The e-commerce website Etsy has announced that it is buying the second-hand clothing app Depop for $1.625 billion. The deal is expected to close in the third quarter of this year and Depop will continue to operate as a stand-alone marketplace run by its team headquartered in London.
Commenting on the acquisition, Josh Silverman, CEO of Etsy, said:
“We are simply thrilled to be adding Depop—what we believe to be the resale home for Gen Z consumers—to the Etsy family. Depop is a vibrant, two-sided marketplace with a passionate community, a highly-differentiated offering of unique items, and we believe significant potential to further scale.”
With the deal, Etsy will be picking up Depop and its community of 30 million registered users across 150 countries. It said that the second-hand market is expected to grow at 39% CAGR from 2019-2024 in the United States alone and will eventually be bigger than fast fashion on the global level.
According to Etsy’s statement, 90% of Depop’s exiting users are below the age of 26, showing that young people are coming to second-hand fashion before other demographics. The second-hand fashion sector’s antithesis, fast fashion, has been severely criticised over the years as being bad for the planet and employing people on poverty wages. With young people set to experience the worst effects of climate change, it’s easy to see why they’re the biggest demographic on Depop.