Etsy is buying the fashion resale app Depop for $1.6 billion.

    According to the deal, Depop has raised $11.6 million in funding from investors, including Andreessen Horowitz, Lerer Ventures and Y Combinator.

    Etsy announced on Tuesday that it has bought an online fashion resale app called Depop for $1.6 billion, or approximately $860 million in cash and $1.2 billion in stock. The move is part of the company’s ambition to become a one-stop shop for all things creative and handmade.

    word-image-9420 The Depop pop-up shop in London in 2019.Credit…avid M. Benett/Getty Images Depop, Gen Z’s favorite fashion resale portal, is being acquired by Etsy for $1.6 billion, the two companies announced Wednesday. The cash deal, which is expected to close in the third quarter of this year, highlights the growing influence of apparel resale platforms. More and more customers are turning to the second-hand market to find cheaper and – potentially – more environmentally friendly clothing, as the overproduction of clothing continues to feed landfills. This trend seems to have accelerated in the wake of the pandemic, as more and more customers want to clean out their closets, make money selling old clothes, or start their own clothing business from their bedrooms. Investor interest is also increasing. Last month, Vinted, Europe’s largest marketplace for used cars, raised €250 million in a funding round that valued the startup at €3.5 billion ($4.26 billion), while in the US companies like ThredUp and Poshmark went public this year. Founded in 2011, Depop has been particularly successful in creating a market for young consumers, who are embracing second-hand fashion faster than any other group. Ninety percent of users are under the age of 26, with 30 million users in 150 countries. The platform is best known for vintage clothing and streetwear, and for creating a new cohort of online promoters who have become famous for selling their wares. We’re just thrilled to add Depop – which we consider the resale platform for Generation Z – to the Etsy family, says Josh Silverman, CEO of Etsy. He said he thought the platform had significant potential to expand further, and said he saw significant opportunities for shared expertise and growth synergies for Etsy’s apparel business, which was valued at $1 billion last year. According to the Boston Consulting Group, the global market for used clothing is worth up to $40 billion a year, or about 2% of the total clothing market. It is expected to grow by 15-20% per year over the next five years. The transaction is expected to close in the third quarter of 2021, subject to antitrust investigations in the UK and US. Read more word-image-9421 Travelers at Dallas Fort Worth International Airport in May. Air traffic is growing and demand for oil is increasing. linked to credit Nitashia Johnson for The New York Times.

    Oil

    Oil prices rose Wednesday, with futures remaining at their highest levels since late 2018. U.S. West Texas Intermediate crude oil rose 1% to $68.40 a barrel. The Organization of Petroleum Exporting Countries and allied producers, such as Russia, met on short notice Tuesday and agreed to go ahead with their plan to phase out oil production cuts. OPEC also noted that oil demand is showing clear signs of improvement and that inventories are declining as the economic recovery continues in most parts of the world.

    Shares

    U.S. stock futures were little changed, while most European stock indexes rose. The Stoxx Europe 600 Index rose 0.2% as gains in the energy and consumer sectors offset losses in utilities and semiconductor manufacturers. Hong Kong’s Hang Seng Index closed 0.6 percent lower and Japan’s Nikkei 225 Index rose 0.5 percent. Recent economic data points to a pick-up in activity, but investors are watching inflation data closely to see if there are signs that the recovery is not temporary and that central banks need to take action to keep inflation in check. The Organisation for Economic Co-operation and Development announced on Wednesday that the annual inflation rate for its 38 member countries rose to 3.3% in April 2021 from 2.4% in March. This increase was due to a 16.3% rise in energy prices, the largest increase since September 2008.

    Other markets

    AMC shares rose nearly 30 percent in the premarket after the cinema chain announced it had raised $230.5 million in a share sale to Mudrick Capital Management. AMC’s share price has already risen from $2.01 in early January to $32.04, bringing its market value to $16 billion. The company was able to take advantage of the fact that retail investors were buying the stock (as well as other meme stocks) and raise additional capital to deal with the pandemic. Read more word-image-9422 Verizon workers remove traffic cones after laying fiber optic cables at 138th Street and Park Avenue in the Mott Haven neighborhood of the Bronx in New York last week.Credit…Desiree Rios for The New York Times Veterans of the nation’s decades-long effort to expand broadband access fear that President Biden’s new infrastructure plan has the same bias as that of his predecessors: Billions are being spent to expand Internet infrastructure in the most remote areas of rural America where few people live, while little is being spent to connect millions of urban families who live in areas where they cannot afford broadband service. It makes political and economic sense to spend billions of taxpayer dollars to build broadband in rural communities, which are a large part of former President Donald Trump’s political base, which Biden is seeking to win over. But some critics fear that a rural-centric strategy will leave out urban America, which is more densely populated, diverse and productive, Eduardo Porter reports for the New York Times. According to the Census Bureau, about 81 percent of rural households have a broadband connection, compared to about 86 percent in urban areas. But the number of urban households without a connection – 13.6 million – is almost three times the number of 4.6 million rural households without a connection. Connecting urban families does not require laying thousands of miles of fiber optic cable across prairies and open spaces. Telecommunications companies have already laid large amounts of fiber and cable in cities. Extending broadband access to underserved urban households, most of whom live in low-income neighborhoods and are often families of color, generally requires cheaper and more relevant connections. Read more

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