Etsy: "House of Brands"
(Etsy Q2 FY21 Earnings Review)
By the time I came around to study the Etsy Q2 earnings (I often skim first, and come back weeks later for a deeper look), the management team had taken part in both the KeyBanc VTL forum and the Canaccord AG conference. As such, I may include snippets from both of those discussions.
In this quarter Etsy would be comping a quarter that, last year, saw revenues jump 88% from the first quarter of 2020, and over 137% from their 2019 base after the physical commerce environment shut down and consumers were suddenly left with fewer options to consume in the real world. In light of these fewer options, Etsy became one of the benefactors of a shift in consumer behaviour.
So, one year on and Etsy are no longer in a position where they are embracing a wave of circumstantial demand but, rather, in a place where they are now seeking to retain and engage that surplus of new buyers and sellers which came to the platform in 2020.
To sprinkle some context on just how excessive that influx of buyers was, consider that over the TTM period Etsy have welcomed 40M, new buyers, to the Etsy marketplace (those who have never shopped on Etsy before). In the quarter prior to the pandemic (Q1 FY20), the Etsy marketplace had an active buyer base of ~47M.
From annual active buyer growth rates of between 16% and 21% in the five years trailing the pandemic year, Etsy witnessed a 77% spike in active buyers by the end of 2020.
Thus, and this has been repeated many times, Etsy pulled forward a great deal of buyer and seller onboarding over the last year, something which I believe only stands to benefit them in the long-term. Whilst growth rates will now be slowing down, one has to remember that the base effect plays a critical role. Reading between the lines and through the numbers is important in understanding the bigger picture.
For continuity, I must state that Etsy is a position I currently hold in my portfolio (weighted at ~10%).
Key Takeaways from Q2
Consolidated GMS ($3B) up 13.1% YoY, non-mask GMS up 31%. Etsy marketplace GMS was $2.8B (+14.2%).
Revenues of $528.9M (+23.4% YoY).
Marketplace revenues drove $395.5M (+19.1% YoY) of that sales base, whilst services ($133.4M) grew at a faster clip of ~38% YoY.
Transaction fee revenue grew 15% YoY, driven by higher GMS from visit growth and frequency. Payments revenue was up 19% and as Etsy processed 92% of the etsy.com stand-alone GMS through Etsy Payments.
Etsy marketplace shaved ~100,000 active buyers (now standing at 89.6M), whilst the consolidated business shaved ~164,000 active buyers (now standing at 90.5M). Sellers rose 11% sequentially, now standing at 5.2M.
Repeat and habitual buyers remain relatively flat QoQ, standing at ~49% of the total buyer base.
The launch of the Star Sellers programme should encourage greater customer service interactions, and incentivise sellers.
The development of XWalk, the real-time graph retrieval engine, should allow Etsy to capture greater meaning from search queries, increasing the real-time data capture from search by up to 11x.
Two acquisitions closed in July, Depop and Elo7, for a combined sum of ~$1.84B and welcomed an additional ~550 new employees.
Etsy: "House of Brands"
Where to begin…
I will start with the most pertinent of updates, in that Etsy has closed the acquisitions of two businesses this quarter in Depop ($1.63B) and Elo7 ($217M), both of which are not included in the financial results for this period, given the timing of their closures.
With both acquisitions, Etsy has enacted category expansion within the apparel market (Depop) as well as a more direct geographic expansion in Southern America (Elo7), namely in Brazil.
After a fairly active period in the M&A market, I would suspect Etsy cool their jets here whilst they shift the focus towards their two new businesses which, together, brought in ~550 new employees to the headcount. This appears to be echoed by Silverman, who stresses that the work has only just begun for these integrations.
“We've just kicked off integration work for both businesses, so it's important to keep in mind that it will take multiple quarters and years to operationalize all of the many ways that we believe we can help Depop and Elo7 grow.” - Josh Silverman, CEO of Etsy, Q2 FY21 Earnings Call
The Depop business is already well established in three of Etsy’s seven core markets (US, UK, and AUS) but after doing $650M in GMS and $70M in sales last year, the company likely faces the same headwinds that Etsy marketplace does this year.
Whilst management has expressed intent to maintain Depop’s status as a stand-alone entity, there are a number of areas that Etsy can leverage its core competencies to further improve the Depop platform. From marketing costs and promotions to seller services, and search & discovery, these are all areas that Etsy excels in. Glasser (CFO) even remarked that there is potential for Etsy Payments integration in the future.
