Etsy is acquiring the music instrument marketplace Reverb for $275 million in cash, the company announced on Monday. Chicago-based Reverb sells new, used, and vintage musical instruments and gear and has approximately 170 employees, one million active buyers and 380,000 active sellers around the world.
Etsy said Reverb would continue to operate as a standalone business post-acquisition. However, Etsy plans to pull from its playbook to help Reverb improve site search and discovery and optimize its buying and selling processes as a means to achieve scale.
Meanwhile, Reverb enables Etsy to expand into a new vertical.
Etsy chief executive Josh Silverman pointed to similarities between Etsy and Reverb in terms of growth drivers and said he's confident that Etsy's strategy will have a positive impact on Reverb's business. Etsy has roughly doubled GMS growth, revenue growth, and profit margins since Silverman took over as CEO in 2017.
"Vibrant two-sided marketplaces are lightning in a bottle -- there are only a handful of them operating at scale -- and Reverb is one," said Silverman. "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."