Etsy.com & Kickstarter.com - "Opportunity Models"
I’ve written about brands with a conscience via their pro-social alignments, the role of core values in business and this post is about businesses whose models are about creating opportunities for individuals and their ideas. This is not a post about pro-social businesses; in fact, both companies I’ve chosen to focus on are both very much FOR profit.
(After the recent Presidential debates, and focus on job creation, it seemed fitting to publish this post next. )
The first company I wanted to talk about is Etsy.com. In case you’re not familiar, Etsy.com is a commerce marketplace where very (very) small businesses can sell handmade goods, vintage items and supplies globally. I’ve browsed the site several times, oogling handmade jewelery, homegoods and vintage everything but admittedly, it wasn’t until recently that I actually converted from lurker to buyer (here's what I bought if you're curious.)
I’ve developed more of a consumer conscience in the last few years. Wanting to really understand not only WHAT I was buying, but also WHERE it came from. It’s manifested itself in my motivation to buy local when possible and support small businesses in my community. I also find myself caring more about what a business stands for. After having the chance to sit down with Chad Dickerson, CEO, I realized that for me, the trifecta was complete. Aside from being incredibly smart and amiable, he embodies the values of the brand and has a strong and clear vision around not only Etsy’s growth, but the future of local commerce as well.
I knew the “what” and the “where” and Chad clinched the “why.” Our meeting began with a tour of his office and some items he’d recently purchased on Etsy. They included an awesome clock made from a bike rim as well as a portrait of Neil Young. The mini tour was followed by a full tour of the (dog friendly) headquarters in Brooklyn. It was like crawling inside the brand with its handmade gingham curtains, heavy drapery that wrapped a meeting room filled with plush vintage furniture and a piano (along with other instruments – there are several musicians that work there).
Once we settled in and began chatting it was immediately apparent that Etsy’s leader embodied the core values of the business. Helping its merchants succeed, sits at the top of the list and Chad personally spends several hours a month on the phone with its sellers.
Etsy.com is experiencing explosive YOY growth with August actuals registering in double digits, and it’s not stopping there. Just last month, Etsy launched Etsy Wholesale, a separate marketplace for select Etsy artists. Their partnership with West Elm meant that these select sellers were able to feature their items as part of an in store collection. Not only were these artists and products showcased in a major retail environment, they were all LOCAL. This type of offline, local curation is what Etsy’s CEO believes to be an important part of the future of local commerce for small businesses – I agree.
(Yesterday, a new release was posted about the launch of a Palo Alto West Elm location that will also be featuring products by Etsy artists. Story here.)
Through Etsy, artists and sellers have the opportunity to reach customers in a way they’ve not been able to do before. Etsy’s finely tuned brand and focus on its User Experience has won over the hearts of consumers and taken commerce beyond just enabling buying and selling but elevating it to a model with a conscience that lives both on and offline.
I spoke to Etsy artist, Emily Spada recently (who in full disclosure worked with me at one point) who recently has endeavored into the offline retail world. Her experience was summed up in the following quote, "I consider every sale a success because somehow, someone was able to find ME in all 6 million jewelry listings." Emily went on to explain that after using some similar sites, she moved to Etsy because she wanted a site that focused on artisans and maintained a sleeker, more beautiful design. Visit Emily's store here.
That brings me to the next business I wanted to talk about, Kickstarter.com. Kickstarter is a funding platform for creative ideas. Many of you are probably familiar with the platform and in this video I seek less to explain what it is but rather how it fits squarely into the bucket of businesses seeking to bring ideas to life in a way they may NEVER have otherwise been able to.
Creators have the opportunity to tap the public’s passion points for their ideas and raise funds (or pledges) to bring them to fruition. It’s a democratic process and only those businesses that succeed in raising their intended pledge level receive funding. This model not only serves to offer new opportunity to ideal holders but also allows people to invest in ideas and products they believe in. Not only is it a great idea in general but the fact that many ideas have received pledges in EXCESS (sometimes 2-3x) their intended goal illustrates that this model is not only an “opportunity model” but a passion channel. The site makes its category metrics available publicly, click here to view.
I think Kickstarter serves another, perhaps unintended purpose – insights. It’s hard to ignore that some of its most funded ideas happen to be fall in the entertainment category. What does this say about what people want? New ideas, new entertainment options that come perhaps from the long tail rather than just the major production houses. This insight, as well as others could very well serve as the beginning of a shift to crowd funded content at scale. Networks and content platforms, are you paying attention?
What are your thoughts on Opportunity Models?
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