As such, the priorities for Depop largely circulate around increasing global brand exposure, improving customer experience, expanding the range of value-add services for sellers, and ROI focussed marketing. Silverman was so bold as to say “we think Depop is potentially to Etsy like Venmo was to PayPal, a new way to shop for the new generation.”
That is a bold statement.
Venmo, the smaller payments business that PayPal acquired as part of a deal to purchase Braintree for $800M in 2013 is expected to generate over $900M in revenues this year with a little over 76M active users. What is interesting, is that Venmo was more or less an afterthought in that deal, and turned out to be a touchdown for PayPal. Whilst the quote is remarkable, it will take a number of years before we can test its validity.
Contrary to Depop, Elo7 (which is a much smaller operation) did not benefit from significant tailwinds during the pandemic. As over 50% of their sales are generated from "special event and life moment" categories, the relatively harsher impact of shutdowns paired with a weaker commerce infrastructure in Brazil meant that Elo7 got knocked down and stayed down during 2020.
Brazil is a tough market, with high barriers, that often is more accepting of native commerce businesses, such as MercadoLibre. One only need to look at eBay’s failure in the region as a premise for how difficult it can be to enter that market successfully.
The South American market is a hotbed for commerce growth, however, with the size of Brazil (LATAM’s largest e-commerce market) projected to reach $50B by FY25, roughly the size of the entire market in FY19.
With the Elo7 acquisition, Etsy is taking a local-first approach, with no plans to integrate Etsy branding into the Brazillian marketplace. Therefore, Elo7’s 24M monthly visitors will continue consuming items from a stand-alone business, but one which is now equipped with the expertise and resources of the Etsy collective.
I feel this is a wise approach from management. Unlike Etsy’s integration of platforms like DaWanda (part of the Germany expansion), the pertinent struggles that US firms face in this region suggest leaving Elo7 as a separate entity is a correct decision.
The near term priorities for this business are improving conversion rates, marketing efficiencies, and both shipping and seller transparency.
Now that Etsy has a presence in Brazil, it raises the question of the expansion of Etsy’s “core markets” alongside the existing seven (shown in the table below).
Up until now, the definition of a core market has largely been a factor of whether or not the region has been a focus for the core Etsy marketplace.
Whilst there are still some ways to go in bolstering the participation of sellers in India (the newest core market) this is a region that only Etsy is included in. Both Reverb and Depop are also present within core markets, but Elo7 represents the first within Brazil.
At present, these three businesses (Elo7, Depop, Reverb) represent less than 15% of the total GMS, with Etsy still leading the top and bottom-line growth for the consolidated business. So, whilst they are still a small slice of the pie, I imagine that as they continue to expand across the globe, we may see an alteration as to what defines a core market, given that Silverman now refers to Etsy as a “house of brands”, a phrase which is young in the team’s lexicon.
Additionally, for platforms like Depop who are yet to expand into Europe or Canada, the learnings from Etsy’s presence in those areas will be most useful. Just this quarter, Reverb formed a new international product team.
Before I move on to the earnings results, the above table highlights the key priorities of each business for the remainder of the fiscal year with Etsy looking to retain and engage, Reverb looking to further their product and marketing investments, Depop targetting growth, and Elo7 seeking to improve the buying and selling experience.
Whilst on the face of it, Etsy are slowing down, the rate of change based on a heavily skewed 2020 is not the most important of insights. So, today I will be sticking to what is important.
Take GMS as an example. During the second quarter, Etsy produced $3.04B in consolidated GMS (up 13.1% YoY). This represents the second period of sequential decline after Q4 FY20 ($3.6B) and Q1 FY21 ($3.14B).
Put differently, the business has produced 61% of the entire GMS of 2019 in just three months. Put another way, that’s a 23.5% surplus on the full year 2019 GMS in just two quarters.
I doubt many when modelling Etsy in 2019, would have cited a 106% growth in GMS for the following year. In reality, the half-year GMS of 2021 might have been a more suitable projection for the full year of 2020.
Whilst Etsy does not guide for full-year GMS, they have suggested between $2.9B to $3B for the next quarter which, after the holiday quarter, should easily see Etsy come in at between $11.9B to $12.5B in GMS for 2021.
The most pertinent question, therefore, is not related to Etsy’s slowing growth rate, but rather circulates around whether or not they can retain this bolstered GMS base and continue to grow it at pre-pandemic levels from henceforth.
