Etsy is purchasing the fashion resale iphone app Depop for $1.6 billion.

Depop, the style resale marketplace much loved by Generation Z, can be obtained by Etsy for $1.6 billion, both companies announced on Wednesday.

The money deal, which is expected to close by the 3rd quarter of this year, underscores the growing influence of clothing resale platforms. More buyers are embracing the secondhand market for something cheaper and - possibly - greener as the overproduction of clothes increasingly increases landfills.

The trend appears to have been accelerated by the pandemic as considerably more shoppers seemed to declutter wardrobes, earn cash by selling their old clothes or setup fashion customization businesses from their bedrooms.

Investor appetite can be increasing. Last month, Europe’s major secondhand fashion industry, Vinted, brought up 250 million euros in a funding round that valued the start-up at €3.5 billion ($4.26 billion), while in the United States corporations such as for example ThredUp and Poshmark have gone public this season.

Depop, that was founded in 2011, has been particularly successful found in creating a marketplace for more youthful consumers, who also are adopting secondhand manner faster than any other group. Ninety percent of its users are under 26, with 30 million users across 150 countries. The platform is specially known because of its vintage clothing and streetwear - and for creating a fresh cohort of on the net influencers well-known for selling their wares.

“We are simply just thrilled to be adding Depop - what we believe to be the resale residence for Gen Z consumers - to the Etsy family,” said the Etsy leader, Josh Silverman.

He said he believed the system had “significant probable to further level” and said that he saw “significant opportunities for shared skills and expansion synergies” for Etsy’s clothing sector, which was valued at $1 billion this past year.

In line with the Boston Consulting Group, the global industry for pre-owned apparel will probably be worth up to $40 billion a year - about 2 percent of the total apparel market. It really is expected to develop 15 to 20 percent annually for another five years.

The transaction is likely to close in the third quarter of 2021, subject to antitrust reviews in Britain and the United States.