The pandemic has killed the old hustle culture and created a new one: Working for ‘me’
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The pandemic has killed the old hustle culture and created a new one: Working for ‘me’ Demands for more flexibility shine spotlight on fact that people, especially millennials, want more control in workplace and their lives Photo by Getty Images/iStockphoto
Article content Before the pandemic, Anna Spiridonenkova, 29, had been working in finance in Toronto, jobs with rigid nine-to-five schedules, although her colleagues, she said, would often arrive before 9 a.m. and stay well past 5 p.m. every day.
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Article content Last August, pushed by the pandemic, she switched to a more fulfilling — and more flexible — job as a programmer for a tech company. We apologize, but this video has failed to load.
tap here to see other videos from our team. Try refreshing your browser, or The pandemic has killed the old hustle culture and created a new one: Working for ‘me’ Back to video She had already been preparing to find a new job, but the pandemic, she said, was like “another sign from the universe.” “The world is changing and I already did some moves to change, so now it’s perfect,” she said. The pandemic’s worst has begun to peel away and Canadians have cautiously ventured back to real life, armed with lessons learned from the past year. The most common lesson? More control in the workplace. And, in turn, more control over one’s personal life. “What the pandemic has really shined a light on is that we don’t have a lot of autonomy on how we work and where we work and when we work, and people are looking for more control,” said David Zweig, associate professor of organizational behaviour at the University of Toronto.
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Article content Surveys conducted throughout the past year have shown a dramatic spike in demand for flexible working options, especially among millennial and Gen Z populations. With side gigs on the rise as well, this may mean a redefining for the North American hustle culture, a work culture well known for its long hours and emphasis on personal value based on time spent at the office versus output. High demand for flexibility A June 28 survey conducted by Ernst and Young Canada, a Canadian consulting firm, found that 93 per cent of Canadians surveyed are willing to stay with their organization, provided they maintain control over where and when they work. Without that autonomy, 53 per cent of respondents said they would quit their job for better options.
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Article content Millennials, the survey added, are twice as likely to quit than boomers. “For quite a few years, the dominant thinking is that millennials are much more interested in balance in their lives, hence their greater desire for flexibility,” said Laurent Lapierre, workplace behaviour expert at the University of Ottawa. I’m happiest when work isn’t the centre of my universe Shanu, 26 Millennials, several surveys in the past year show, are more likely to prefer remote working options, a hybrid office model, shorter workweeks. An Angus Reid survey published in June 2020 found that out of 1,510 Canadians surveyed, those aged between 18 and 34 years were much more likely to choose a 30-hour workweek than their older colleagues. “When I left school, I was very much in the hustle culture mindset,” said Shanu, 26. However, after working in a corporate environment, during which she rose to higher-level positions, she switched to a part-time role in July, working for a college.
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Article content “COVID-19 just exacerbates everything, like first of all, how silly it is to give that much of your life to work,” she said. Her current role, she says, allows her more freedom to schedule her day with personal downtime. “It is more fulfilling to work in challenging roles where I get to solve interesting problems,” she said. “But I’m happiest when work isn’t the centre of my universe.” Rise of the side hustle For Canadians who lost their jobs during the pandemic, armed with nothing but time on their hands, some seized the opportunity to turn their passions into independent moneymakers. According to Statistics Canada, the number of new business openings across Canada exceeded the number of businesses closing between July 2020 and March 2021 — by a difference of over 10,000 businesses.
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Article content Etsy Canada also reported a 425 per cent increase in new shop openings during the first quarter of 2021 compared to 2020, as well as a 171 per cent increase in 2020 compared to 2019. For some, the side hustle was a means of survival; for others, an unexpected chance to finally invest in a passion without the risk of losing it all. Photo by Daniel Acker/Bloomberg files Angelica Martinez, 21, said the pandemic revived her love of baking. “I’ve always had a passion for baking,” she said. “When the pandemic happened it gave me a little more time.” She started baking cookies, pastries and Filipino breads with her mom for her family. Unexpectedly, her hobby became a business when prospective customers began to take note of photos of her baked goods on her social media and messaged her, asking if she would take orders. “In the first two months alone, we sold over 2,000 cookies,” she said.
