Etsy Is Learning To Lobby Congress And It's An Adorable Mess

We don't make or sell anything directly, Senator... but we're somehow worth almost $2B. So can you help us out?
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Everyone's favorite Brooklyn-based online flea market is taking another big boy step in its metamorphosis from crunchy startup to flinty-eyed capitalist overlord.

A group of Etsy executives and company vendors had descended upon Washington and embarked on a campaign to eliminate online sales taxes and exempt small businesses from import and export charges. The trendy online marketplace is on a mission to grow up. And on Capitol Hill, it learned that growing up starts with grip-and-grins before transitioning into policy debates.

That's right, Etsy is lobbying now, and they invited a lucky Washington Post reporter along for the ride. What he saw was a company hell-bent on making its point in time to save its stock price, but doing it in a way that was, like, cute.

Members of the group left their power suits and ties at home, wearing instead craft eyeglass frames and quirky jewelry, snapping photos of the building and plaques in front of offices. One team member had knitted a pillow with the White House on it to celebrate the company’s pilgrimage.

Sounds like a pretty adorable pillow, even if the building on it is kind of the wrong one for a visit to Congress. But Etsy finds itself in a far-from-cute position at the moment, so maybe some closer attention should have been paid to pillow ornamentation.

The stakes for Etsy are big. After its closely watched IPO, its stock is down nearly 40 percent. The money-losing company is trying to convince Wall Street that despite its crunchy image, it can turn a profit in a competitive e-commerce market.

But Etsy has a narrative to sell to members of Congress. It creates small businesses by empowering arts n' crafters to sell their stuff in a way that cuts back on overhead and maximizes profit. Now it just needs to clarify that message to the haircuts in dark suits and get them to pass a law.

That should be easy enough, expect for the fact that Etsy is a very confusing company for members of Congress to get their shiny heads around.

Etsy doesn’t sell anything. It has no product, no goods, no services.

Oh, and also Etsy has no experience doing this sort of thing.

How rough was it to watch Etsy's fledgling attempts at charming a member of Congress into playing ball? A sit-down with Democratic Virginia Senator Mark Warner looked less like a major step into shaping economic policy than like Etsy tripping over its own Crocs at Warner's front door before stumbling the length of his office and out an open window.

Warner voiced approval for Etsy's pro-entrepreneurial idealism, but was also blunt in his concern that Etsy is relying on the work of non-employees to generate its profits, while not creating any kind of safety net for those users.

If those making a living selling crafts through Etsy get sick or hurt, there goes their income. But they are a large enough sector of the economy that Congress should go to bat for them on trade issues, then get out of the way, Etsy officials argued in the meeting with Warner.
That’s a combination that’s tough to have both ways, Warner said. “This is going to be complicated,” he said with a smile.
“Is there anything else you all want to tell me?” he asked as an aide poked her head in and gave a subtle wrap-it-up sign. It was around noon. The meeting had started at 11:30 a.m., with 10 minutes of introductions.
Etsy hadn’t made its pitch for eliminating online sales tax or cutting import and export fees for small businesses. Papers ruffled as Etsy team members flipped through their notebooks. One Etsy team member looked at her watch and slumped in her chair.
“Well, we wanted to mention . . . ” started one vendor, before Warner politely interjected.
Time was up.
“It’s in your literature, right?” Warner asked with a warm smile as heads bobbed around the table. “Well, I think I learned a lot.”
Single file, the Etsy team members exchanged handshakes as they slid out of the meeting, their third of the day.

But at least the company's leaders can learn from these early mistakes and refocus on what it should do for next steps. For instance Etsy's policy director Althea Erickson can take a lot from the missed opportunity with Warner.

What was her takeaway from her time with the Senator?

“That went really well,” Erickson said.

Oh, Etsy.

Etsy is growing up. Here’s why it needs Congress’s help. [WaPo]

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