Crafty commerce site Etsy gets $27 million in funding

One of New York's most talked about tech start-ups these days is undoubtedly Etsy, the Brooklyn-based online marketplace for buying and selling handmade goods. And it's continuing to generate headlines: co-founder Robert Kalin announced in a blog post Wednesday that the company has picked up an impressive $27 million in Series D financing.

The venture funding comes from existing investors Union Square Ventures and Hubert Burda Media, as well as Accel Partners' Jim Breyer, who will take on a seat on Etsy's board of directors.

Etsy is "almost break-even" when it comes to profits, Kalin admitted in his blog post, but it does have 650,000 registered users, 120,000 of whom are classified as "sellers." The company employs about 50 people, and last year opened the Etsy Labs community space in a converted industrial space in Brooklyn.

With the new financing, the company hopes to achieve a laundry list of goals: expand beyond the U.S. dollar and the English language, improve its search and checkout technology, ensure that it can pay its employees fairly, keep its servers running, and have a "cushion" to ensure stability through current economic woes.

It's as much a social mission as an economic one, Kalin wrote. "Throughout the myriad challenges since we launched the Web site, we have worked day and night to see things through. We're in this for the long haul," he said. "We believe that the world cannot keep consuming the way it does now, and that buying handmade is part of the solution."

[pretty cheap jewelry]

Etsyians Can't Wait

As a veritable oldster of Etsyland (2 years as a seller), we can't wait for some of the 'little' things. Just a better on-site search, a shopping cart.

My niche as a bargain lover's jewelry shop http://www.prettycheapjewelry.com really needs customers to be able to search by price!

I love Etsy though, and it has had a huge positive impact on my life. (Doesn't that sound smarmy?)

[raynstarr]

Wonderful Site!

Etsy has an excellent business model that's strength lies not in how many buyers and sellers are in it's lists, but the loyalty and frequency of those members. When you go to the site you can feel what a community is there, and that people are committed to helping eachother's businesses and promoting "handmade" as a trade. Unlike e-bay, the site is uncluttered, un-junky, and people really care about making the best offerings possible. There are no mega-store sellers, just artisans who love what they make.
You should see the care and creativity people use in posting the pictures of their beloved wares!

I'm glad Etsy got a fresh inflow of cash. Going global is a great move for them. I just hope they can maintain the high quality, and community of the sellers as they expand.