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Article content A 10-week internship with Amazon in May forced her and her mother to temporarily cap the number of orders. But Angelica says she is determined to keep the business going, even if it means cutting back on her other jobs. “Something will give,” she said. “But it won’t be the business.” Most side hustles won’t become “full time,” said Andrew Au, a workplace culture expert in Toronto, but the dramatic spike in them will pressure employers to offer flexibility to prospective talent, even balance schedules alongside employees’ secondary sources of incomes. For individuals, it opens up another means by which they might conflate their personal and professional interests. “We will work longer hours, but we will get to redefine what work means to us,” Au said.
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Article content Flexibility may not be the ‘silver bullet’ Despite the surge in demand for more control over the workplace, experts have warned that flexibility may not be the “silver bullet” to put a stop to the 11-hour grind. It depends, they say, on the individual’s ability to manage their own time well and whether the organizational culture can shift. “Flexibility can allow competing roles in life to exist in harmony with each other,” said Lapierre. But “greater flexibility says nothing about the hours that have to be put in one role versus the other.” Data released by Statistics Canada in April found that 34 per cent of workers who began working from home during the pandemic reported working longer hours than at the office. The number jumped to 47 per cent among surveyed workers who said they were more productive working at home.
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Article content All of which means the offer of flexibility alone will not be the key that ends traditional hustle culture. Rather, it must be accompanied by a string of measures in the post-pandemic workplace. “The employer has to make the employee feel that they can exercise these rights,” said Au. “The employee has to have the personal discipline to be able to follow their own personal routines.” I think we will be working more. But it’ll be work we enjoy Andrew Au Companies can introduce a variety of retrofits, new routines that help remote workers fit in with the office. Feedback loops, praise functions — “that helps create trust in organizations where you can’t see people,” Au said. “If people don’t feel trust, they don’t feel secure,” he said. For employees, it means being more organized. If an individual was working 11 hours at the office, moving their work home won’t make a difference without any actual changes. “If people are going to be working where they want or when they want, then they have to be structuring their days,” Lapierre said. “They’re not going to have a manager or a colleague or location structuring that for them.”
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BTIG Stick to Their Buy Rating for Etsy By Investing.com
BTIG analyst Marvin Fong maintained a Buy rating on Etsy (NASDAQ: ) on Thursday, setting a price target of $215, which is approximately 16.58% above the present share price of $184.42.
Fong expects Etsy to post earnings per share (EPS) of $1.14 for the third quarter of 2021.
The current consensus among 13 TipRanks analysts is for a Strong Buy rating of shares in Etsy, with an average price target of $221.33.
The analysts price targets range from a high of $270 to a low of $135.
In its latest earnings report, released on 03/31/2021, the company reported a quarterly revenue of $550.65 million and a net profit of $150.64 million. The company’s market cap is $23.44 billion.
According to TipRanks.com, BTIG analyst Marvin Fong is currently ranked with 5 stars on a 0-5 stars ranking scale, with an average return of 31.7% and a 53.95% success rate.
Etsy, Inc. is an online marketplace for buyers and sellers, and operates in the United States, Canada, the United Kingdom, France, Germany and Australia. It mainly focuses on handmade or vintage items and craft supplies that include unique jewelry, on-trend clothing, bags, toys, art, home decor and furniture. In addition, the company offers several services to sellers including payment processing, advertising platform and shipping services.
Etsy to acquire Elo7, Brazil-based marketplace for unique, handmade items
BROOKLYN, N.Y., June 28, 2021 /PRNewswire/ – Etsy, Inc. (NASDAQ: ETSY), which operates two-sided online marketplaces that connect millions of passionate and creative buyers and sellers around the world, has signed a definitive agreement to acquire Elo7, a privately held marketplace for unique, handmade items, ranked as a top 10 ecommerce site in Brazil. Etsy will acquire the business for US$217 million in cash, subject to certain adjustments for Elo7’s working capital, transaction expenses, cash and indebtedness, and reduced by the value of certain equity awards of Etsy to be granted to Elo7 employees in connection with the transaction. Following the closing of the transaction, Elo7 will continue to be headquartered in Sāo Paulo, Brazil and operate as a standalone marketplace run by its existing leadership team.
