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The Fall of the House of Etsy
The beloved marketplace set out to disrupt the monotony of home goods gifting. Now its platform no longer feels differentiated. What happened?
On November 23, 2021 – in the midst of a pandemic that saw the re-emergence of the kind of craft-driven “cottage industry” the company had aggregated onto its platform – share prices sat at an all-time high of $296.91 and the biggest concern for many investors was that the employee perks were too good. “There are a lot of aspirational sellers who come to Etsy and realize that after a few months, they’re losing money selling a bunch of products for cheaper than they need to,” Matt Chancey, a private equity consultant, tells SPY. 1 This pattern of scale > internal ad products > clusterfuckery > user exodus is generally referred to as “Enshittification,” a very fun term coined by Cory Doctorow in 2022 to explain why, broadly speaking, everything on the internet now seems way worse.
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