatsD days. Are they doing anything notable in OSS or engineering today?

Congrats to the team!!! Used to sit across them in CW in London... way to go

looks like an expensive online goodwill

Younger hipsters. :)

I guess it makes sense considering Etsy is geared to customers like hippies, yuppies, yippies, punk bartenders, tattoo artists, bicycle mechanics, and hipsters roughly 27-50.

Expand the demos: build vs. buy. If you have the cash, buying is faster. If you don't, sweat equity build-out into adjacent categories and demos but it's slower.

Edit: Oooh, the hipsters don't like being called "hipsters." Trigg-ered. :DD That's okay, I'm half-hipster and half-yippie.

I can't downvote yet, but your comment doesn't add much to the discussion and is very hard to understand. And your edit is likely to attract even more downvotes since it just completely detracts from anything you were trying to get across.

Huh? Businesses need to expand by demographics or by categories. This is what Amazon did. They started with books and then continually inched their way into new categories, new businesses, and new demographics. Zero to 1, then 1 to N. That's how to grow a platform, or at least the holding company that comprises a collection of platforms. Keeping brands separate also reduce objections: Disney and (what was) Touchstone, Toyota and Lexus, Technics and Panasonic, Trader Joe's and Aldi.

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