The take rate on that GMS came in at 17.4% this quarter, after $528.9M in revenues (+23.4% YoY). This is expected to remain flat in Q3 after a modest 300bps dilution from Depop and Elo7, both of which have considerably lower take rates across their platforms.
Glaser (CFO) stated that without the addition of those two businesses, the Q3 take rate for the pre-existing business (Etsy and Reverb) would be 17.7% in Q3.
Marketplace revenues drove $395.5M (+19.1% YoY) of that sales base, whilst services ($133.4M) grew at a faster clip of ~38% YoY. It was mentioned that Etsy ads, driven by increased revenue per visit, grew 47% YoY.
Gross margin came in at 72% ($380M in gross profit) bolstered, again, by the offsite ads product where opt-out rates remain below 2%. Management had suggested that the “number of sellers who've chosen to stay in the program is growing at a faster rate than active sellers”, offering up some testament as to how valued the offsite ads product is amongst sellers.
This puts Etsy’s 6-month trailing gross margin at ~73%. One has to remember that the considerable 620bps expansion from 2019 to 2020 has more to do with additional sales leverage exhibited last year, as well as some modest impact from the offside ads product, which is accretive to margin without an equal offset in cost of revenue.
Thus far, Etsy has proven that it can scale in a manner that allows for margin expansion in tandem. A testament to their asset-light model.
Similar causal effects were exhibited across consolidated operating margins last year, growing from 10.8% in 2019 to 24.6% in 2020. Without having to incur the traditional uptick in expenditure to attain that influx of new revenues (which were mostly brought to Etsy via the circumstances of consumers in lockdown) sales leverage propped up margins further down the income statement too.
For the year thus far, operating margins stand at 22.2%, with $89M in operating income being generated this quarter, in addition to $98M in earnings after benefits from income tax.
The core outgoing operational expense for Etsy is, and mostly always has been, their marketing efforts.
Despite being a benefactor from the pandemic bump, the management team have continued to accelerate marketing spend. In the quarter prior to the pandemic, Etsy would allocate $48M to marketing (21% of sales) and then lean heavily into marketing the following quarter. As sales jumped 88% over the next three months, marketing spend would accelerate 140% over that same period.
Just this quarter, Etsy allocated ~$35M of their ad budget across traditional television and radio top-funnel channels with localised campaigns across the US, UK, and Germany. This has caused Etsy to reach the 7th position (highest ever) in the iOS shopping app segment with 9M downloads YTD. Weekly app downloads have expanded from 275K to ~360K over the last three months.
As Etsy went so hard on top-funnel direct marketing during the second quarter, the GMS from paid channels (namely, offsite ads) fell 200bps YoY to 19% after the spend on performance marketing (paid) was flat sequentially.
As Etsy, Depop and Reverb have international growth in their priorities, I imagine that, for the time being, we may see operational expenditure catch up to the top-line whilst management reinvest across the expansion efforts of each of these businesses. This is as well as their domestic investments to expand Elo7 across SA. Whilst operating margins in the mid-20s are nice, as a shareholder, I understand that Etsy could (and should) be utilising more of their surplus EBIT to capitalise on these reinvestment runways.
Retain and Sustain
I have suggested the focal point for shareholders right now should be surrounding Etsy’s ability to retain and engage their new userbase. Over the TTM period, the company have welcomed over 40M new buyers (those who have never shopped before) onto the Etsy marketplace.
As I stated in my opening remarks, just 5 quarters ago, Etsy’s entire active buyer base was ~47M.
Sequentially, the Etsy marketplace shaved ~100,000 active buyers (now standing at 89.6M), whilst the consolidated business shaved ~164,000 active buyers (now standing at 90.5M). This is perfectly natural as the economy continues to re-open and consumers are once again gifted greater choice in their consumption habits. Not much signal there.
Despite the relatively flat buyer base, sellers on the platform increased 11% sequentially, growing from 4.7M to 5.23M, offering up a greater breadth of choice to those buyers.
Of importance, are those buyers who catalyse the greatest share of total GMS. Both repeat buyers (2 purchases within TTM) and habitual buyers (6 or more purchase days and over $200 in spending in the TTM period) now constitute ~49% of the active buyer base, up from ~42% at the beginning of the pandemic.
