DEF 14A of Etsy Inc, Apr 22, 2024

DEF 14A of Etsy Inc

Filed Apr 22, 2024 · FY20230001370637-24-000021

Open on EDGAR

  1. Colin Stretch

    | Executive Compensation Tables | | 56 | | Summary Compensation Table | | 56 | | Grants of Plan-Based Awards Table | | 57 | | Outstanding Equity Awards at Fiscal Year-End Table | | 58 | | Option Exercises and Stock Vested Table | | 59 | | Potential Payments Upon Termination or Change of Control | | 60 | | Pay Ratio Disclosure | | 62 | | Pay Versus Performance | | 63 | | Proposal 3: Ratification of the Appointment of Independent Registered Public Accounting Firm | | 67 | | Fees and Services | | 68 | | Pre-Approval Policies and Procedures | | 68 | | Audit Committee Report | | 69 | | Proposal 4: Approval of 2024 Equity Incentive Plan | | 70 | | Background | | 70 | | Why Our Board Supports This Proposal | | 70 | | Equity Awards Outstanding and Shares Available for Grant | | 71 | | Historical Burn Rate and Overhang | | 72 | | Summary of 2024 Equity Incentive Plan Terms | | 72 | | Prior Grants Under the 2015 Equity Incentive Plan | | 76 | | Equity Compensation Plan Information | | 77 | | Security Ownership of Certain Beneficial Owners, Directors, and Management | | 78 | | Certain Relationships and Related Person Transactions | | 80 | | Voting and Meeting Information | | 81 | | Additional Information | | 86 | | Non-GAAP Financial Measures | | 88 | | Appendix A - 2024 Equity Incentive Plan | | 89 |

  2. Revenue grew 236% from 2019 to 2023

    Revenue grew 236% from 2019 to 2023 We are a global company, and our vibrant “House of Brands” community includes people buying or selling in nearly every country in the world. Collectively, the Etsy, Reverb, and Depop marketplaces connected a total of 9.0 million active sellers to 96.5 million active buyers as of December 31, 2023. In 2023, 45% of our consolidated GMS was generated when a seller or buyer, or both, were located outside of the United States. For more information on our strategy and our consolidated financial results, please see our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (our “Form 10-K”). Commitment to Impact Strategy and ESG Accountability We apply similar focus, discipline, and accountability to our environmental, social, and governance (“ESG”) reporting metrics as we do to our financial metrics, and we believe that together they make us stronger and more resilient. We recently reported on our Impact strategy and ESG goals and 2023 progress as part of our Form 10-K. We use our filings with the U.S. Securities and Exchange Commission (“SEC”), as well as our Investor Relations website and our Etsy News blog, as our primary communications channels for information relating to our Impact strategy and progress. We have various approaches for determining what information we disclose in our ESG reporting, including feedback we receive from the financial community and other stakeholders. Etsy continues to report our Impact metrics using the Sustainability Accounting Standards Board (“SASB”) sector standards for our industry and the Task Force on Climate-Related Financial Disclosures (“TCFD”) framework. We also publish our consolidated Equal Employment Opportunity (“EEO-1”) report on our Investor Relations website. We have included some of our Impact highlights on the following pages. For more information on our Impact strategy and ESG goals and progress, as well as our SASB and TCFD reporting, please see our Investor Relations website and our Form 10-K at pages 19-41.

  3. Revenue grew 236% from 2019 to 2023

    | 2024 Proxy Statement | 9 |

  4. Revenue grew 236% from 2019 to 2023

    Our Impact framework holistically expresses the positive impact we want our business to have Impact Highlights We are committed to growing sustainably by aligning our mission and business strategy to help create economic impact through entrepreneurship and, therefore, create value for all our stakeholders. Our Impact highlights in 2023 include the following:

  5. Revenue grew 236% from 2019 to 2023

    | ENVIRONMENTAL | SOCIAL | GOVERNANCE | | In 2023, we made progress on our emissions reductions targets for Scopes 1, 2, and 3. Our Scope 3 emissions intensity (tCO2e/ million $ gross profit) declined 16% year-over-year, keeping us on track for our 2030 interim target as we work toward our Net Zero goal validated by the Science Based Target Initiative. For 2023, we have sourced renewable energy for the electricity we measured or calculated as used to power our Etsy marketplace, Reverb and Depop offices and employees working from home, as well as Etsy marketplace's computing load in Google Cloud. Over the course of 2023, sellers created over 100 million listings with circular attributes on the Etsy marketplace, Depop, and Reverb. We expanded our Disaster Response program that offers grants to Etsy marketplace U.S. sellers impacted by a Federal Emergency Management Agency (FEMA) declared disaster. We also developed resource guides to make it easier for sellers to access climate-related disaster response and preparedness information and funding. | In 2023 we continued to make progress on our employee diversity, equity, and inclusion goals. At December 31, 2023, 15.4% of Etsy marketplace U.S. employees identified as Black, Latinx, or Native American. In 2022, we set an ambitious goal to prioritize Disability Inclusion and Accessibility for employees at our Etsy marketplace, and the Etsy marketplace committed to scoring an 80 or above on DisabilityIn.org's Disability Equality Index in 2023. This commitment enabled us to create a roadmap of enhancements across our workplace programs, policies, and practices for the Etsy marketplace - and we are proud to have achieved a score of 100 as a result. In 2023, our Impact Investment Fund invested $16 million with the hope to propel economic growth for entrepreneurs through several investments. These investments provide capital and wrap around business support services to entrepreneurs, particularly business owners who face barriers to access that impede their ability to grow. | In alignment with our mission to “Keep Commerce Human” and as part of our commitment to upholding and promoting human rights across our marketplaces and throughout our value chain, we published our Human Rights Commitment in 2023. In 2023, we also published our Modern Slavery Statement, developed roadmaps for updating our supplier selection and management processes, made updates to our Supplier Code of Conduct to more explicitly include human rights, and clarified and expanded upon elements of our Imagery of Minors policy. Additionally, we formed a cross-functional working group that reports to our Chief Technology Officer on the responsible use of artificial intelligence across our marketplaces, in our operations, and through our partnerships. |

