Etsy, Inc. (ETSY) Evercore ISI 2nd Annual Technology, Media & Telcom Conference 2022 Call Transcript

Q – Shweta Khajuria

Okay. Thank you, Deb. Well, I will ask questions for probably the first several minutes and then for the last 5 minutes or so, I will open it up to the audience, if you want to ask a question. If you do, please raise your hand and we will have the mic brought to you.

Okay. With that, let’s get started. Josh, so Etsy is now about 2.5x bigger on a GMS basis than it was pre-COVID around 2019 time period. And clearly, Etsy has benefited from COVID from the pull forward. And as you say, the agility of the platform really came through when things were available on Etsy and those things weren’t elsewhere. So I guess when you say that you are retaining most of these gains, what are you referring to and second is, what specifically is enabling Etsy to retain these gains?

Josh Silverman

Yes. So first, thanks very much for having me. Really appreciate it. Nice to see you all. When COVID hit, obviously, there were very few places you could shop online or off and the government was funneling money into people’s pockets at a pretty heavy rate. And as a result, Etsy was almost uniquely well positioned to benefit and we did. And so to put some perspective on it, in the quarter before COVID hit, Etsy had 46 million active buyers. And in two quarters ago, at the end of 2021, we had 90 million active buyers. So active buyers doubled and GMS grew by more than 2.5x. If you had asked us in the middle of that, let’s say, late 2020, how much of this will we retain, we’d say, gosh, once the world reopens, if we retain half of that, we would be delighted. And I think that was the conversation is will you retain zero of this or will you retain 10% or 30%? How much of this is just because there is masks on Etsy? How much of this is because Amazon has huge shipping delays and can’t keep things in stock every mall in America is closed? Those were all very fair questions.

And if you look at our guidance in 2020 and even 2021, clearly 2020, we also thought we would lose half or more of the gains. Every quarter, we were giving guidance and then we were blowing past it, not because we were trying to be conservative. We just thought the moment people can avail themselves of other options, they will. And in the beginning of this year, it feels like at least the U.S. and the UK woke up and decided they have had it with COVID, they are done with it and all of a sudden started to travel again, spend in offline malls and all sorts of other things. And yet, we have retained almost all the shoppers and almost all the spend on Etsy. And so we reported 88 million active buyers in the most recent quarter, that’s down from 90 million two quarters ago, but it’s up a lot from 46 million. It is the vast majority of the additional buyers, although masks are not a thing anymore and you can buy anything anywhere and it’s going to arrive on time, there is no supply chain challenges of any scale right now. And we reported that if you look at the people that were active in the second quarter of 2022 and how much they bought and compare that to active buyers in the second quarter of 2021, GMS per active buyer is actually up slightly. So even though people have more options, almost all of them are choosing to come back and shop on Etsy and they are spending as much or more on average as they were before.

When you look at then the guide, what we guided to for the third quarter is that we would lose to your point of keeping almost all the gains and how should you think about it, GMS being down in the kind of mid single-digit range versus the same level a year ago when we had so many tailwinds. And that’s in the face of us no longer having the COVID tailwinds, inflationary pressures of war and a lot of other macroeconomic concerns. So we are really pleased with – and I think the reason is in 2020 and 2021, people felt that they had to shop on Etsy, because they had no other choice. But time and again, they were delighted by what they found on Etsy. And our experience is different. The kinds of products you can buy on Etsy are delightful. The way that the sellers take care of you is different and delightful. I think people had a really great experience and they are choosing to come back again and again and we feel great about that.

Shweta Khajuria

So the reason that you are able to retain these is because of the product experience, the user experience, the seller experience has been unique and in addition to the products that you offer?