Whilst the habitual buyers remained flat sequentially (7.9M), it was remarked during Q1 that this cohort, making up just less than 9% of active buyers, account for ~40% of total GMS on the Etsy marketplace.
Whilst being sequentially flat is not inspiring, this group have not declined, whilst the active buyer base has fallen marginally, which does say something for retention. Albeit, three months of data is not critically important. Glaser suggested in the Keybanc Forum that this would be transitory (popular word this year).
For Etsy to come through on its intention of retaining and engaging this cosmic onboarding of new buyers, the composition of repeat and habitual buyers is an important KPI to give credence to that ambition.
So that’s retention, but what about engagement?
GMS per active buyer increased 4% sequentially (23% YoY) to $129, an incremental $5 improvement from last quarter.
GMS per active buyer does not exclude mask sales, thus the contrarian might question the validity of such a metric. A simple observation to hastily quash that argument is the sharp decline in masks as a percentage of total GMS. From highs of 14% in Q2, mask sales are now just 1.5% of total GMS (or 1.4% of Etsy marketplace GMS). The is expected to continue declining as management are “forecasting very little GMS from face masks in [their] Q4 2021 internal model”.
The point I am attempting to make here is that despite signs of stale buyer growth (which may or may not be transitory), the frequency with which those existing buyers are consuming is improving. Further evidenced by the sequential improvement in GMS per new buyer.
Before moving on to the balance sheet and concluding remarks, I will provide a brief rundown of two themes I wanted to expand on in product and international opportunities.
I realise that this piece may be droning on somewhat, and I am all about reducing verbosity, so here’s a quick run-through of some of the significant enhancements to the consumer experience that took place during Q2.
XWalk: A real-time graph retrieval engine that increases real-time data capture from search by up to 11x, from ~240M data points to ~2.7B. By expanding the amount of data utilised in search, Etsy can capture greater meaning from a user’s search queries and show them more relevant inventory. This reduces the number of dead-end searches and allows Etsy to more efficiently utilise the information they capture on user activity. It is said that this early iteration of XWalk has already unlocked over 1M incremental searches, bolstering the relevancy of each search outcome.
“We're only at the very beginning stages of leveraging XWalk, which has many other applications beyond search, for example, making recommendations more relevant, providing better on-site marketing experiences and improving technologies that keep the Marketplace safe.” - Josh Silverman, CEO of Etsy, Q2 FY21 Earnings Call
The Star Seller Program: Announced on July 28th, the star seller program identifies the best sellers on the marketplace, defined by metrics important to buyers including on-time shipping, 5-star reviews, and general responsiveness to buyers. In an attempt to gamify the seller process and usher in a sense of agency to sellers, these market participants now have a benchmark on which to score themselves, whilst the process of discovering high-quality sellers becomes more lubricated for buyers. Later this year, Etsy will begin to surface Star Seller Badges to applicable accounts.
Thank You Coupons: Sellers are now able to offer coupons, post-purchase, to buyers offering discounts on their next purchase in that seller’s store. A simple value-added service for sellers, and an incremental repeat purchase driver for buyers. 11% of purchases on the Etsy marketplace contained a thank you coupon in Q2.
Delivery and Shipping: Whilst Etsy are not fighting the Amazon race in terms of being the best at next-day delivery, their shipping and delivery transparency has long been poor. In 2020, more than 30% of purchased orders did not have an expected delivery date disclosure. Through an update in how Etsy process ZIP codes, they expect this will be the case in fewer than 10% of orders by the end of the year.
Video: Whilst there have been no updates to video in Q2, after one year since launch, the Etsy marketplace has now uploaded over 8M listing videos to the platform, up from 5M last quarter. Video is a prime medium for engagement, so promising early signs.
I highlight the above because each relates to the improvement of customer experience (both buyer and seller) as well as conjuring up additional avenues to supplement both frequency and retention for buyers. Of particular interest, to me at least, is the XWalk project.
Part of the underlying thesis for Etsy consists of their ability to scale the collection of brands they operate across borders.
International GMS (which grew 45% YoY) currently accounts for 41% of total GMS, up 700bps from the first half of 2020. A reminder that international involves transactions whereby either the buyer or seller is not located within the US.
Domestic international, on the other hand, is when both the buyer and seller are inside the same market but outside of the US, and was the “fastest-growing trade route was once again” this quarter.