  6. Revenue grew 236% from 2019 to 2023

    | 10 | Etsy |

  7. Revenue grew 236% from 2019 to 2023

    Culture and Engagement We believe that our action-oriented, values-based, and purpose-driven work culture is a competitive advantage in attracting and retaining top talent. Etsy’s employees work diligently to bring innovative ideas to Etsy to strengthen the experience for sellers and buyers in our marketplaces. We are focused on maximizing our employees’ engagement, which is linked with high performance, retention, innovation, and growth. Etsy continues to support hybrid working modes, while gathering together periodically with intention and careful planning, in spaces built with inclusive design. We offer paid family leave policies, as well as periodic company-wide “rest and recharge” days to supplement Etsy’s paid time off. Employees may also utilize regular “focus days,” full days where non-critical meetings are canceled and we focus on digging deep into individual work. Etsy also continues to offer mental health days and easy access to mental health benefits and coaching to our employees as part of our overall approach to well-being. We remain committed to building a workplace where people of all backgrounds and walks of life can thrive. In 2023, we continued to make progress on our employee diversity, equity, inclusion goals, while also updating some of our targets and commitments. We have continued our commitment to creating safe-space communities through our Employee Resource Groups and other affinity groups, made improvements to increase employee accessibility and disability inclusion, and refreshed our new hire orientations, competency matrices, and our performance enablement programs to enable equity. Additionally, we take proactive measures at each step of the employee journey that focus on fair pay practices. As part of our commitment to fair pay practices, we completed our most recent biennial third-party pay equity analysis in 2022. The purpose of this analysis was to look at pay across jobs and levels to ensure our practices are fair and consistent and that compensation is not influenced by gender, race/ethnicity, or the intersection of both dimensions. Our 2022 pay equity analysis found no unexplained pay gaps adverse to women, employees from other marginalized genders, or non-white employees. Additionally, there were no unexplained pay gaps based on intersectionality (i.e., based on the combination of gender and race/ethnicity). We plan to continue to comprehensively audit pay equity biennially with an external consultant, and conduct internal reviews several times a year in conjunction with events such as performance rating and promotion decisions. We are also focused on maximizing employee engagement. In 2023, we conducted engagement surveys of all Etsy marketplace, Reverb, and Depop global employees. Of all employees surveyed across each brand, 85% of Etsy marketplace, 86% of Reverb, and 76% of Depop employees submitted a response. 80% of Etsy marketplace respondents, 72% of Reverb respondents, and 75% of Depop respondents reported favorable employee engagement. Beyond our own employees, we are also striving to create an equitable and sustainable supply chain that supports our “House of Brands” while reducing our carbon footprint, supporting diverse businesses, and bringing new economic opportunities to our suppliers and their employees. Etsy renewed our commitment to enable equitable access to economic opportunities by launching a new Supplier Diversity Program in 2023, including a target to reach $120 million in diverse spend (defined as spend with woman-owned, disability-owned and LGBTQ-owned businesses globally; as well as with businesses owned by underrepresented racial communities (Black, Asian-Indian, Asian-Pacific, Hispanic/Latinx, and Indigenous) and veterans in the United States) across our “House of Brands” by 2025. For more information on our focus on diversity, equity, and inclusion, please see our Form 10-K at pages 25-30, along with our workforce metrics at pages 30-31. Executive Team

  8. Revenue grew 236% from 2019 to 2023

    | We believe that we have built a highly qualified and effective Executive Team. | | | Each person brings fresh perspectives and deep expertise to their particular roles. Additionally, we’re proud that more than half of our Executive Team identify as women. Our Executive Team consists of: | | | •Josh Silverman, President and Chief Executive Officer, leading Etsy as it builds platforms that empowers creative entrepreneurs around the world •Rachel Glaser, Chief Financial Officer, leading our enterprise-wide global finance operations •Nicholas Daniel, Chief Product Officer, leading the Etsy marketplace product development efforts worldwide, building shopping experiences across platforms, and overseeing Etsy's payments and fulfillment functions •Rachana Kumar, Chief Technology Officer, leading the Etsy marketplace engineering teams with a focus on leveraging technology to create economic empowerment opportunities | •Raina Moskowitz, Chief Operating and Marketing Officer, leading the Etsy marketplace marketing, international, trust and safety, member support, strategy and operations, and our enterprise-wide impact team •Toni Thompson, Chief Human Resources Officer, leading our enterprise-wide human resources team, aligning talent to growth opportunities, and continuing to shape how Etsy approaches the future of work •Colin Stretch, Chief Legal Officer and Corporate Secretary, leading our enterprise-wide legal, policy, compliance, and advocacy teams |