Josh Silverman

I believe so. I mean there is no amount of marketing that can carry a mediocre product experience, customer experience, right. So the most important thing is that those people that bought on Etsy really like the experience and are coming back for more. It is also true that Etsy’s brand awareness is in a different place than it was before. In 2019, I would introduce myself as hi, I am Josh Silverman. I work for a company called Etsy. We are a two-sided marketplace with artisans. Now people look at me like, what, are you crazy? Of course, I know what Etsy is. We did a family holiday in Turkey just a month ago and someone asked what I do. I worked for Etsy, it’s this company, blah, blah. We know all about it here in Turkey. You do? We don’t spend a penny marketing in Turkey. But our brand awareness is just in a different place. And I think that is also helpful. We are starting to be more front of mind for people when they think about shopping generally.

Shweta Khajuria

Yes. Okay. You touched on guidance a little bit, so double down on it. What are some of the assumptions that you and Rachel and the team accounted for when you provided your guidance? And there are some Tier 1s, but there are also some headwinds that you already talked to, including you mentioned that you saw some leveling off of the deceleration in GMS growth in June and July. So perhaps, could you talk about the assumptions that you have accounted for and why you thought or why you think you saw that leveling off?

Josh Silverman

Yes. So we continue to think that the best way to think about forecasting our business for now is a 3-year stack compared to the same period in 2019. And I know you are sick of hearing about 2-year stacks and 3-year stacks, but we have found that to be the best way to think about our business. So in the second quarter of 2022, how much what was our GMS compared to that same period pre-pandemic? And what we have seen and we actually included in our second quarter earnings call month by month how that 3-year stack has trended, because we think it is so important as we think about guidance that we thought you would also be interested in seeing those trends on a monthly basis. And what you will see, if you go back and look at that earnings call is we had stayed at around 200% growth for 2021 and all the way into January of 2022 that means we are about 3x bigger than the same period in pre-pandemic. Then all of a sudden, in February and March and April, we saw a very steep deceleration in our 3-year growth rate. It felt like a light switch turned in kind of mid to late January. People decided they have had it with COVID and I am going to shop offline, I am going to travel, I am going to eat out in dining and e-commerce generally and certainly Etsy felt some of that. And so we went from about a 200% growth rate to, call it, 150% growth rate over that 4-month period. Then we saw in May and June, what began a leveling out going from, let’s say, 150% to only 140% growth. So, the rate of deceleration slowed quite significantly and we even included the dot for July, which we had almost finished by the time we did the earnings call, right.

And what you see is a trend line where there is a pretty steep decel, Feb, March, April and then that much slower decel in May, June and July. What we don’t know is have we hit bottom? But to pull out of the numbers and to put this into human context, there was this very narrow window where people could spend money for a long time. Etsy was one of the only places you could spend your money. So, the wallet was unnaturally constrained to our benefit. All of a sudden, the constraints are off. You can spend money anywhere. And it feels like people will naturally rebalance their wallet. They might even over-index on travel and dining out, because they haven’t done that for a while, right. But it feels like once you give people choice, they are going to avail themselves to that choice that will come, to some extent, to Etsy’s detriment and then we will hit a new normal. And from that new normal, we think we will grow again.

So the question is when are we at that new normal? That’s the $13 billion question or whatever our market cap is today. And so what we are indicating is it feels like we maybe approaching. And our guidance accounted for that. So if you look at the third quarter guidance, we drew the lines for you. At the high-end of guidance, there is very little decel on a 3-year basis. We have almost felt the full impact of reopening. And at the low end of guidance, we are continuing to see some decel. We don’t know. We have no crystal ball. So we are giving you the same information that we have and each of us will make their own guess as to where we are in terms of sort of returning to normalcy in terms of consumer spending, but it’s my belief that we will hit a level where consumers are back to the new normal and from there we will be growing again.

Shweta Khajuria

That makes sense. I guess at a high level before I get to margins, but at a high level, what are you seeing and how are you thinking about consumer demand for retail in general? The sustainability of demand, on one hand, savings rates are high. People still have jobs. They are willing to spend. We are entering Q4 here shortly. And on the other hand, there is Europe where perhaps there is more headwinds, there is recessionary pressure and there are inflationary pressures. So at a high level, how are you thinking about where consumer demand can go not only quarter-to-quarter or month-to-month, but in general, over the next, call it, one to four quarters?