I discussed the difficulty of creating two-sided marketplaces in my Q1 earnings review (so for greater context, check that out). In short, the Etsy model first expands to a new market, grows in that market utilising international transactions, and then (in the best of outcomes) fosters a thriving domestic international relationship between buyers and sellers. This is the cultivation of that “lightning a bottle” that Silverman refers to so often. In this case, Etsy is placing flywheels in new markets, lubricating the wheels and then eventually allowing them to spin on their own.
We saw, last quarter, that management is not concerned about the short term margin implications of leveraging additional marketing spend across international channels, most notably in the UK and Germany. This quarter, brand spend (up 73% YoY) accounted for 23% of total marketing spend and was largely attributable to both of those markets.
The reinvestment runways across international markets propose a sumptuous opportunity for a continuation of the attractive ROIC that Etsy has exhibited over the last four years.
I have stated this in previous posts, but to boil it down to one sentence:
Through a high-margin, asset-light, business model which kicks off considerable free cash flow margin, the best for that cash is to continue reinvesting back into the business to A) expand the Etsy marketplace across the globe and B) continue to enhance the customer experience of each of the other brands whilst simultaneously expanding their geographic reach.
By doing this, Etsy can create a global network of two-sided “domestic international” marketplaces that become self-sustaining after their respective flywheels (the mutual growth of domestic buyers and sellers) begin to spin.
Liquidity and Cash Flow
Despite ending the quarter with over $2.5B in cash and marketable securities, the balance sheet (below) was yet to include the impact from both the Depop and Elo7 acquisitions.
In June, Etsy would raise an aggregate of $1B in convertible notes, set to mature in 2028 with a conversion price of $246.80 at 0.25% interest. Despite setting aside a portion of the proceeds for share repurchases (~$180M) I imagine this was issued in part to fund the acquisitions of Depop and Elo7, both of which were acquired primarily using cash for a total sum of ~$1.84B.
Aside from the residual value of the 2018 convertible notes due next year, Etsy have no pending maturities until 2026, as well as an untapped $200M revolver. Even with the inclusion of both acquisitions, it would appear that Etsy is still comfortable with respect to liquidity. Whilst management could leverage the entity further, management’s comments suggest there is no more sizeable M&A activity expected this year.
Again, not reflecting the acquisitions here, but Etsy’s $665M inflow from financing largely stems from their $1B note issuance during the quarter, offset by the repurchase of shares ($180M), the purchase of capped calls on those notes ($85M) and the repayment of some long-term debt, as well as debt issuance costs.
Financing inflows ($101M) are largely construed of Etsy’s marketable security activity, with a higher composition of proceeds from the sale of securities this quarter, offset in part by a modest $5M in CapEx spend.
The extent of Etsy’s asset-light model really shines here, when we consider the relative minuscule Capex which allows them to retain over 95% of their operating cash flow as free cash flow. Here is a business that, over the TTM period, has generated $699M in operating cash flow, with 98% of that converting to free cash flow, or close to 32% of their TTM revenues.
Granted, similar to Etsy’s margins over the last year, a great deal of this has been afforded by superior sales leverage, but it goes to show what this business can do under scale.
Guidance for Q3 FY21
At present, Etsy is not providing guidance for the fiscal year.
Q3 Fiscal 2021 Guidance
Consolidated GMS to come in between $2.9B and $3B, which would represent a ~15% YoY comp on third-quarter GMS.
- Etsy marketplace GMS mid-single-digit growth. Part of reading between the lines here is respecting that Etsy’s GMS grew 116% during Q3 FY20. Equally, during this quarter masks drove 11% ($264M) of the Etsy marketplace GMS. All in all, a monstrous comp.
Revenues of between $500M and $525M, which would represent a ~16% YoY comp on third-quarter revenue, and fourth sequential decline in sales.
Consolidated take rate of ~17.4% (or 17.7% excluding recent acquisitions)
Adjusted EBITDA margin to be ~25% (includes both Depop & Elo7)
- Without recent acquisitions, the EBITDA margin is expected to be ~28%.
Full Year Fiscal 2021 Guidance
Etsy is not currently issuing full-year guidance.
For me, this was a suitable quarter for Etsy, which are now showing some of the signs that the re-mobilisation of the economy incurs on businesses such as these.
I do like both acquisitions, but am thankful that Silverman has stated the “primary focus now is to integrate Depop and Elo7 into the family while continuing to drive strong performance at Etsy and Reverb”.