  9. Revenue grew 236% from 2019 to 2023

    | 2024 Proxy Statement | 11 |

  10. Revenue grew 236% from 2019 to 2023

    Voting Roadmap

  11. Revenue grew 236% from 2019 to 2023

    | Proposal 1 Election of Directors | | At our Annual Meeting, three Class IlI directors are standing for election, each for a three-year term. Our Board has nominated Marla Blow, Gary S. Briggs, and Melissa Reiff for election as Class IlI directors at our Annual Meeting. • See page 13 | | | Our Board recommends a vote FOR each nominee for Director. | |

  12. Revenue grew 236% from 2019 to 2023

    | Proposal 2 Advisory Vote on Named Executive Officer Compensation | | This proposal, commonly referred to as the “say-on-pay” vote, gives our stockholders the opportunity to express their views on the compensation of our named executive officers. This vote is not intended to address any specific item of compensation or any specific named executive officer, but rather the overall compensation of all of our named executive officers and our executive compensation philosophy, objectives, and program, as described in this proxy statement. | | | Our Board recommends a vote FOR this proposal. | | | | | • See page 38 |

  13. Revenue grew 236% from 2019 to 2023

    | Proposal 3 Ratification of the Appointment of Independent Registered Public Accounting Firm | | Our Audit Committee has appointed PricewaterhouseCoopers LLP as our independent registered public accounting firm for 2024 and recommends that stockholders vote to ratify the appointment. PricewaterhouseCoopers LLP has audited our consolidated financial statements since 2012. • See page 67 | | | Our Board recommends a vote FOR this proposal. | |

  14. Revenue grew 236% from 2019 to 2023

    | Proposal 4 Approval of the 2024 Equity Incentive Plan | | Our Board has approved an amendment and restatement of the Etsy, Inc. 2015 Equity Incentive Plan (the “2015 Equity Incentive Plan”), subject to stockholder approval. In connection with amending and restating the 2015 Equity Incentive Plan, the name of the 2015 Equity Incentive Plan was updated to the Etsy, Inc. 2024 Equity Incentive Plan (the “2024 Equity Incentive Plan”). We are asking stockholders to approve the 2024 Equity Incentive Plan. | | | Our Board recommends a vote FOR this proposal. | | | | | • See page 70 |

  15. Revenue grew 236% from 2019 to 2023

    | 12 | Etsy |

  16. Revenue grew 236% from 2019 to 2023

    | Proposal 1 | | Election of Directors |

  17. Revenue grew 236% from 2019 to 2023

    In accordance with our amended and restated certificate of incorporation, our Board, which currently has ten members, is divided into three staggered classes of directors. Our Board has nominated Marla Blow, Gary S. Briggs, and Melissa Reiff for re-election as Class III directors at the 2024 Annual Meeting, each for a three-year term. Each nominee is independent and has consented to serve as director, if elected. We have no reason to believe that any nominee will be unable or unwilling to serve as director. If a nominee is unavailable for election, your proxy authorizes us to vote for a replacement nominee if our Board names one. In late 2023, our Board adopted a majority voting standard for uncontested director elections. To be elected, each director must receive a majority of the votes cast with respect to that director’s election. Any incumbent director who fails to receive the required number of votes for re-election shall submit his or her resignation for consideration by our Nominating and Corporate Governance Committee. Our Nominating and Corporate Governance Committee will consider all of the relevant facts and circumstances and recommend to the Board the action to be taken with respect to such offer of resignation. The Board will then act on the Nominating and Corporate Governance Committee's recommendation as it deems appropriate. Promptly following the Board's decision, Etsy will disclose that decision and an explanation of the decision in a filing with the Securities and Exchange Commission or a press release. If elected at our Annual Meeting, the nominees will serve until our 2027 Annual Meeting of Stockholders and until their successors have been elected and qualified or until they resign, die, or are removed from our Board. For information about the nominees and each director whose term is continuing after our Annual Meeting, please see the following pages.

  18. Revenue grew 236% from 2019 to 2023

    | | Our Board recommends a vote “FOR” each director nominee named above. |

  19. Revenue grew 236% from 2019 to 2023

    | 2024 Proxy Statement | 13 |

  20. Revenue grew 236% from 2019 to 2023

    Etsy's Board The following table provides summary information about our Board. See pages 15-21 for more information.

