San Jose, California — eBay has announced its intention to acquire Depop, a prominent resale marketplace for secondhand fashion, from Etsy for approximately $1.2 billion in cash. This move signifies eBay’s strategy to attract younger consumers, particularly Gen Z shoppers who are increasingly seeking sustainable and affordable fashion choices.
Founded in 2011 and based in London, Depop has cultivated a vibrant community aimed at younger audiences. Recent trends show a heightened demand for unique, pre-owned items that provide an eco-friendly alternative to fast fashion. The marketplace currently boasts around 7 million active buyers, nearly 90% of whom are under the age of 34, alongside more than 3 million active sellers.
eBay’s CEO, Jamie Ianonne, expressed confidence that integrating Depop into its business model will allow for accelerated growth, leveraging eBay’s operational strengths and broad market reach. Although both companies have confirmed that Depop will retain its brand identity and culture post-acquisition, the integration is expected to enhance Depop’s market potential.
This transaction marks a significant shift for Etsy, which acquired Depop for $1.6 billion in 2021 as part of a strategy to create a diverse portfolio of online marketplaces. However, after reassessing its business model, Etsy is pivoting back to focus on its core platform, with CEO Kruti Patel Goyal emphasizing the need to concentrate on opportunities that provide maximum value to Etsy’s community of buyers and sellers.
eBay plans to finance the acquisition entirely in cash. Etsy intends to utilize the proceeds from this sale for general corporate needs. Both companies have reported that their boards unanimously approved the deal, which is expected to finalize in the second quarter of this year.
The announcement had immediate effects on stock prices, with eBay shares rising by more than 7% and Etsy’s shares climbing close to 15% in after-hours trading. Analysts view this acquisition as an important step for eBay, highlighting the growing significance of secondhand markets as consumers increasingly value sustainability in their purchasing choices.
As traditional retail faces challenges, the online resale space continues to flourish, indicating a fundamental shift in consumer habits. The successful integration of Depop could position eBay favorably within this evolving landscape, appealing to a demographic that prioritizes both style and sustainability.