Etsy launches test of crowd­fund­ing

Los Angeles Times - - COMPANY TOWN - As­so­ci­ated press

The crafts e-com­merce site Etsy said Tues­day it is test­ing a pro­gram to en­able sellers on its site to seek fund­ing, fol­low­ing in the foot­steps of pop­u­lar crowd­fund­ing sites.

The pro­gram, called Fund on Etsy, will let Etsy sellers raise money on the same site on which they sell their goods. The funds can be used to buy new equip­ment, cover ma­te­rial costs, hire em­ploy­ees or de­fray other costs.

The U.S.-only pro­gram will be avail­able to a few re­tail­ers on the site for two months from June 16 to Aug. 16.

In one ex­am­ple, hand­bag maker Tielor McBride, who runs the shop TM1985, hopes to raise $10,000 to cover the cost of cre­at­ing prod­uct sam­ples and im­prov­ing the pro­duc­tion and de­sign process of the bags.

Crowd­fund­ing web­sites such as Kick­starter and GoFundMe have gained pop­u­lar­ity in re­cent years as ways for peo­ple to raise money for var­i­ous ac­tiv­i­ties.

Etsy Inc., which turns 10 in June, went public amid much fanfare in April, with the stock nearly dou­bling from its IPO price on the first day of trad­ing as in­vestors clam­ored for a well­known name in the re­tail in­dus­try. But shares have de­clined over in­vestor con­cerns about coun­ter­feit goods be­ing sold on the site.

In its most re­cent first quar­ter, the New York com­pany’s net loss to­taled $36.6 mil­lion be­cause of costs re­lated to restruc­tur­ing and a tax pro­vi­sion. Mean­while, rev­enue jumped 44% to $58.5 mil­lion from $40.5 mil­lion.

Etsy shares fell 3 cents, or 0.2%, to $16.29.

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