  21. Revenue grew 236% from 2019 to 2023

    | | C. Andrew Ballard Age: 51 Director Since: 2021 Class: I Committees: Compensation | | Melissa Reiff Age: 69 Director Since: 2015 Class: III Committees: Compensation (Chair) | | | Marla Blow Age: 53 Director Since: 2021 Class: III Committees: Risk Oversight (Chair) | | Josh Silverman President and Chief Executive Officer Age: 55 Director Since: 2016 Class: II | | | Gary S. Briggs Age: 61 Director Since: 2018 Class: III Committees: Risk Oversight | | Margaret M. Smyth Age: 60 Director Since: 2016 Class: I Committees: Audit (Chair) | | | M. Michele Burns Age: 66 Director Since: 2014 Class: II Committees: Audit; Nominating and Corporate Governance | | Marc Steinberg Age: 34 Director Since: 2024 Class: I Committees: Audit | | | Jonathan D. Klein Age: 63 Director Since: 2011 Class: I Committees: Compensation | | Fred Wilson Chair Age: 62 Director Since: 2007 Class: II Committees: Audit; Nominating and Corporate Governance (Chair) |

  22. Revenue grew 236% from 2019 to 2023

    | 14 | Etsy |

  23. Revenue grew 236% from 2019 to 2023

    Director Skills and Experience Matrix Since 2022, Etsy has requested that each of our directors provide a more detailed skills and experience self-assessment which allows for more robust disclosure of that information. All of our directors bring leadership and corporate governance experience to our boardroom. The following chart summarizes other areas important to the oversight of Etsy's business where our directors have substantial knowledge and experience.

  24. Revenue grew 236% from 2019 to 2023

    | | Josh Silverman | Andrew Ballard | Marla Blow | Gary Briggs | Michele Burns | Jonathan Klein | Melissa Reiff | Margaret Smyth | Marc Steinberg | Fred Wilson | | Technology, e-commerce and digital media | | | | | | | | | | | | Brand strategy, marketing, or merchandising | | | | | | | | | | | | Global commerce or international business | | | | | | | | | | | | Human resources or talent | | | | | | | | | | | | Impact/ESG | | | | | | | | | | | | Strategic transactions | | | | | | | | | | | | Payments processing | | | | | | | | | | | | Finance, accounting, or financial reporting | | | | | | | | | | | | Risk management | | | | | | | | | | | | Information security/cybersecurity | | | | | | | | | | | | Data analytics | | | | | | | | | | | | Other current public company board service | | | | | | | | | | |

  25. Revenue grew 236% from 2019 to 2023

    Board Skills Descriptions:

  26. Revenue grew 236% from 2019 to 2023

    | Technology, e-commerce, and digital media | Brand strategy, marketing, or merchandising | Global commerce or international business | Human resources or talent | | Contributes to our understanding of how business and technology can strengthen our communities and empower people and entrepreneurship while Keeping Commerce Human. | Provides awareness of approaches that effectively communicate the story and value of our brand and our mission. | Contributes to an understanding of how our two-sided online marketplaces connect millions of passionate and creative buyers and sellers around the world and the infrastructure needed to support our global operations. | Enhances oversight of Etsy’s key human resources strategies and programs through understanding of how we manage and develop our workforce, foster an inclusive environment, and promote equity and inclusion throughout Etsy. | | Impact/ESG | Strategic transactions | Payments processing | Finance, accounting, or financial reporting | | Contributes to an understanding of the relationship between our strategy and our mission to make a positive impact on the world and create economic impact through entrepreneurship. | Provides awareness of how strategic transactions, including acquisitions, divestitures, and capital market transactions, could impact our business and/or inflect our market opportunity. | Enhances our understanding of the complex landscape of evolving laws, regulations, rules, and standards governing payments processing, as well as the direct and third-party processor operational and compliance risks. | Contributes to oversight of our financial statements and public company reporting requirements. | | Risk management | Information security/cybersecurity | Data analytics | Other current public company board service | | Enhances Board oversight of management’s risk management processes. | Enhances oversight of information security, cyber readiness, and data privacy protection and risks associated with cybersecurity matters. | Provides understanding of how scalable data analytics and machine learning can be used to improve our marketplaces, our organized and curated search results, and our buyers’ and sellers’ experiences, including through personalization. | Contributes to practical understanding of organizations, processes, governance, and oversight of strategy, risk management and growth. |

  27. Revenue grew 236% from 2019 to 2023

    | 2024 Proxy Statement | 15 |

  28. Revenue grew 236% from 2019 to 2023

    Diverse Representation and Perspective Our directors bring to our Board broad perspectives, experience, and knowledge relevant to our mission to Keep Commerce Human. Half of Etsy's Board self-identified with diverse attributes, and three of our four Board Committee Chairs identify as women. The following charts present certain aspects of our Board's diverse characteristics:

  29. Revenue grew 236% from 2019 to 2023

    | Director Independence | Gender | LGBTQ+ | | | | | | Tenure | Race/Ethnicity | Disability | | | | |

  30. Revenue grew 236% from 2019 to 2023

    These attributes were self-disclosed by our directors through an optional diversity question included in our director questionnaire. The survey captured Board members' identity or affiliation including within the following categories, which is presented in accordance with Nasdaq's Board Diversity Rule categories:

