Activist Elliott Investment takes stake and board seat at Etsy

Category: Etsy News
Activist Elliott Investment takes stake and board seat at Etsy

Etsy have announced that its Board of Directors has appointed Marc Steinberg, Partner at Elliott Investment Management to the company’s Board, effective this coming Monday, the 5th of February. He will also join the Board’s Audit Committee.

This follows Elliott Investment building up a stake of 13% in Etsy, something that on the face of things is pretty concerning as they’re know as an activist investor – many will still remember when they turned their sights on eBay, resulting in the eventual spin off of PayPal to create ‘value’ for investors. The problem is that investor value is rarely entirely aligned with the interests of sellers (or buyers) on the platform, although a return on their investment is after all what investors are there for.

Josh Silverman, CEO at Etsy welcomed Mark to the board, although we’ve no way of knowing if this was through gritted teeth as he prepares for some coerced changes to how the business is run. We know Etsy flourished throughout the pandemic years but since then growth has flatlined leading to layoffs, along with many others in the industry.

Marc brings unique and valuable experience as an investor and board member in the technology, digital media, and e-commerce industries. We’ve gotten to know Marc, and appreciate his passion for Etsy’s mission and excitement about the future growth opportunities for all of our stakeholders

– Josh Silverman, Chief Executive Officer, Etsy

Marc’s comment in the press release announcing his appointment talks about value creation and one can’t help wondering if this could include spinning off parts of the business like Depop and Reverb which they acquired for $1.625bn and $275m respectively.

Etsy has a highly differentiated position in the e-commerce landscape and a uniquely attractive business model, supported by a distinctive and engaged community. We became a sizable investor in Etsy and I am joining its board because I believe there is an opportunity for significant value creation. I am looking forward to working with the Board and supporting Josh and the team as they execute on initiatives to improve the customer experience, accelerate top- and bottom-line growth, and drive long-term value.

– Marc Steinberg, Partner, Elliott Investment Management

Etsy’s Chairman, like the CEO, was equally welcoming of the incoming expertise.

Marc’s appointment reflects our ongoing commitment to enhance the perspectives and expertise on the Etsy Board. We look forward to benefiting from his voice in the boardroom as a seasoned and experienced investor as we continue our journey of creating a leading global ecommerce platform

– Fred Wilson, Chairman of the Board, Etsy

For those who rely on Etsy for their livelihood, only time will tell if activist investor turning their sights to Etsy works in their favour or not. If Etsy’s core business starts to grow resulting in more sales for sellers and makers without rising fees we’ll chalk this one up as a win. But if the company makes it more difficult to trade, either through fees or a change to the business model investors might end up happy not perhaps sellers not so much.

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