BROOKLYN, N.Y., Aug. 15, 2019 /PRNewswire/ -- Etsy, Inc. (NASDAQ: ETSY), the global marketplace for unique and creative goods, has completed its acquisition of Reverb Holdings, Inc., a privately held marketplace for new, used and vintage music gear for $275 million in cash, subject to certain adjustments with respect to cash, debt, working capital, transaction expenses and the value of equity awards granted in connection with the transaction.
Josh Silverman, Chief Executive Officer of Etsy, commented, "We are excited to officially welcome Reverb's employees and the entire Reverb community to Etsy. We see significant potential in the Reverb marketplace and look forward to supporting them as they enable more and more music lovers around the world to buy, sell, connect, and learn. It is our goal to unlock further value in what is already a strong and vibrant business with key competitive differentiation."
Etsy Is Acquiring Music Instrument Marketplace Reverb
Reverb is a leading online marketplace dedicated to buying and selling new, used, and vintage musical instruments. Since launching in 2013, Reverb has grown into a vibrant community of buyers and sellers all over the world. By focusing on inspiring content, price transparency, musician-focused, eCommerce tools, a music-savvy customer service team, and more, Reverb has created an online destination where the global music community can connect over the perfect piece of music gear. A portion of each sale on Reverb goes to Reverb Gives, which provides youth music programs all over the world with the instruments they need to make music.
BROOKLYN, N.Y., July 22, 2019 /PRNewswire/ -- Etsy, Inc. (NASDAQ: ETSY), the global marketplace for unique and creative goods, has signed a definitive agreement to acquire Reverb Holdings, Inc., a privately held marketplace for new, used and vintage music gear for $275 million in cash, subject to certain adjustments with respect to cash, debt, working capital, transaction expenses and the value of equity awards granted in connection with the transaction. Reverb, which will operate as a standalone business when the deal closes, was founded in Chicago in 2013 on the principle that buying musical instruments should be easy and affordable. Reverb's sellers are generally individuals, brick and mortar retailers, dealers of all sizes, and high-profile artists.
The music gear industry is unique in that items are often bought and resold, numerous times. Traditionally, musicians only had access to instruments they could find locally or on resale websites that weren't tailored to the music industry. Similarly, musical instrument retailers were often limited to regional customers and musicians had fewer options for reselling used gear. Reverb has created a destination for the global music community to come together online. This gives sellers a global audience and musicians around the world access to more inventory and rare, highly-coveted items. The result is a liquid marketplace that fosters a loyal and passionate user base. In fact, many Reverb users are both buyers and sellers.
Josh Silverman, Etsy, Inc. CEO, commented, "Vibrant two-sided marketplaces are lightning in a bottle - there are only a handful of them operating at scale - and Reverb is one. This transaction is a great strategic fit that firmly aligns with our mission of keeping commerce human. Reverb is the 'Etsy' of musical instruments, with significant competitive advantages, and we see tremendous value and untapped potential in the business."
David Kalt, Reverb's founder and CEO said, "In a short amount of time, we've built a community that musicians from all walks of life turn to for income to support their families, inspiration to fuel their passions, instruments to create new music, and so much more. We're excited to continue growing our marketplace, team, and community as part of Etsy. We've always found inspiration in Etsy. In fact, the company gave me the confidence to launch Reverb when I saw the need for a musician's marketplace in 2013. We're excited to align ourselves with a marketplace that has been supporting artists, makers, and creative entrepreneurs for nearly 15 years. Together, we'll continue to create a destination online where the music industry connects over the perfect piece of gear." Kalt has decided this is the right time for him to make a transition, and will continue to serve as CEO until Etsy identifies a new leader of the business. He will remain closely involved to provide leadership and support following the closing.
The transaction will allow Etsy to enter a new vertical industry with a company that has a similar strategy and business model. Reverb offers a variety of musical instruments that are sold direct and often as resold, used equipment. Reverb has built a strong, known brand amongst instrument buyers and has been growing rapidly since its inception in 2012.
I think the real trends to watch are how investors are valuing areas of musical instruments, and just a importantly, where value in the communications chain may lie. Facebook at the moment is poised to dominate musical life and the business transactions around it, from artists posting Instagram pics to Facebook Groups to its own marketplace. That includes intangible value (artist buzz) and tangible (if you buy a used synth directly through Facebook, which is possible already).
Reverb.com is an online marketplace for new, used, and vintage music gear. It was founded in 2013 by David Kalt, shortly after he purchased the musical instrument store Chicago Music Exchange and became frustrated with then-available options for buying and selling guitars online.[1] It has grown into a multimillion-dollar business[1] with more than 10 million monthly visitors[2] and $47 million in funding.[3]
It allows anyone to create free listings for musical instruments and other related equipment. It has also sold gear from popular artists such as Maroon 5,[4] Wilco,[5] Green Day,[6] Billy Corgan[7] and Ray Lamontagne.[8] It has about half a million listings of music-related gear.
To help users determine market values for instruments, Reverb.com has a price guide of real-time transactional data. It offers iPhone and Android apps that include the site's main features, and as of 2017 has on-the-ground support in the UK, The Netherlands, Australia, Germany, France and Japan.[9] In late 2017, it launched Reverb LP,[10] an online marketplace for LPs and other physical music; and the Reverb Foundation,[11] with non-profit supporting programs and initiatives to increase access to music education, gear, and playing opportunities.
Another factor in the company's success is that roughly 85 percent of employees are musicians.[20] Dave Depper, touring guitarist for Death Cab for Cutie, said, "My experience has been 100 percent positive. You can just tell it's run by people who are musicians or who care about musicians' experience."[20] Depper also cited the website's community feel as a positive, and that he is able to buy an instrument before a tour and sell it for about the same price after.
In 2019, Etsy acquired music equipment marketplace Reverb for $275 million. In 2021, it acquired clothing reseller Depop for $1.63 billion, its largest acquisition to date, which mirrors Etsy in some respects with its vintage community.
The publicly traded e-commerce website has acquired online music marketplace Reverb for $275 million. The former company focuses primarily on the sale of handmade and vintage items as well as craft supplies.
In six years, the online music marketplace has reportedly raised $47 million. Investors have included Groupon co-founders Eric Lefkofsky and Brad Keywell, PayPal co-founder Max Levchin, Silicon Valley venture capitalist Roger McNamee, and Boston-based Summit Partners.
Reverb is an online commercial marketplace where customers can purchase new, utilized, and vintage music-related items. It was established in 2013 by businessperson David Kalt and has developed into a multimillion-dollar business since then.
Buyer interaction on Reverb is also similar to other marketplaces. Using the search bar, buyers can find different sellers or stores for the music items they want. Therefore, it depends on how well you optimize your listings to reach more customers on this channel.
Reverb music marketplace keeps 8.19% of your revenue which consists of 5% for the selling fee, and 3.19% + $0.49 for the payment processing fee. Nevertheless, you are subjected to a minimum of $0.50 and a maximum of $500 for the listing fee.
If you are selling musical instruments, the Reverb marketplace is an ideal destination to land your business. Unlike other massive marketplaces like eBay or Amazon where people sell all kinds of things, Reverb is a music-focused channel that only allows the selling of musical instruments. With such a reputation, you can reach more product-fit customers and eventually achieve a higher conversion rate. 2ff7e9595c
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