Considered a leader in ‘custom and made-to-order’ merchandise in Brazil with strong local brand awareness, the Elo7 marketplace connects approximately 1.9 million active buyers with approximately 56,000 active sellers and currently has approximately 8 million items for sale, the majority of which are made to order. Elo7’s marketplace includes items from over 40 retail categories, with more than 50% of gross merchandise sales (GMS) from “special event and life moment” categories such as wedding, baby, home decor, and children’s parties.
Josh Silverman, Etsy, Inc. CEO, commented, “Elo7 is the ‘Etsy of Brazil,’ with a purpose and business model similar to our own. Following our recent agreement to purchase Depop, we’re excited to bring another unique marketplace into the Etsy family. This transaction will establish a foothold for us in Latin America, an underpenetrated ecommerce region where Etsy currently does not have a meaningful customer base. We look forward to welcoming Elo7’s talented leadership team and employees to the Etsy family.”
Compelling Strategic Rationale
Etsy Marketplace M&A Criteria Elo7 is an Ideal Fit Aligns with Etsy’s mission, strategy and values Elo7 shares Etsy’s mission to ‘Keep Commerce
Human’ with a two-sided marketplace strategy
focused on creative microentrepreneurs. Expands Etsy’s TAM in a large and fast-growing
market, category or geography Elo7 is expected to provide Etsy with a local brand
in the fast growing Latin American market, where
ecommerce penetration is <10%; and Brazil is the
largest ecommerce market. The Latin American
ecommerce market is projected to reach
approximately $29 billion in 2021, with a 26%
CAGR forecasted through 2024. Market leadership, with authentic, organic brand
traction Elo7 is the ‘Etsy of Brazil’ known for handmade,
non commoditized items. We believe Elo7 has
ample room to grow and differentiate itself versus
established ecommerce players. Shares Etsy’s two-sided marketplace business
model Elo7 is a peer-to-peer marketplace with a capital-
light business model and anticipated gross margin
profile similar to Etsy’s. Well positioned to benefit from Etsy’s expertise to
accelerate growth and value creation Elo7 is an early stage business that we believe
can leverage Etsy’s proven value creation
roadmap to drive further growth and profitability.
Carlos Curioni, Elo7’s CEO said, “Etsy has always been an inspiration and a reference for us, and we’re excited to continue our growth journey as part of Etsy - a company whose mission and culture so closely match our own. We’re looking forward to leveraging Etsy’s product and marketing expertise to help the Elo7 marketplace, community and team achieve our full potential in Brazil.”
Rachel Glaser, Etsy, Inc. CFO, added, “We’re excited to announce this purchase of Elo7 following our recent announcement of the Depop transaction - two exciting businesses that meet Etsy’s very high bar for use of capital. In addition to job one, which is continuing to drive growth in our core Etsy.com marketplace, we will now focus on integrating Depop and Elo7 into the Etsy family. Reverb, Depop and Elo7 will each continue to be run by their talented and empowered management teams, and we’ll connect key functions across the brands in a way designed to accelerate value creation and make the whole worth more than the sum of its parts.”
Etsy, Inc’s House of Brands Portfolio
Following the close of the acquisition of Elo7 and the recently announced transaction with Depop, Etsy, Inc. will operate four highly differentiated, non-commoditized and loved ecommerce brands: Etsy, Reverb, Depop and Elo7. These businesses all share similar levers of growth to unlock value, including improving search and discovery, building human connections, and making selling and buying easier. The marketplaces will operate independently, while benefiting from shared expertise in product, marketing, technology, and customer support.