Josh Silverman

Yes. So there is all the headwinds you mentioned, right, inflation and war and everything you are all very well aware of. And I would add to that, that you might consider Etsy to be unusually discretionary, right. And so we might be one of the hardest hit by those. I say we might be, because we honestly don’t know. We haven’t had a recession in some time and Etsy is only 14 years old. And so it’s kind of amazing to say that Etsy wasn’t old enough during the last recession to really know how we react in a recession. Hopefully, we won’t find out soon. We don’t know if we are in a recession, but we may. And yet, our numbers have been holding up. We think pretty okay relative to e-commerce as of the last time we reported. And I think our guidance also accounts for a range of what’s going to happen with consumer discretionary spend.

A couple of tailwinds or things, I would point to in our favor is that there is an incredible breadth of inventory on Etsy and it’s all the things you need for daily life. So people can learn that if I am going to need to buy new flat wear, I can go and buy it on Amazon or I can get it at West Elm, but Etsy has stuff that’s great and beautiful that’s made just for me and is at a very fair price. And so all those small luxuries, the lipstick effect, right, I can’t afford to take a trip to France right now, so I am going to treat myself with something small. Etsy has lots of those small delights. And also lots of things you need for daily living. It turns out that you can buy on Etsy as well, and they are affordably priced. So what you’ll see in our marketing campaigns that we’re launching just now is us talking about value and affordability more than we ever have, because our sellers do a great job. And unlike so much of the rest of the market, they have chosen not to take price over the past 5 years. So Etsy sellers on average have raised their price by about 8% over the past 5 years cumulatively and have given back about 8% in price in the form of discounting to consumers with the result that their actual price is flat, meaning relative to the market, the value on Etsy has gotten better and better.

Shweta Khajuria

Despite the inflation.

Josh Silverman

Despite inflation or in the face of inflation, the value proposition of Etsy is getting better, maybe our sellers should be taking more price. And there is probably an opportunity for us to invest more in tools to help them. They set their prices, we don’t. But there may be an opportunity for us to help coach them on how to set better pricing. But in the meantime, there is a lot of great value on Etsy. There has always been and continues to be a lot of great value on Etsy, and we’re going to do a lot to make sure that the market knows about that.

The last point I’ll make on this is, unlike so many people, we don’t have to make billion-dollar bets on what’s going to happen with the market. If you’re almost anyone in retail, this is a very high stake question, right? I’m buying inventory. I’m building up my warehouse staff. I’m doing all the other things, betting on whether the holiday season is big or not. Etsy is a very capital-light model. We will discover in December what the holiday season is like. But our – we are very agile in terms of making a lot of our investments come in the form of performance marketing, which go naturally with demand.

Shweta Khajuria

Makes sense. Sticking with guidance and margins so the core business is over 30% EBITDA margin, very healthy. It’s the subsidiaries that are dilutive to EBITDA margins. At a high level, when you think about managing the business for growth and margins, how are you managing that and how should investors think about that?

Josh Silverman

Yes. Great question. So yes, you’re right. We guided to about a 26% consolidated margin, and we said that the subsidiaries have been about a 400 basis point headwind, give or take, to margins, so you can consider that the guidance implies about a 30% margin for the core. And that’s healthy. We said years ago, in 2018, that we thought that someday we could be a 30% margin business. We got there faster than we thought. We were above 30% for a lot of the pandemic. We have never been a growth at all cost company. We have always believed in discipline around investments. And so when growth exploded in the pandemic, we did not throw caution to the wind and then start spending like drunken sailors. We’ve always thought about what’s the return on the next dollar spent. And margins were higher than we would have liked because we couldn’t responsibly invest that much more money that quickly, and we weren’t going to waste money. But it is ultimately growth that matters.

