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Etsy to Pay Off for Investors

Over the years, people have poked fun at some of the handmade items listed for sale on Etsy, but it seems investors will have the last laugh. Etsy’s IPO is expected to raise as much as $213 million for the company and puts Etsy’s valuation in the billions, not millions.

Etsy launched a roadshow on April 1 for the initial public offering (IPO) of its common stock. The offering is for 16,666,666 shares – Etsy is offering 13,333,333 shares and the selling stockholders are offering 3,333,333 shares. The selling stockholders have also granted the underwriters an option to purchase up to 2,499,999 additional shares.

Etsy published the expected IPO price at between $14 and $16 per share – which works out to be between $233.3 million and $266.7 million. At the high end, Etsy would get $213 million for its coffers.

Bloomberg does the math and says the high end implies an Etsy valuation of $1.78 billion based on about 111 million shares outstanding.

While the ultimate IPO price is no guarantee of how the shares will trade on the open market after the first 16 million-plus shares are sold, investors and vested employees are likely getting out their calculators to get a sense of how the value of their holdings will change.

Usually a company’s underwriter limits participation in an IPO to favored investors with big pocketbooks, but Etsy plans to reserve up to 5% of the shares to be sold in the offering as part of an IPO Participation Program for individuals.

Etsy added a footer to its website pages, “Interested in participating in our IPO? Learn more,” with a link. The program will be administered by Morgan Stanley Smith Barney LLC, see more information on this page of the Morgan Stanley website.


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Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.