An Etsy marketplace is set up in Times Square outside the NASDAQ to commemorate the Etsy initial … [+]
Etsy, the online marketplace best known for homemade goods, has struggled to pay some sellers on the platform, according to a new statement from the company. The payment issues are a direct result of the collapse on Friday of Silicon Valley Bank, which includes a number of tech startups as clients.
“At Etsy, supporting our sellers is our highest priority, and we understand how important it is for these small businesses to be able to receive their funds when they need them,” an Etsy spokesperson told me via email on Saturday.
“We recently experienced a delay in issuing payments to some sellers related to the unexpected collapse of Silicon Valley Bank. Our teams have been working around the clock to implement a solution, and we expect to pay sellers via our other payment partners within the next several business days,” the statement continued.
Etsy posted a similar statement to its website on Saturday in an effort to let sellers know it’s working on the problem.
Silicon Valley Bank collapsed on Friday after a traditional run on the bank was started by billionaire Peter Thiel, who reportedly got all his money out before the bank was taken over by the federal government. The Federal Deposit Insurance Corporation (FDIC) was founded in the 1930s after bank failures in 1929 kicked off the Great Depression and that same program will now be in charge of trying to administer services to SVB’s customers.
It’s not immediately clear whether any of SVB’s other customers have experienced payment delays similar to Etsy, though it’s important to note that some of the companies reported on social media to have been clients don’t actually bank with SVB. Airbnb, as one example, no longer has an account with SVB, as CEO Brian Chesky noted on Twitter.
“We haven’t had money in SVB in perhaps 6 or 8 years,” Chesky tweeted on Saturday.
“This is an issue that is disproportionately affecting smaller (more vulnerable) companies, which makes the situation all the more tragic,” Chesky continued.
Source: https://www.forbes.com/sites/mattnovak/2023/03/11/etsy-struggles-to-pay-sellers-after-collapse-of-silicon-valley-bank/