And when we can invest a dollar that earn something substantially more than $1, we do it. We do it. We do not wake up every day saying, here’s a margin target, let’s hit that margin target. We wake up every day saying, is there an opportunity to invest another dollar to grow more, because it’s what our sellers want, it’s what our shareholders want, it’s what we want. And so we are constantly looking at other new marketing channels that we can find that will allow us to invest, to bring more customers, to have those customers come more often in a positive ROI. If we hire five more squads, do we have productive work to put them on that we believe has a very high likelihood of generating more GMS. And we use that lens for every investment that we make. And when we think there is an opportunity to invest more, to get more, we do it. We try to do it responsibly. Hiring is something which doubling the size of a team in a year, I’ve been parts of organizations that have done it, and it doesn’t end well.

So we’ve scaled our – well, we have a lot of great ideas that we believe can really unlock more growth. There is only a certain pace at which it makes sense to hire. And we’ve hired a fair bit over the past 2.5 years, and at what we think is a responsible cadence, and we said that we’re slowing our pace to hiring. We didn’t freeze hiring, but we’re slowing our pace of hiring because we have grown a fair bit. And making sure that everyone is well seated that everyone is clear on their missions that are – the structure is right. These are things you’re always tweaking and tuning. We think this is a good moment to catch our breath a little, make sure everyone’s well seated and invest. But we want to keep scaling the team and we want to keep scaling marketing, doing it in a way that we have confidence is going to drive profitable growth in the future.

Shweta Khajuria

And are you seeing as good of opportunities today?

Josh Silverman

Yes. So it’s probably true that there was overinvestment in e-commerce for the past, pick your number, 5 years, 10 years. We’ve been saying for a very long time. I think it’s exceptionally unlikely that there is going to be tens of thousands of standalone e-commerce brands out there. It just doesn’t make sense, because people can’t remember 10,000 brands. So almost all of those brands have to be downstream of Google or Facebook, and that’s where then all of the rent is going to go, right? They can only remember a handful of brands. I think we’re going to see a reckoning. Now we’re going to have a lot less of that investment. And that’s going to mean that marketing is going to become a little more affordable. The talent market is going to become more affordable. I am old enough to have been running a business in 2000 when every Internet company was getting infinite amounts of money, and actually 2002, 2003, 2004, 2005 were some of the best times to be building Internet companies. Maybe we’re on the cusp of something like that over the next few years. And I think that’s going to bode very well for Etsy. We have been investing in brand most of our traffic. About 80% of our sales come unpaid. We are not reliant on Google and Facebook for the majority of our traffic. And we think continuing to invest to be one of the few destinations you remember is a huge prize for us.

Shweta Khajuria

Makes sense. Okay. Moving to buyer purchase frequency and product development, so you’ve said this before, you aspire to be the starting point of e-commerce for consumers. That’s where you want to be. And since you joined Etsy, I mean, everyone knows what has happened, you’ve transformed in a lot of ways. And a debate around product development is when we look at purchase frequency, that has really grown really well and has the low-hanging fruit been met because you’ve already made so many product changes to developing the product to where it is today. And if not, I’m guessing the answer will be no. Where do you see the most opportunity and how should we think about the growth trajectory of purchase frequency?

Josh Silverman

I think the first time I got this question was in my fourth quarter running the business. And every quarter since, I’ve gotten that question. And we keep, I think, doing very substantial improvements to the business to make it better. And I’m still hopefully all of you shop on Etsy. If you’re interested enough to take half an hour of your time to be in this room, hopefully you shop on Etsy. And I think if you do, you’ll find that the customer experience is pretty great. Like the products are unusually good, the prices are fair and the sellers really work hard to take great care of you. And I think you’ll find that it’s not too hard to find what you’re looking for. There is an overwhelming amount of selection. You’re still nervous, is it going to arrive on time? What if I don’t like it? All of the sort of post-purchase things can get a lot better, and the number of I should have had a V8 moments. The number of times you bought somewhere else and then realized, I actually could have bought that on Etsy, is still far too high.