  31. Revenue grew 236% from 2019 to 2023

    | Board Diversity Matrix (As of April 22, 2024) | | | | | | Total Number of Directors | 10 | | | | | | Female | Male | Non-Binary | Did Not Disclose Gender | | Part I: Gender Identity | | | | | | Directors | 4 | 6 | 0 | 0 | | Part II: Demographic Background | | | | | | African American or Black | 1 | 1 | 0 | 0 | | Alaskan Native or Native American | 0 | 0 | 0 | 0 | | Asian | 0 | 0 | 0 | 0 | | Hispanic or Latinx | 0 | 0 | 0 | 0 | | Native Hawaiian or Pacific Islander | 0 | 0 | 0 | 0 | | White | 3 | 5 | 0 | 0 | | Two or More Races or Ethnicities | 0 | 0 | 0 | 0 | | LGBTQ+ | 2 | | | | | Disabled | 1 | | | | | Did Not Disclose Demographic Background | 0 | | | |

  32. Revenue grew 236% from 2019 to 2023

    To see our Board Diversity Matrix as of April 25, 2023, please see the proxy statement filed with the SEC on April 25, 2023.

  33. Revenue grew 236% from 2019 to 2023

    | 16 | Etsy |

  34. Revenue grew 236% from 2019 to 2023

    Director Nominees and Continuing Directors Nominees for Election to a Three-Year Term Expiring at the 2027 Annual Meeting of Stockholders

  35. Revenue grew 236% from 2019 to 2023

    | | | | | Key Qualifications Marla Blow brings to our Board her significant experience with payments and financial services, her experience as a regulator, and her expertise in platforms that support small business. In addition, she has advocated for creative entrepreneurship as a path to economic empowerment, and brings experience as a purpose-driven leader in both the private and public sectors. Professional Experience •President and Chief Operating Officer of Skoll Foundation, which invests in and supports social entrepreneurs, where she leads Skoll’s program work, grants, investments, and financial management, since March 2021 •Senior Vice President for Social Impact in North America, Mastercard Center for Inclusive Growth from October 2019 to March 2021 •Founder and Chief Executive Officer, FS Card Inc., a subprime credit card venture, from 2014 to January 2019 (sold to a strategic acquirer); and a Partner in Fenway Summer LLC, a consumer finance investment and venture capital firm that incubated FS Card •Prior to that: Assistant Director, Card and Payments Markets Group, Consumer Financial Protection Bureau, and various positions in the credit card business at Capital One Other Public Company Directorships •Care.com (February 2018 to March 2020) (acquired by IAC/InterActive Corp) •FactorTrust, Inc. (2016 to 2017) (acquired by TransUnion) Other Information •Director of Square Financial Services, an independent banking subsidiary of Block Inc., formerly known as Square, Inc. (since March 2021) | | Marla Blow INDEPENDENT Age: 53 Director since: 2021 Risk Oversight Committee (Chair) | |

  36. Revenue grew 236% from 2019 to 2023

    | | | | | Key Qualifications Gary S. Briggs brings to our Board his significant brand strategy and marketing expertise, as well as his executive and leadership experience at technology and e-commerce companies. Professional Experience •Senior Advisor, Paid Media, Biden for President, since April 2024 •Chairman of Hawkfish, LLC, a political data and technology-based digital marketing company, from September 2019 to May 2021 •Vice President and Chief Marketing Officer of Facebook, Inc. (now known as Meta Platforms, Inc.), a social media company, from 2013 to November 2018 •Prior to that: various marketing roles at Google, Inc.; eBay Inc.; PayPal, Inc.; IBM Corp.; and PepsiCo Other Public Company Directorships •Petco Health & Wellness Company Inc. (since 2018) •Afterpay Limited (January 2020 to March 2022) (acquired by Block, Inc., formerly Square, Inc.) •LifeLock, Inc. (2013 to 2017) (acquired by Symantec Corporation) Other Information •Director of Combe, Inc., a private company (since 2023) | | Gary S. Briggs INDEPENDENT Age: 61 Director since: 2018 Risk Oversight Committee | |

  37. Revenue grew 236% from 2019 to 2023

    | 2024 Proxy Statement | 17 |

  38. Revenue grew 236% from 2019 to 2023

    | | | | | Key Qualifications Melissa Reiff brings to our Board her significant operational experience, her expertise in retail, marketing, and merchandising, and her knowledge of executive compensation and talent management. She also brings experience as a Chief Executive Officer and as a director of public companies. Professional Experience •Chief Executive Officer, The Container Store Group, Inc., a storage and organization specialty retailer, from 2016 until her retirement in February 2021 •President and Chief Operating Officer of The Container Store Group, Inc., from 2013 to 2016, having served as President from 2006 to 2013 Other Public Company Directorships •Cricut, Inc. (since March 2021) •The Container Store Group, Inc. (2007 to September 2021) | | Melissa Reiff INDEPENDENT Age: 69 Director since: 2015 Compensation Committee (Chair) | |

