NEW YORK (AFP) - Etsy shares leapt out of the gate on Thursday, more than doubling in price as investors snapped up shares of a company that puts a socially-conscious spin on online auctions.
Etsy shares jumped over US$34 in a stellar debut and settled down just shy of US$32 by mid-day, giving the firm a value of more than US$3.5 billion (S$4.7 billion) based on stock.
Etsy priced its shares at US$16 ahead of its Wall Street debut for the online marketplace known for handicrafts and strong social values.
The IPO raised about US$267 million for the Brooklyn, New York-based firm.
The stock is trading on the Nasdaq market under the symbol "ETSY."
Etsy was founded in 2005 and pegs itself as the "antidote to mass manufacturing" by selling handmade and vintage goods.
Etsy warned in regulatory filings that its devotion to sustainably-created products could hinder its ability to make quick profit.
"I intend to keep our unconventional operating philosophy as we become a public company," chief executive Chad Dickerson said in a letter included with the Etsy regulatory filing.
Etsy plans to maintain its status as "a certified B Corporation," which seeks to contribute to solving social and environmental problems.
It is only the third B corporation to become publicly traded, reflecting a seeming contradiction between social values and responsibility to shareholders.
"Investors want a company to do good, but they don't want too much at the expense of getting the profit they are looking for," says Kathleen Smith at Renaissance Capital, a research firm which specialises in IPOs.
"There could be a little bit of contention between the investors' constituency and social responsibility."
In the past year, Etsy reported a loss of US$15 million as it ramped up marketing efforts. But it has generated sales on the platform of US$1.93 billion, one-third of which came from outside the US market.
Last year, Etsy boosted its international presence with the acquisition of French-based rival, "A Little Market."
Etsy has gained a reputation as a hipster, artisanal version of eBay, featuring a large number of vintage and handmade items. But critics say mass-produced goods from China and counterfeit items make their way onto Etsy despite the company's efforts.
As of Dec 31, Etsy had 1.4 million active sellers and 19.8 million active buyers, with a large number of both coming back to the platform.