We have enormous opportunities across all of those. Let me talk just briefly about efficiency, inspiration and reliability. Efficiency, when you know what you want and you come to Etsy, you know what you want, you go to Amazon, you’re going to get there in 4 seconds. You can get in and get out in 2 minutes, right? It’s not that way yet on Etsy. There is too much stuff. It’s overwhelming. And it takes a little bit still too much to get there. So the friction of it’s going to be a 7 or 8-minute experience to go buy this on Etsy, I’ll just go to Amazon, still a lot of opportunity there. Inspiration, I don’t think a ton of people go to Amazon just for fun. But people go to Etsy just for fun all the time. And we don’t do nearly enough with that. So the opportunity to inspire people with things like our explore feed right now, just continuous streams of videos of sellers making stuff that just engage you and engross you, and also expose you to all the different things you can buy on Etsy that you didn’t realize you could buy is a big opportunity.

And then reliability, removing that nagging fear of what if it doesn’t arrive on time, or what if I don’t like it, or what if it comes damaged, things like Etsy Purchase Protection. We just launched Etsy Purchase Protection. Other e-commerce sites have had that for a decade, right? So we still have very significant opportunities to get better in each of these areas on efficiency. By the way, one thing I’ll talk about, we’ve worked hard to make our search algorithm a lot better. Now just in the last 6 months, we run multiple search engines all at the same time. And we can give them multiple objective functions, meaning I want the item that’s most relevant for this person and that ships the fastest to this person and solve for both of those at the same time. That’s something that we couldn’t have done before. So really significant improvements in search and discovery and reliability.

And then last, but certainly not least, one of the biggest challenges for us for frequency is just we’re not top of mind still, people now in the U.S. and the UK, less so in the rest of the world, but in the U.S. and the UK, they generally know Etsy, and they generally think very good things about Etsy. I love Etsy. It’s awesome. Show me the last 90 things you bought online and how many of those came from Etsy. I didn’t think about it. I’m sending my kids back to school. Of course, that would be a great place for school supplies and backpacks. It was my mom’s birthday, I forgot to buy her the thing from Etsy. Halloween is coming up. Of course, Etsy is the right place for Halloween costumes, and on and on and on. It’s mostly that they just didn’t think of us. And so if you look at this TV campaign we’re just launching right now, you’ll see that it’s a lot of shoulder tap. It’s a lot of just reminding people. We don’t need to do anything more than just Etsy Halloween, like, yes, of course, Etsy – we don’t need to do it, two-sentence long explanation, right? It’s just that shoulder tap of all the different things you can buy on Etsy, and people like, yes, I get it. And the other hook in this campaign is value and affordability, which we think is an important message right now.

Shweta Khajuria

So of efficiency, which is search and discovery, inspiration, which is these videos or other product changes; and reliability, which is the protection program, of these three, which do you think has the most meaningful impact? Or where do you think there is biggest room for showing…

Josh Silverman

For improvement?

Shweta Khajuria

Yes.

