It’s confirmed. Etsy really is going to IPO, as we’d heard. There’s a lot of stories out there where you can read basically the same narrative: Etsy used to be all handmade and crunchy; now it’s less crunchy.

Probably the best breakdown of Etsy’s IPO documents we saw was at NPR’s All Tech Considered. It illuminates many aspects of the filing, but perhaps most tellingly, that Etsy’s growth in revenue came from selling business services to sellers.

That’s why some new patents we found are especially interesting.

On the road to the IPO, Etsy shored up its position in the market as a technical leader in ecommerce. On Dec. 30, 2014, it was granted a patent for “a method of administering a live, interactive shopping event.” QVC 2.0?

The patent document goes on to describe a system in which at least one person can present an item on video and at least one person can see it and buy it. But if more people can see it, they can talk to each other over the video’s chat system, as well as someone on the seller’s side. The patent was first filed in 2009 and Etsy VP of Values and Impact Matthew Stinchcomb is credited as its inventor.

More schematics can be seen here. The documents seem to suggest that Etsy hopes to team up with editorial brands, such as fashion magazines, to host live events where buyers can purchase items shown during the event.


Will we see Etsy at next year’s New York Fashion Week? Or maybe at least this guy would be able to do his aura readings natively on Etsy, rather than jumping over to GoToMeeting?

The second patent is only an application, filed in June of last year, though the implications of this patent may be much more intriguing.

The basic idea of this patent seems to be that sometimes users look for things and the computer can’t figure out what they are looking for, which makes sense when you sell a lot of quirky stuff.

What the proposed system might be able to do, however, is connect the user with other users who have searched for similar things. It would improve a shopper’s chances of finding the right item by asking them some questions to aid the search, as shown in Figure 3 in the illustrations that go with the application. Figure 4 (below) shows what appears to be a dialogue between the buyer and a real person.

The filing refers several times to a “search facilitator.” It’s not clear if this is a computer program, a real person at Etsy or an Etsy user who doesn’t mind talking to other users about stuff they’ve bought.

What is clear from the patent application, however, is that it’s meant to use the history of what other users have looked for to help future users find what they are looking for.

The inventor is listed as Robert Kalin, Etsy’s founder.

What continues to be interesting about Etsy, as a company, is that its reputation as an innovator and leader in serious technology is only growing. So much so that the U.S. Patent and Trademark Office invited Etsy to speak about its DevOps philosophy at a meetup the agency sponsored.

According to the IPO documents Etsy filed with the SEC on Wednesday, the company’s gross profits broke $100 million for the first time last year, finishing at $122 million. However, Etsy operated at a net loss of $15.2 million last year. It is worth noting that the company upped its marketing budget by more than $22 million over the previous year. Clearly, Etsy is no longer relying on word of mouth.

Etsy filed to list on the Nasdaq stock exchange. It hopes to begin trading under the symbol ETSY by mid-April.

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