ETSY's Sale of Depop to eBay (for $400M less) - Two Different Paths of Growth

Etsy sold Depop to eBay for $400 million less than what Etsy paid for it, and this might be a win for both parties based on their respective growth strategies.

This deal intersects multiple areas of strength for Cadet Legal - M&A, consumer/ecommerce, and fashion.

More than the specific terms of the deal, I am fascinated by what it represents in the diverging growth strategies for both eBay and Etsy.

Sometimes growth means being acquisitive and opportunistic, looking outward (inorganic).

Other times, growth means doubling down on the basics, and lasering in on core competencies and operational infrastructure (organic).

As we’ve been discussing M&A as a means of inorganic growth, we have also stressed the importance of integration. To unlock value, a buyer must effectively integrate any newly acquired pieces into its existing business/platform. The converse also proves true. Sometimes, to focus on organic growth, you must become an M&A seller, disentangling yourself from verticals or product lines that aren’t quite fitting.

Etsy seems to be focused on organic growth, a path of divestiture of non-core assets and investment into its internal operations. On its face at least (without allowing for accounting moves like impairment), Etsy’s sale of Depop came at a loss of $400 million (less than what Etsy paid for it) and the sale did not occur in a vacuum. Rather, it figures into a larger growth strategy. It follows a management reorganization in which longtime CEO Silverman stepped down at the end of 2025, transitioning to the role of executive chairman. Kruti Patel Goyal, previous head of Depop and Etsy's chief growth officer, moved to the CEO chair January 1st.[https://lnkd.in/gix_wZF7]. The Depop sale also follows the sale of another non-core department (Reverb, a musical instrument marketplace) earlier in 2025 [https://lnkd.in/gKX8wrKb].

In contrast, this deal suggests that eBay is embarking on a campaign of inorganic growth, executing a buy and build strategy not dissimilar to what Cadet Legal clients are pursuing in the lower middle market. The Depop acquisition gives eBay almost instant access to a younger customer demographic without having to build that customer base itself. eBay’s acquisition of Depop follows its purchase of Tise, a Norwegian secondhand marketplace in 2025 [https://lnkd.in/gumnxkEb]. That deal is reported to have added about 1 million active buyers to eBay’s buyer base by year‑end 2025. We’ll see how well eBay integrated these new toys.

OPportunities for growth and profit are all around for smart business people who keep their OPerations in focus. We’re here to help you #WatchTheOps.

Disclaimer. The contents of this article should not be construed as legal advice or a legal opinion on any specific facts or circumstances. Your viewing and/or use of the contents of this article do not create an attorney-client relationship with Cadet Legal. The contents are intended for general informational purposes only, and you are urged to consult with counsel concerning your situation and specific legal questions you may have.