
Etsy Vendors to get option to buy $2,500 of shares before public float - choppaface
http://www.wsj.com/articles/etsy-vendors-to-get-a-piece-of-ipo-1428971989
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netcan
Interesting tactic.

I suppose if you boiled it down, they are selling "5% of planned public
offering." So.. costs of selling those shares would be slightly higher. But,
they have some presence from people who see the company the roughly same way
they do, not as a piece of a portfolio or investment strategy. They get some
buzz around the IPO (this article demonstrates that), if vendors are
discussing it. It's not like they're giving away the shares.

A part of what's interesting is what's underlying it: an environment where so
much capital is in the hands of rich people that there's not much point
thinking of 'the public' as a source of capital.

I think income distribution is a lot easier to measure, comprehend and comment
on. But wealth disparities are much larger, and I think the societal effect is
different. If someone owns $2m in capital but $1.2m is a house and $1.8 is
actively invested to yield an income of $75k per annum, is that person rich or
are a middle class investor?

There's definitely markets for the middle classes. Apple, Walmart, etc are the
biggest companies in the world and their business is selling stuff to us. But
if your business is selling financial services or you want to raise capital,
the middle class is irrelevant. It's not about risk or sophistication of the
investor, it's about them not really having capital. I reckon that's
significant. WHo has the capital matters.

Money gets even more theoretical when talking about capital. When you earn an
income and use it to buy goods as service, the metaphor-made-real of money is
relatively straightforward. I work for a company that makes medicines. They
may me a salary which I can exchange for stuff other companies make. With
capital, the link to physical things is broken. It becomes more of an abstract
right^ to things. The right to establish a company. The right to future
revenues from some venture. Rent…

^"right" isn't exactly it. It's somewhere in the ability/resource/right realm.

~~~
zyxley
> and $1.8 is actively invested to yield an income of $75k per annum

I would say "never actually having to work again if you don't want to" is a
fairly strong indicator for being "rich" in the sense that most people
understand it.

~~~
pyre
A lot of people equate "rich" with "I can buy anything I want to at anytime,
and cost is not a consideration."

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davej
This is more than just a nice gesture, it's also a very shrewd long-term
business strategy.

The majority of the value in the Etsy platform comes from their vendors and
community. If they didn't have vendors then the site wouldn't be so
successful. Etsy are ensuring that their vendors are invested in the site with
them and less likely to jump ship to a competing platform.

~~~
TorKlingberg
Etsy sellers are also less likely to try and push out the founders than Wall
Street. They probably will not go to the shareholders meetings at all, and if
they do they will not be pushing for short term profits that would hurt Etsy
in the long run.

~~~
pyvpx
it's 5% and probably not any voting-class shares. that's a nice thought,
though.

disclaimer: I did _not_ RTFA

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fabulist
Non-paywall link: [https://archive.today/kLrVp](https://archive.today/kLrVp)

For reference, I find archive.today to be the most reliable way to bypass
WSJ's paywall. I've never had occasion to bypass any other paywalls.

~~~
blumkvist
Hehe, I wonder why I'm sure you are using adblock too.

They are litering the Internet with stupid ads and malware!!!! Adblock is my
right!!!!! Give us an option to pay for content, stupid publishers!

This is why, the Internet will always rely largely on ads.

~~~
fabulist
You've got me on that one.

I have high hopes that the Internet will find a way to finance itself that
isn't based on ads/surveillance. I'm thinking of launching a platform to
monetize sites.

~~~
themartorana
I would like to think that someone will find the happy medium between target
advertising and privacy, but I don't hold out much hope. When ad companies get
sold and acquired (like Flurry for $300m to Yahoo!) the buyer is not buying
their ability to serve an ad.

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ComputerGuru
Has anything like this been done before? It's a curious concept. It's
certainly costing the company ~nothing (legal, financial, broker fees aside)
but it's an incredible gesture to the community that made all this possible.
Very clever - and touching!

~~~
wodenokoto
Why the tilde in front of nothing? And doesn't this dilute the value of the
stocks hold by current owners?

~~~
recuter
Selling $2,500 worth of shares to their vendors is exactly the same as selling
it bankers who will flip it to the public. They get $2,500 no matter what.

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choppaface
Sorry for the WSJ-paywalled link; the full story is currently available via
Google referrer:
[https://www.google.com/search?q=Etsy+Vendors+to+Get+a+Piece+...](https://www.google.com/search?q=Etsy+Vendors+to+Get+a+Piece+of+IPO)

~~~
SunShiranui
Doesn't work for me :(

~~~
Torn
Try adding site:wsj.com to the query

[https://www.google.com/search?q=Etsy+Vendors+to+Get+a+Piece+...](https://www.google.com/search?q=Etsy+Vendors+to+Get+a+Piece+of+IPO+site:wsj.com)

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jasonlotito
My wife is an Etsy Vendor. This is the first we heard about this, and we were
interested in this IPO. Granted, with our experience with Etsy, this is not
surprising.

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circa
Regretsy just popped into my head and I go to find it and it does not exist
any more.

However this does -
[http://missingregretsy.tumblr.com/](http://missingregretsy.tumblr.com/)

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drewvolpe
The Boston Beer Company (which makes Sam Adams) did something similar when
they went public in the 90s. They set aside a chunk of their IPO and allowed
their customers to buy shares at 25% less than the IPO price:

[http://www.nytimes.com/1996/11/24/business/boston-beer-
the-s...](http://www.nytimes.com/1996/11/24/business/boston-beer-the-sad-fall-
of-an-ipo-open-to-all.html)

~~~
twoodfin
And a $15 share (discounted from $20) from 1996 would today be worth $264.
CAGR of 16%, not bad—though most of BBC's growth was in the last few years.

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iblaine
This has been done before. VA Linux did this in 1999 for users with
sourceforge accounts. Those free shares were worth ~$45k on the day of the
IPO.

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3pt14159
I can't seem to find the IPO link, unless it is this one:

[https://etsyipo.morganstanley.com](https://etsyipo.morganstanley.com)

Which looks like it is now closed. Too bad, this stock is definitely going to
be overbought after IPOing.

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oneeasyride
I just found out about this today, very unfair , Does anyone know what the pre
IPO price per share was offered at? Please email me at oneeasyride@aol.com

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jaksmit
it's not just limited to Etsy Vendors. there's been a link for anyone to
participate in this pre-ipo program in the footer of the Etsy website for
weeks now.

It's a shame that they didn't go with LOYAL3, as discussed in the article -
it's much less forms and paperwork than Morgan Stanley required.

~~~
swamp40
I don't see it (even logged in). Have you got a link? Thanks.

~~~
curious_george
It's no longer available. It appears to have been at:
[https://etsyipo.morganstanley.com/etsy/index.html#/sps/dspIP...](https://etsyipo.morganstanley.com/etsy/index.html#/sps/dspIPOForm/closed)

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oneeasyride
They say it closed to us on the 13th , which is very unfair to most of us who
found out today

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danvoell
LendingClub recently offered this option. At this point shares are down from
the IPO.

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testingonprod
Isn't this beautiful?

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pearjuice
Can someone add a [paywall] tag to the title? Or provide an URL/mirror which
isn't paywalled?

~~~
zaroth
More like a [payspeedbump].

