Etsy is betting on the Latin American market with the acquisition of Brazilian online marketplace Elo7.
The $217 million deal will help Etsy access the $29 billion eCommerce market in Latin America, which is expected to grow at a 26 percent annual rate — higher than the U.S. In Latin America, eCommerce penetration is currently less than 10 percent, according to market research firm Euromonitor.
Elo7, which Etsy’s CEO Josh Silverman refers to as the “Etsy of Brazil,” enables some 56,000 online sellers to sell products directly to its nearly 2 million shoppers. The company is currently the largest online marketplace in the country.
“Brazil is one of the biggest economies in the world, but its e-commerce sector is still in just the early days of penetration, so we think e-commerce is really poised for growth in Brazil,” he said. “It’s really well positioned, we think, to capitalize on it, so we think it’s a perfect marriage.”
Etsy’s acquisition of Elo7 comes just weeks after the company announced its plans to acquire vintage fashion resale marketplace Depop in a $1.6 billion deal.
The two acquisitions are expected to help the company grow over the medium and long term and help offset the slowdown in U.S. sales as more shoppers return to shopping in physical stores.