Secondhand clothing apps hit a stride during the pandemic as young shoppers sought to make a buck — or a save a buck — by buying or selling used outfits.
At the time, Etsy, the digital marketplace that allows small artisans and designers to reach a mass market of consumers, took note of the trend. And in 2021, Etsy bought Depop, a popular secondhand clothing app, for $1.6 billion as tech valuations soared.
But now Etsy is selling Depop to eBay for $1.2 billion, as it seeks to refocus on its namesake business, the two companies announced on Wednesday.
Depop has attracted a cult following among members of Gen Z — roughly 90 percent of its seven million active buyers are under the age of 34.
Etsy’s Depop acquisition was part of a multiyear spending spree that included the purchase of Reverb, a music gear site, and Elo7, a Brazilian e-commerce site. Since then, Etsy has sold both of those sites for undisclosed amounts.
Etsy has been facing decelerating growth — its year-over-year revenue grew 2.2 percent in 2024, down from 7.1 percent in 2023. Etsy will announce its 2025 earnings on Thursday.
In the face of those headwinds, Etsy is seeking to bolster its core marketplace business.
“We are excited that this transaction allows us to focus exclusively on the compelling opportunity we see in front of us: to grow the Etsy marketplace,” Kruti Patel Goyal, Etsy’s recently appointed chief executive, said in a statement.
Despite its discounted sale price, Depop had been growing. The company reported $1 billion in gross merchandise sales in 2025, and increased its U.S.-based sales 60 percent from the year prior. Etsy plans to use a portion of the proceeds of the sale for share repurchases, which could provide a boost to its shareholders, who have seen its stock fall about 20 percent in the past year.
For eBay, Depop’s popularity with younger users makes it a valuable addition to the 30-year-old company’s marketplace.
Depop gives eBay access to “millennials and Gen Z and young women in particular, which is still an underrepresented demographic for us,” said Jamie Iannone, eBay’s chief executive.
The secondhand apparel market is expected to grow two to three times as fast as the market for new products through 2027, according to a report by McKinsey. On eBay, used product sales are faster growing than new product sales, Mr. Iannone said.
The transaction is expected to close in the second quarter of this year.
Niko Gallogly is a Times reporter, covering business for the DealBook newsletter.
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