Josh Silverman

Alright. That’s hard for me to say. And I wouldn’t say that discovery is just the explorer feed or reliability is just purchase protection, in no particular order. On reliability, we have made massive gains in getting the items to arrive within the timeframe that the seller promises. Like many, many percentage point improvements in that over the past 18 months. So, we are never going to be the place where everything arrives in two days. That’s not us. Most often, when you order something on Etsy, the seller then makes it for you made to order. So, that’s why warehousing is unlikely to be a big deal for us because most items are made just for you when you order them. So, we don’t have lots. Our sellers don’t have large amounts of inventory ready to be sitting on a shelf. That means we don’t have to invest billions of dollars in CapEx, but it does mean that we have got to be very good at setting expectations and meeting expectations. And we have a lot of carrots and sticks with our sellers to make sure that they do that well. They have gotten far, far better at that over the past 18 months with the help of a lot of tools we have been giving them and encouragement we’ve been giving them. So, the customer experience you are getting is very reliable. As we head to the holiday season, that’s even more important right now. Being best in the world at a million point to million point logistics network is a big area of investment for us. So, Amazon and Walmart and others have hundreds of fulfillment centers. They are going from hundreds to millions or maybe they have thousand, I don’t know, thousand to million, but we go from a million to a million. 5 million sellers to 90 million buyers, right. So, we have got to be great at that. And we have been making a lot of investments to get much better at making sure the items arrive on time. In terms of discovery and efficiency, personalization looms very large. And personalization for us is very different than everyone else where items map to a catalog. We have got to understand who you are and what your taste is, and we have got to understand what these 100 million things are, each of which is a snowflake, and then find you the best love match. That’s something that was impossible 10 years ago, that’s become very, very possible now, understanding what is the style of that light fixture and what chair would match it is something that only a human could have done 10 years ago and computers are getting pretty darn good at that problem now. And that’s uniquely helpful at Etsy where we can’t have a catalog that helps us with that problem. So, in terms of things like inspiration, I think there is a huge opportunity ahead around personalization for us. And we only launched the first personalized version of our search engine less than a year ago. That’s how early we are. Every single person in this room would have gotten the same set of search results a year ago if you gave us the same query. Now in real time, we are looking at what is your behavior over the last few mouse clicks, and we are ingesting that to use that to personalize your experience. That’s important because yesterday, you might have been on the site shopping for yourself, and today, you are shopping for your mother. And those are two totally different experiences. And what it takes to take real-time data and use that to personalize as an order of magnitude harder challenge than taking batch processed stuff from a week ago.

Shweta Khajuria

That makes sense. Okay. Moving on to buyer growth, and then I will open it up to take questions from everyone here. Buyer growth, so you have already pointed you have got 90 million-plus buyers, 94 million on a consolidated basis. But given that it is a trailing 12 month, I know you know where this question is going. But given that this is a trailing 12-month buyer count, one of the debate points is when would – could that be a cliff off because you lap that, you have benefited from it? So, what would you tell investors who ask that question to you when you lap that?

Josh Silverman

A couple of things. So, that’s starting to happen already. So, if you look at our Q3 guidance, the comps get tougher, and we are encouraged by the fact that we went from 46 million to 90 million, than we have 90 million to 89 million to 88 million. So, we are holding the vast majority of those buyers. I get it that it’s a trailing 12. So, part of what we did in response to that question in the second quarter was look at GMS per active buyer, which is also trailing 12 metric and get – and share that GMS per active buyer actually was higher in the second quarter of 2022 for just in the three-month period. How many buyers bought in this three months and how much did they spend in this three months. And that number was actually up in Q2 of 2022 versus Q2 of 2021. So, in spite of having a lot more choice, the buyers that are with us are spending even more and we are seeing a small amount of lapsed buyers. It’s been pretty steady. But the vast majority are staying with us. And the other thing I would say about the lapsed buyers is when you go and talk to them, they are not churned. I want to use my words carefully here because churn to me implies they don’t like us. Something went wrong and they are saying, I am never using that Etsy again. I am sure there is a portion of – like for any company, I am sure for Etsy as well, there is a portion of people, but as we go out and talk to Etsy buyers, we find that portion to be very, very small. Most of the lapsed buyers are people who say, I love Etsy and I shop on Etsy all the time. And you say, well, you haven’t shopped there in the last 12 months. Really, oh my gosh, again, I just didn’t think of it. I love Etsy. I think of myself as a loyal and passionate Etsy buyer. In fact, I tell all my friends about Etsy. Oh, well, why didn’t you shop more recently, I guess I just didn’t think of it. That’s what you get a lot. So, one of the things we talked about in the last earnings call is we have a huge number of recently lapsed buyers that we have a big opportunity to go and reengage. And part of the investments we are making in marketing are really around reengaging these buyers who already love Etsy. They just need that shoulder tap and that reminder.