Whilst not totally disregarding the idea of future M&A, suggesting they will be “patience and picky” about seeking future marketplaces to acquire, I admire the stance that they are happy with these two deals for now.
On future M&A, Silverman would remark (during the Cannacord conference) that they only seek those businesses which match the Etsy model (i.e no inventory), exhibit a true peer-to-peer merchandise experience, and be a brand that appears well-positioned to be a leader in its marketplace, citing that Etsy are “not interested in doing turnarounds or resuscitating brands that have maybe fallen and their best days are behind them.”
Etsy is not a business that invests through the balance sheet. I think it’s quite clear that their primary method of expansion, customer capture, and “reinvestment” stems from their income statement, namely their marketing efforts.
What has been pleasing, over this tumulous period, is that Etsy has continued to reinvest here. In fact, they have accelerated spend in this area. After the acquisitions of Depop and Elo7, in tandem with the international aspirations of both Esty and Reverb, Etsy appear to have considerable reinvestment runways to continue spending in both performance and brand marketing to attract new customers onto their respective platforms. Thus, offering up a potential slow-burning catalyst that should secrete ROI for many years to come.
Whilst those in the e-commerce industry certainly pulled forward a great deal of business over the last twelve months and will likely face some retraction in aggregate demand, this tailwind is not one that is damaged in any way shape or form. This is particularly true across South America and India, where the reinvestment runways appear to be considerably longer than, say, the US or the developed nations within the EU.
It Only Gets Tougher
In the short term, it only gets tougher, if one doesn't wish to read between the lines. The following two quarters are comping two of Etsy’s most successful quarters, in particular the fourth quarter where they experienced an excessively strong holiday period with an elongated holiday shopping season, stimulus payments, and a re-introduction of lockdowns across certain markets. A perfect storm of sorts, for Etsy at least. This quarter also contained ~$133M worth of mask-based GMS (4% of GMS), something which will become immaterial in the fourth quarter of 2021.
Even after this fiscal year, the first quarter of FY22 will comp another three month period government stimulus checks influenced a significant level of consumption across Etsy’s core market, the United States.
I don’t doubt that narratives will shift during the next 3-4 quarters. More than likely, those narratives will be voiced by those who don’t follow Etsy too closely.
Whilst some may say Etsy is a mask strong (a feeble argument at best), I take the opinion that mask sales during 2020 show the flexibility of the Etsy business.
Within weeks, the Etsy marketplace became a hotbed for masks. Not a “trend” item, of course. One which was mandated, but still acts in the same manner as a trending item.
Within weeks, this product, which didn’t exist on the marketplace (or was so immaterial) generated $850M worth of sales (for Etsy sellers) over an 8 month period.
I think Silverman did a wonderful job of explaining the brilliance of masks during his appearance at Cannacord:
“When things hit the consumer zeitgeist, a traditional retailer will call their suppliers and say, "Hey, when can you start making this?" And if they're really fast, they'll get it 8 weeks or 12 weeks from now. So constantly, they're in the business of guessing what's going to be popular 3 months from now, putting their balance sheet at risk to buy often hundreds of thousands of units or more of that product, store it in a warehouse and then ship it to a customer. Etsy's business has nothing to do with that. Our sellers respond in minutes to what's popular in the zeitgeist.
As soon as you can imagine it, they post it on Etsy. And then when a customer buys it, they make it and then they ship it.” - Josh Silverman, CEO of Etsy, Cannacord Conference
The biggest question, for me at least, rests upon how buyer frequency and retention pans out over the coming 12 months. I am in no doubt that Etsy is now a greater business today than it was pre-pandemic. Brand exposure, buyers, sellers, are all more significant and more widely dispersed.
It is my belief that the continued penetration of global mindshare comes from Etsy’s assistance in reinvesting through their international marketing efforts.
Time will tell.
As someone who currently holds Etsy at a 10% weighting (therefore, one should appreciate my apparent or subconscious bias) I am optimistic they move forward in a positive manner from here. Whilst the next 12 months may be choppy, a great deal of insight as to whether or not this business has longevity will be extracted from the results.
As a final comment, the Etsy business which stands today is likely similar to what a bullish analyst would have forecasted it to be somewhere between 2023 and 2025. This simplifies the notion that one has to be both a security analyst and a business analyst.
I am admittedly more of a business analyst and, as such, am more interested in where I believe the business will be over 3Y to 5Y, which is something else to consider when reading my work.
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Lead Analyst at Occasio Capital Ltd
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