Other Transaction Details
In the near term, Elo7’s current run rate for GMS and revenue is expected to be neutral to Etsy’s top-line results and modestly dilutive to adjusted EBITDA margin. The transaction is currently expected to close during the third quarter of 2021, subject to satisfaction of customary closing conditions.
J.P. Morgan Securities LLC served as exclusive financial advisor to Etsy and Deloitte served as due diligence advisors. Fenwick & West LLP and Bronstein, Zilberberg, Chueiri & Potenza Advogados served as legal advisors to Etsy. Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP and KLA Advogados served as legal advisors to Elo7.
*Sources and data:
Elo7 marketplace data is as of December 31, 2020 unless otherwise indicated.
Elo7 ranked #6 ecommerce site in Brazil: Conversion E-commerce Report in Brazil, April 2021. Study analyzes traffic of 217 largest sites in Brazil with a total of 15 categories, supported by third party data including SimilarWeb and SEMRush.
Brazil ecommerce size and forecast: Euromonitor, Wall Street research
LATAM ecommerce <10% of retail and forecasted to grow at 26% CAGR through 2025: Euromonitor, Wall Street research
About Etsy
Etsy, Inc. operates two-sided online marketplaces that connect millions of passionate and creative buyers and sellers around the world. Our primary marketplace, Etsy.com, is the global destination for unique and creative goods. Buyers come to Etsy to be inspired and delighted by items that are crafted and curated by creative entrepreneurs. For sellers, we offer a range of tools and services that address key business needs. In addition, Etsy, Inc. owns Reverb , a leading global online marketplace dedicated to buying and selling new, used, and vintage musical instruments.
Etsy’s mission is to keep commerce human, and we’re committed to using the power of business to strengthen communities and empower people. Our company was founded in 2005 and is headquartered in Brooklyn, New York.
About Elo7
Elo7, with approximately 150 full time employees, was founded in 2008 with the mission of transforming people’s lives through a humanized buying and selling environment that connects and inspires, giving meaning to each transaction carried out. For sellers, Elo7 works to develop the best technologies and offer simple and practical solutions for managing their sales, and for buyers it is focused on delivering an outstanding shopping experience.
Contacts:
Investor Relations Contact:
Etsy, Deb Wasser, Vice President, Investor Relations and ESG Engagement: [email protected]
or
Etsy, Gabe Ratcliff, Director, Investor Relations: [email protected]
Media Relations Contact:
Etsy, Kelly Clausen, Senior Director, Corporate Communications
[email protected]
Cautionary Statement Regarding Forward-Looking Statements
This press release (including statements quoted in this press release) contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements include statements related to our potential addressable market, the potential benefits of the acquisition of Elo7, expected impact of the acquisition of Elo7 on Etsy’s future financial performance and the potential impact on Etsy’s consolidated financial results, the anticipated timing of the closing of the acquisition of Elo7, the anticipated impact of applying Etsy’s expertise to Elo7’s business and the potential of Elo7’s business.
Forward-looking statements include all statements that are not historical fact. Forward-looking statements involve substantial risks and uncertainties that may cause actual results to differ materially from those we expect. These risks and uncertainties include, among others, the possibility that the conditions to the closing of the acquisition of Elo7 may not be satisfied or waived or that other events may cause the acquisition to not be completed, the potential impact to the business of Elo7 or Elo7’s relationships with its marketplace community due to the announcement of the acquisition, Etsy’s ability to successfully integrate the acquisition and execute on its business plan and “house of brands”' operating model, and general economic conditions and political, regulatory, economic and social conditions in Brazil and Latin America, many of which are beyond Etsy’s control, and other risks and uncertainties that are more fully described in Etsy’s filings with the Securities and Exchange Commission, including in the section entitled “Risk Factors” in Etsy’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2021 and subsequent reports that Etsy files with the Securities and Exchange Commission. In light of such risks, readers are cautioned not to place undue reliance on such forward-looking statements.
Forward-looking statements represent Etsy’s beliefs and assumptions only as of the date of this press release. Etsy disclaims any obligation to update forward-looking statements, except as required by law.
SOURCE Etsy, Inc.
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