Shweta Khajuria

Makes sense. We have got four minutes left. Any questions from the audience? Going once, going twice. Okay. I will keep going. So, when we think about the buyer cohorts, there are new buyers, there are lapsed buyers and there are habitual buyers. Where do you see – I will go one-by-one. Where do you see opportunity for new buyer growth? Not only you may say you have been in North America for a long time, so in North America as well as abroad.

Josh Silverman

Great. So, in the U.S. and the UK, and actually penetration rates in those two markets are now about the same, about 30% of women and about 10% of men have shopped on Etsy in the last 12 months. That means 70% of women and 90% of men still haven’t. People think of us as a household name. They think we are as big as eBay. eBay is many times bigger than we are in terms of GMS. And so there is still a very big opportunity in the U.S. than the UK. And then as we get outside of the U.S. and the UK, the next 15 markets together have about $20 trillion of GDP. It’s about the GDP of the U.S., and our penetration rate is about 80% lower on those next 15 markets than it is in the U.S. Some of those markets include Germany and France, for example, which are two markets where we are making investments. In Germany, we have been running TV ads for the past 18 months. And our performance in Germany has outpaced that market we think really well. And especially when you consider everything going on in the tragic war in Ukraine, so close to Germany, and the energy crisis that’s happening there and everything else, our business in Germany is holding up quite nicely. And we think that’s because we have been leaning into investing there. That’s a huge market with huge opportunities. And we are starting to see now, and by the way, one of the telltale signs we think of opportunity in a market is what percentage of the trade is domestic, meaning they are importing from usually the U.S. or the UK and they are exporting to usually the U.S. or the UK. But at some point, you get enough import and export business that the people are buying locally. In Germany, more than half of the trade is now local. We think that’s really encouraging and bodes very well for the future there. We think the next markets are also great markets for new buyer acquisition.

Shweta Khajuria

Makes sense. Well, we only have 1.5 minutes left. So, let me ask you, what do you think is most misunderstood about Etsy? What would you like to tell investors that you think may not be the accurate way of looking at it?

Josh Silverman

I think for most things that you buy, there is a great alternative in it. It’s great, it suits your taste and style, and it’s priced fairly and it will arrive in a reasonable amount of time, maybe not in two days, but how many things really have to be there in two days? And I think most investors still think of Etsy as a niche place, but it’s actually a million niches. It’s got a robust assortment of almost everything you want to buy okay we don’t sell iPhone, consumer electronics, not our thing. Most other things you buy are available for sale on Etsy. And we saw that during the pandemic. When you couldn’t go anywhere else, you had to think hard of where can I go, and Etsy was there and did a great job for you. It has been the case for some time that I think people go to Etsy when they can’t find it anywhere else. I think there is an opportunity to flip that narrative and to say it’s a better shopping experience on Etsy. So, why wouldn’t you start on Etsy, why wouldn’t you start your shopping experience on Etsy, there is a lot of things that you don’t care about. You just want it to be fast and cheap. Those are the commodities of your life that come and go and end up in a landfill, and that’s fine. Maybe it’s a bic pen, maybe it’s toilet paper or socks, whatever it is for you. That’s fine. What’s that, we sell lots of socks. You may care about your socks or not care about your socks. If you could care less about your socks, you are going to go buy those on Amazon or Zappos, they are going to arrive in two days, you are going to wear them for a couple of weeks, then throw them away. If you care about your socks, Etsy is the place to go, and you are going to get socks that no one else would have or wear. And that’s going to feel great, and you are going to feel special wearing them. So, more and more, I think people are going to crave an alternative to Amazon. And I think there is no one better positioned than Etsy to be that alternative, and I think that allows us to be a starting point for so many of your shopping missions and the opportunity there is.

End of Q&A

Shweta Khajuria

Alright. Well, we are approaching holiday season. So, if you have not tried Etsy, check it out. Josh Silverman, CEO of Etsy. Thanks so much.