The world is lateral and open now.
Matt Stinchcomb has a lot of milestones buoying him when I come in to chat with him at Etsy, where he’s been working on all sorts of development initiatives from Day One. For one, it was his birthday just the night previous, and he’s expecting his second child in a couple weeks. For another, in his capacity as the VP of Values and Impact, he’s launched and works on different open source initiatives to afford some 30 million Etsy users the tools of human-scale economy.
Paperhouses: Can you tell me a bit about Etsy's open source initiatives?
There are two things. First, we started something called Code is Craft, maybe four years ago now, and it's our engineering blog where we explain everything we do and share the code for it. We also have lecture series where we bring in engineers from all over the place and it's free and open to public. The idea is to share our practices and tell everybody what we do. We developed what at the time was a pretty unique approach to continuous deployment of code, even if you look at those monitors (gestures to their full-screen analytics video wall in the office), you see when code gets deployed and you'll see thousands of deployments a year. Sometimes you see hundreds a day. It's a cool system I know very little about (laughter), since it's engineering… but the idea was in the spirit of open source software because a lot of Etsy is based on open source software.
I think you have a spirit to that that actually also resonates in the community because there's a lot of people who are openly sharing, like the sellers, openly sharing how they make what they make.
Where's the line you guys draw between know-how and proprietary content.
It's a delicate balance. For one, we're not selling anything ourselves. We open source the work we do, but I think certain businesses on Etsy like to operate that way and openly share what they do. Others are more protective of their IP. We basically just go by the digital millenium copyright act. That's our policy toward copyright protection. I mean it's not a perfect system. But I do think it's an important issue for the sellers on Etsy. Our key is to try to educate. And I actually used to be a screen printer but…
Oh I saw your video with Bre Pettis…
Yeah (laughter) I'm entirely self-taught so I'm not a great but… That video is so great because it's gotten millions of views now and most of the comments are like “those guys are gay” (laughter) or “that is NOT how you screenprint!” from real screenprinters. I learned from watching videos on Youtube and reading blog articles and I was interested and wanted to learn. I feel like it's not unwise for a business on etsy to share how they make things, because 1) then the consumer gets a deeper insight and connection into how something's made and 2) even if you know how to make something it doesn't mean you'll be good at it.
I always encourage the businesses on etsy to be more open with what they do. It's kind of an old-fashioned notion to think “I must protect this from everybody!” The world is lateral and open now.
Copyright is a whole really interesting thing. I was actually reading about it in Life Inc., I think it was; Douglas Rushkoff's book. Interesting history of copyright and incorporation and all these things. Basically it was a way for the king to make money. (Laughter)
It's really interesting but you see this happening with everything. Paperhouses is a good example. It's the music industry, publishing industry. I think on some level we need to understand that we can't go back to buying CDs. You have to look at other ways to make a business. Part of it is you're giving it away but you get a return in another way. Maybe increased attendance or merchandise or limited edition art object recordings that are special things. The music is the marketing for these products.
With the open source community being so generative for small markets and the word I see on Etsy is “human scale economy”…
That's interesting, we have a whole team called the “human scale team” working on some stuff now.
I think it's such an apt description.
It's all E.F. Schumacher, Small is Beautiful. There's an essay in his book that's called “Buddhist Economics,” which is basically about human-scaled economies. We're very interested in it as it pertains to manufacturing, because there's a perception that it's all a sweatshop in the developing world. That's not the case. 86% of manufacturing in America is 12 people or less. And there are a lot of these family businesses and small shops. We're interested in how to scale businesses ethically and get some manufacturing assistance. Because if you're successful on Etsy… like you can't knit a thousand scarves in your living room by yourself, but you don't want to send it some place where there's not transparency, so how do we provide more transparency to these things?
Transparency is a good thematic too, which goes to my next question, but the thing with Etsy that confounds a lot of people less initiated is the relationship between small scale and large scale. I mean you're careful about not letting major brands infiltrate. What do you think is the bigger picture relationship between Etsy and mass merchandisers and major retail? I mean even e-commerce in the last 8 years you've been up, has exploded, so…
I think there's two pieces of it. As far as mass retailers, we don’t ever want to be selling the things that they make on Etsy, but I don't think mass retail in and of itself is evil. What we're looking for is how can we leverage the ubiquity to help small independent creative businesses. We have two specific partnerships right now: West Elm and Nordstroms. Across the country now, Nordstroms have these kiosks that sell locally made home furnishings and goods. Nordstroms is now able to compete with this growing trend around local and artisanal in a way they can't do on their own. So for them it's a brand win. For us, our mission is about empowering all these small businesses, so if we can get them that outlet and that channel that's great! It's great brand exposure for us too.
I used to be more like “fuck those dudes!” (fist raised in air). It takes discipline and time to do it differently, plus it's expensive. I think it's worth it but it's an interesting thing…
What are some of the pitfalls or obstacles Etsy is facing as you expand?
We've always had critics, of course. I think it's reaching a bit of a fever pitch right now, because I don't think we're totally clear on our policies. They're a little bit… they were built to protect the values we have but over the years they've become bureaucratic. The debate is really around what is handmade. That's a really hard thing to determine.
But you know, the community of Etsy has always been very vocal and I think it's a positive thing. To me the solution is to be clear and honest and stick to your guns. I think we're going to keep going forward. I know we're not doing anything bad or malicious.
Actually I was going to say the major criticism I hear about Etsy is precisely, not about the moral rectitude of the company but that it's prohibitively righteous. It's “oh my god I don't understand these rules and want to sell something but don't want to deal with all these stuck-up locavores,” to be blunt.