  39. Revenue grew 236% from 2019 to 2023

    Directors Continuing in Office

  40. Revenue grew 236% from 2019 to 2023

    | | | | | Key Qualifications C. Andrew Ballard brings to our Board his executive and leadership experience across the technology, marketing, data analytics, media, and finance industries, as well as his strategic business and acquisition experience as a director of, and investor in, businesses in all stages of growth. Professional Experience •Chief Executive Officer and Co-Founder of Wiser Solutions, Inc., a software and data company focused on brands and retailers, since 2012 •Founder and Managing Partner of Figtree Partners, an investment firm focused on software and technology, since 2012 •Senior Advisor at Hellman & Friedman LLC, a private equity firm, from 2012 to 2019, and Managing Director, from 2006 to 2012 •Prior to that: various positions at Bain Capital, LLC and Bain & Company, Inc. Other Public Company Directorships •Domino’s Pizza, Inc. (since 2015) Other Information •Director of private companies, including CrossFit, Datacor, Inc., and Zignal Labs | | C. Andrew Ballard INDEPENDENT Age: 51 Director since: 2021 Compensation Committee | |

  41. Revenue grew 236% from 2019 to 2023

    | 18 | Etsy |

  42. Revenue grew 236% from 2019 to 2023

    | | | | | Key Qualifications M. Michele Burns brings to our Board her expertise in corporate finance, accounting, governance, and strategy. She also brings expertise in global and operational management, including a background in organizational leadership and human resources, and experience as a public company Chief Financial Officer and director. Professional Experience •Advisory Board, Stanford Center on Longevity at Stanford University since October 2019, having served as the Center Fellow and Strategic Advisor from 2012 to October 2019 •Chief Executive Officer, Retirement Policy Center sponsored by Marsh & McLennan Companies, Inc. from 2011 to 2014 •Chairman and Chief Executive Officer, Mercer LLC, a human resources consulting firm, from 2006 to 2011, and Chief Financial Officer in 2006 •Prior to that: Chief Financial Officer at Delta Air Lines, Inc. and various positions at Arthur Andersen, serving ultimately as the Senior Partner, Southern Region Federal Tax Practice Other Public Company Directorships •Anheuser-Busch InBev SA (since 2016) •Goldman Sachs Group, Inc. (since 2011) •Cisco Systems, Inc. (2003 to 2023) •Alexion Pharmaceuticals, Inc. (2014 to May 2018) •Wal-Mart Stores, Inc. (2003 to 2013) | | M. Michele Burns INDEPENDENT Age: 66 Director since: 2014 Audit Committee Nominating and Corporate Governance Committee | |

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    | | | | | Key Qualifications Jonathan D. Klein brings to our Board his extensive experience with e-commerce, knowledge of marketplaces and digital media companies, and his experience as both a public company Chief Executive Officer and as a director of a number of public and private companies. Professional Experience •Co-Founder and member of the board of Getty Images, Inc., a global digital media company, having served as Chief Executive Officer from its inception in 1995 until 2015 •Executive-in-Residence/Catalyst Advisor at General Catalyst, a venture capital firm, from April 2018 to June 2023 Other Public Company Directorships •Getty Images Holdings, Inc. (since January 2022) and its predecessor company Getty Communications (since 1995) •Jumia Technologies AG (since January 2019) •Squarespace, Inc. (since 2010) Other Information •Director of several private companies, including Bloom & Wild Limited •Director of a number of non-profit organizations, including The Committee to Protect Journalists and The New Press, and a member of the Council on Foreign Relations | | Jonathan D. Klein INDEPENDENT Age: 63 Director since: 2011 Compensation Committee | |

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    | 2024 Proxy Statement | 19 |

  45. Revenue grew 236% from 2019 to 2023

    | | | | | Key Qualifications Josh Silverman brings to our Board his deep familiarity with our business through his tenure as our Chief Executive Officer, and his significant executive, operational, strategic, payments, data, and marketing experience. He also brings expertise in scaling and leading online marketplaces and technology companies. Professional Experience •President and Chief Executive Officer, Etsy since May 2017 •Senior Operating Advisor, Hellman & Friedman, a private equity firm, in 2017 •Executive in Residence at Greylock Partners, a venture capital firm, in 2016 •President of Consumer Products and Services, American Express Company from 2011 to 2015 •Prior to that: Chief Executive Officer of Skype from 2008 to 2010; Chief Executive Officer of Shopping.com, an eBay company, from 2006 to 2008; and, prior to that, served in various executive roles at eBay •Co-Founder and Chief Executive Officer of Evite, Inc. from 1998 to its sale in 2001 Other Public Company Directorships •Shake Shack Inc. (since 2016) | | Josh Silverman Age: 55 Director since: 2016 President and Chief Executive Officer | |

