Neal Freiman

I won the pre-show bobsled race.

Toby went way too high into corner three, so I get to go first.

And my Stock of the Week is, well, there are two, Etsy and eBay, who struck a fashion deal that investors think will be a win for both four-letter companies that start with the letter E. Here is that deal.

Etsy sold Depop, a secondhand clothing app, to eBay for $1.2 billion.

By acquiring Depop, eBay is essentially buying young shoppers.

As an online marketplace that's over 30 years old at this point, and you can tell when you go to the website, eBay will use Depop to increase its reach with Gen Z, a group that absolutely loves used clothing.

Of the 7 million buyers on Depop, 90% are younger than 34. eBay stock gained 3% after the deal was announced.

As for Etsy, it's shedding a fast-growing but ultimately distracting part of its portfolio, which is why its stock popped over 9% on the news it was selling Depop.

A couple of years ago, at the height of the pandemic e-commerce boom, Etsy went on a side quest to compete with Amazon.

It aimed to build a so-called house of brands filled with platforms catering to specific customers, so it went on a shopping spree and bought Depop.

a Brazilian e-commerce company, and a musical instrument marketplace it had scooped up in 2019.

Fast forward to today and it's unwound all three of those acquisitions.

Toby, a rare deal that the market actually likes.

It is, but it is curious because they sold it for $1.2 billion, but they paid $1.6 billion for it.

So they sold it at a $400 million loss, and that seems to be par for the course for some of these secondhand companies.

Poshmark was sold to Naver, which is a South Korean company, back in 2023 for $1.6 billion.

That was less than half of its IPO price.

So for whatever reason, this is a growing industry, but some of these companies maybe just haven't figured out the best way to make money from it.

Toby, we all know it's okay that you're afraid of horses.

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