Sure, it's a challenge. For both sides. There's no doubt I feel like we've made it overly complicated in trying to protect what we hold sacred. There's an evolution, there's been an evolution… things have to evolve. That's the nature of the world. I actually see the evolution of Etsy as a very healthy one. We're going to evolve to a place where there's more clarity and transparency and clearer about our value and how we operate. That's my job here.
I actually think that we have an imperative to minimize our ecological impact both because I feel like the world has the imperative to do this right now but also we have the potential to have a lot of positive impact if we leverage this platform of 30 million people and help them do the same thing. So it's one thing if we put solar panels in the office but it's a different one if we can help a million different companies use solar power by doing business development with these solar companies.
Or manufacturing resources.
Exactly. I'm super excited about the future of manufacturing. I mean everyone's talking about 3D printing and that will happen. We'll soon be beyond the plastic Makerbot thing and very quickly. But very interesting is ecological point of view.
What if it's not even a technological advance but a network of screenprinters and I design a t-shirt, you're in Spain, I'm in Brooklyn, I'll email it to a pre-vetted local producer who knows how to do this stuff, who can hand-deliver it to you. Very little ecological impact.
That’s actually much of Paperhouses philosophy, too. It’s really efficient on top of being sustainable, anywhere in the world.
There's that awful word “glocal”(laughter) but I think it's actually, how do you build a global network of connected human-scale economies? That's when you start talking about production, transparency, connection, and looking at fulfillment and all these things. How do we do these things with the least ecological footprint but also help to foster these connections. I think we can continue to reconcile these things. Especially if we begin to focus on like “what if we had a network of responsible manufacturers in all these countries?” That's how we can have a glocal relationship. Oh god (laughter)
I think you just made that word happen.
I don't know who made that word up but it's awful.
Don’t lie, you did. (Laughter) In the beginning you mentioned a second open source initiative…
Oh right. I'm working on a platform called Open Impact. The idea stems from when I started doing Value and Impact, I made it up. I made up the team, I made up the role…
It sounds made up. (Laughter)
I know what I'm trying to do but I have no idea how I'm going to do this. I'm still figuring it out. It's been a year, and we've done a lot of stuff but it's constantly evolving. What I said was “I wish there was a website that told me how to do this stuff or have another company show me how to do this stuff.” Then I thought “aha, build that website!” because it's going to help me both with my work as I continue but I put a shit ton of work into this stuff that other companies I hope are doing, too. So one of the ways we maximize our impact is showing other companies how to do it.
I'll give you some examples. We developed a well-being index for Etsy employees, and worked with the University of Pennsylvania on it. So now we have a system for measuring the well-being of our employees, and we can open source that. If any other company wants to use it to measure the well-being of their employees, great! It's for businesses by businesses to improve their impact in the world. Also their operations. Minimizing operational impact. We've done things like analyze the carbon footprint of the Etsy marketplace. That was really complicated! It's complicated, but it's really useful information. We're going to give people that. This is something that we're building with another company called Imperative. The idea is to launch it into the world as an independent entity. The work my team does; part of the process is to create the open source piece of it that you want to share.
So it's open source office culture.
Yeah, it's like open source CSR (Corporate Social Responsibility) plus office culture. Because what I realized is that when I started this team I called it Brand and Social Responsibility but the more I learned about CSR, I realized it's not what we're doing. CSR is when Remington Rifles gives money to the art world and their employees clean up a park once a week, and recycle. Not that that's bad. But their business is still making guns.
Right, for them CSR is a penance.
Yeah! Even the word “responsibility” implies they're bad. I'm interested in how do you actually use the business itself for impact in the world. That's something different. There are those elements of CSR. Operationally we need to get our own house in order. That's connected to the B-Corp stuff as well, which our team handles.
I think B-Corp is important but it's just a system of measurement and what's behind it is really important. That means you're doing all of this stuff. Actually this Open Impact is the perfect compliment to being a B-Corp because you get the rating with B-Corp, but Open Impact is how you do it. We had to figure this stuff out. When we first underwent the B-Corp process, we got 80.1, and passing is 80. We barely passed. Now we're probably up around 105. We've done a lot of improve but we're really just figuring it out.
I’m shocked Etsy barely passed. It's interesting because in the beginning of the Internet and e-commerce, it was supposed to represent a more sustainable solution to the brick-and-mortar store.
Yeah, but it's the data centers. Data centers are awful. They represent 60% of our footprint. It rivals the marketplace’s shipping. Just last year, shipping Etsy products in the United States alone represented 29 billion miles. Not like each one's driving a car. (Laughter) But that just shows data centers are serious. There's a lot of issues with data centers. You have to keep them cold. There's a tremendous amounts of power, backup generators. Everything's there to make sure the site never goes down. It's been really interesting to dig more deeply into this stuff. Now there are some green data centers and people like Google have done a lot to make green data centers, but they own their centers. We’re not there yet.
Lastly, is Etsy a tech company?
That's a great question. I don't think it is but I guess most people here do. (Laughter)
If it looks and smells like one…
I mean most of the people who work here are engineers and developers. Our product is a technological platform, right? So we are, but we're a commerce company. We're a marketplace but we don't make anything. We're in the business of providing tools for small businesses.
You can find Matt at Etsy but not on Facebook! You can find us on Facebook. Twitter too! Did you know, Matt's also a musician? Check out our past interview with Jordan Bass on Beck's “Song Reader” here.