  46. Revenue grew 236% from 2019 to 2023

    | | | | | Key Qualifications Margaret M. Smyth brings to our Board her expertise in public company finance, accounting, strategic planning, and risk management. In addition, she brings significant international experience and leadership through her service as an executive and director of global public companies. Ms. Smyth also has experience in advancing sustainability accounting practices, holds SASB's FSA Credential, and holds a Certificate in Cyber-Risk Oversight from Carnegie Mellon University and the National Association of Corporate Directors, and a Fundamentals of ESG Certificate from the AICPA. Professional Experience •Partner, Global Infrastructure, QIC, a global infrastructure investor focused on ESG-themed investments in transport, energy, and utilities, and social/public/private partnership sectors, since July 2021 •U.S. Chief Financial Officer, National Grid plc, a multinational energy company, from 2014 to June 2021 •Vice President of Finance at ConEdison, Inc. from 2012 to 2014 •Prior to that: senior financial roles at United Technologies and 3M; Senior Managing Partner at Deloitte & Touche and Arthur Andersen Other Public Company Directorships •Lilium N.V. (since September 2021) •Frontier Communications Parent, Inc. (since June 2021) •Remitly Global, Inc. (since May 2021) Investment Company Directorships •Mutual of America Financial Group (two funds) (since 2005) | | Margaret M. Smyth INDEPENDENT Age: 60 Director since: 2016 Audit Committee (Chair) | |

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    | 20 | Etsy |

  48. Revenue grew 236% from 2019 to 2023

    | | | | | Key Qualifications Marc Steinberg brings to our Board his experience as an investor having responsibility for public and private equity investments across a broad range of industries and as a board member in the technology, digital media, and e-commerce industries. Professional Experience •Partner at Elliott Investment Management, L.P., an investment management firm, since January 2024, and Senior Portfolio Manager from 2015 to January 2024 •Prior to that: Centerview Partners (2012 to 2015) Other Public Company Directorships •Pinterest, Inc. (since December 2022) Other Information •Director of various private companies including Nielsen Holdings, plc, Syneos Health, and Cubic Corporation | | Marc Steinberg INDEPENDENT Age: 34 Director since: 2024 Audit Committee | |

  49. Revenue grew 236% from 2019 to 2023

    | | | | | Key Qualifications Fred Wilson brings to our Board his extensive experience with technology and social media companies, as well as his deep understanding of our business and operations through his tenure on our Board and as one of our early investors. Fred has significant experience in corporate governance, technology company strategy, and scaling businesses in growth. He is also a well-known thought leader on technology, venture capital, and management matters. Professional Experience •Founder and Partner, Union Square Ventures, a venture capital firm, since 2003 •Chair of the Board of Etsy since May 2017, having served as our Lead Independent Director since 2014 •Prior to that: Venture capitalist for over 30 years Other Public Company Directorships •Coinbase Global, Inc. (since January 2017; publicly traded since April 2021) Other Information •Director of various private companies in connection with his role at Union Square Ventures and in a personal capacity | | Fred Wilson INDEPENDENT Age: 62 Director since: 2007 Chairman of the Board Audit Committee Nominating and Corporate Governance committee | |

  50. Revenue grew 236% from 2019 to 2023

    | 2024 Proxy Statement | 21 |

  51. Revenue grew 236% from 2019 to 2023

    Corporate Governance Key Features of our Corporate Governance We believe Etsy is a unique company and, because of that, our Board's philosophy is that effective corporate governance should not be a one-size-fits-all solution. Our governance strategy has continued to evolve as Etsy has matured as a public company. Below are our recent governance updates, many of which have been made in response to feedback from our long-term investors, as well as the key features of our corporate governance: Recent Governance Updates

  52. Revenue grew 236% from 2019 to 2023

    | 2023 | •Adopted majority voting for uncontested director elections (see page 24) •Adopted overboarding policy (see page 24) •Formed Risk Oversight Committee (see page 25) •Adopted clawback policy (see page 53) •Added disclosure around ratio of Chief Executive Officer (“CEO”) compensation to other Named Executive Officers (“NEO”) compensation (see page 41) | | 2022 | •Began publishing consolidated EEO-1 Report and refreshed proxy to better highlight our governance evolution •Adopted a proxy access bylaw •Adopted Stock Ownership Guidelines •Added a “Mansfield Rule” in our Policies and Procedures for Director Candidates | | 2021 | •Added Performance Share Units (“PSUs”) to executive compensation program | | 2020 | •Formalized a director diversity policy •Added a director resignation policy for plurality plus voting in director elections |

  53. Revenue grew 236% from 2019 to 2023

    | Key Features of our Corporate Governance | | | Board Structure & Independence | | | •Board comprised of sophisticated and fully engaged directors with different areas of relevant expertise •Independent Board Chair •Independent Board, except our CEO •Independent Committee members | •Even distribution of director tenure, resulting in a Board with both institutional and fresh perspectives •Notice required before accepting an invitation to serve on additional for-profit boards | | Board Oversight | | | • Formed a Risk Oversight Committee to assist our Board with oversight of Etsy's management of risk exposures, as well as management's processes for effectively monitoring and mitigating risk •Active Board risk management oversight | •Annual Board and Committee self-evaluations overseen by our Board Chair and our Nominating and Corporate Governance Committee •Periodic reviews of our corporate governance structure •Rigorous CEO evaluation process, and independent director oversight of executive succession planning | | Corporate Governance Practices | | | • Overboarding policy applicable to directors •Strong commitment to diversity in Board composition •Requirement that at least two candidates with diversity of race, ethnicity, or gender be included in any initial list of Board candidates considered by our Nominating and Corporate Governance Committee (Mansfield Rule) | •Stock ownership guidelines for directors and executive officers •Policy of no pledging or hedging of Etsy shares for current employees and directors •Robust code of conduct applicable to directors, officers, and employees •Regular executive sessions of independent directors | | Stockholder Rights and Engagement | | | •Proxy access bylaw allows stockholders to nominate and include directors in our proxy materials •Active, year-round stockholder engagement program | • A majority voting standard for director elections requiring any nominee for director who receives more votes against than for in an uncontested election to offer his or her resignation for consideration by our Nominating and Corporate Governance Committee and our Board |

  54. Revenue grew 236% from 2019 to 2023

    | 22 | Etsy |

  55. Revenue grew 236% from 2019 to 2023

    Stockholder Engagement Etsy executives maintain a very active, year-round engagement schedule meeting with the portfolio management teams at existing and potential stockholders around the world as part of our on-going investor relations activities. In connection with this broad engagement program, we met with 290 investment management firms during 2023, representing stockholders with nearly 70% of our outstanding common stock as of December 31, 2023. Since 2018, we have also conducted targeted, proactive outreach to offer investors the opportunity to specifically discuss corporate governance, environmental, social, and executive compensation issues. Since our 2023 Annual Meeting and as part of our off-season stockholder engagement efforts, we reached out to stockholders representing nearly 50% of our outstanding common stock and held discussions with all of the stockholders who wanted to meet. In these discussions we receive valuable feedback, which helps inform our Board's discussions of our corporate governance practices, environmental goals, and employment and executive compensation program, policies, and practices. For more information, see the section “Key Themes Discussed with Stockholders in 2023 and Early 2024.” The following illustrates our year-round engagement program:

  56. Revenue grew 236% from 2019 to 2023

    | Year-Round Investor Engagement | | | | Our management team maintains regular contact with our investors, including through quarterly earnings calls, individual meetings, and other communication channels, to hear questions and feedback. In April of each year, we publish our proxy statement. | | | | Annual Meeting | | Off-Season | | •We hold our Annual Meeting of Stockholders, typically in June. •We receive and summarize feedback from our Annual Meeting. •We identify any potential areas of concern and monitor governance trends and the needs of our business and stockholders. | | •We conduct our off-season stockholder engagement outreach on our executive compensation and environmental, social and corporate governance practices. •We review our corporate governance documents, policies, and procedures and plan for the upcoming reporting season. •We review our Impact strategy and progress on our ESG goals. We publish our Form 10-K. |

  57. Revenue grew 236% from 2019 to 2023

    Our management team has principal responsibility for investor relations, and their efforts are overseen by our Audit Committee. We believe our multi-faceted engagement program provides our stockholders with an effective channel for two-way dialogue with both our Board and management.

  58. Revenue grew 236% from 2019 to 2023

    | 2024 Engagement Program | | We are continuing our stockholder engagement program under our Board’s oversight in 2024 as we strive to further enhance and deepen our relationship with our stockholders with respect to these topics and other areas of interest to our stockholders. |

  59. Revenue grew 236% from 2019 to 2023

    | 2024 Proxy Statement | 23 |

  60. Other NEOs (on average)

    Other NEOs (on average) As reflected above, we believe that this design provides balanced incentives for our NEOs to drive financial performance and long-term growth and for our NEOs' interests to be aligned with the interests of our long-term stockholders. Throughout 2023, our stock experienced price volatility, which had meaningful impact on the value of the time-based and performance-based equity awards included in our executive compensation program. Additionally, in December 2023, our Board approved a restructuring plan designed to increase Etsy’s operational efficiencies, reduce operating costs, and better align Etsy’s workforce and cost structure with current business needs, top strategic priorities, and key growth opportunities (the “Restructuring Plan”). While the corporate performance component of our annual cash incentive program was achieved at 129%, taking into account overall business performance and the Restructuring Plan, as well as a recommendation from our Executive Team to limit their annual incentive compensation payouts, our Compensation Committee limited the annual incentive compensation payouts for the CEO to 50% of target payout opportunity and for the other NEOs to 75% of target payout opportunity. We believe that we have started 2024 energized, with the right team, a highly relevant and differentiated “Right to Win” strategy, a disciplined investment approach, and a resilient business model, and we expect that our executive compensation program will continue to reflect our pay-for-performance philosophy.

  61. Say-on-Pay Results and Stockholder Engagement

    | Stockholder Feedback | | Our Response | | •Our stockholders are consistently positive about our efforts to retain and incentivize our Executive Team. •Our stockholders are generally positive about the inclusion of PSUs in our equity compensation program design. Some stockholders would prefer longer performance periods for our PSUs and more differentiation between the metrics in our annual cash incentive program and our PSUs. •Several of our stockholders asked questions or commented on our consideration of pay equity among our CEO and our other NEOs. •Several stockholders inquired about our plans to adopt a clawback policy. •Several stockholders objected to the inclusion of an evergreen provision in our equity incentive plan. | | •Our Compensation Committee maintains a continued focus on retention of Mr. Silverman and our other Executive Team members. •We continue to include PSUs in the mix of equity awards granted to Mr. Silverman and our other executive officers. For 2023 and 2024 grants, we extended the performance period for PSUs with GMS, revenue, and adjusted EBITDA margin targets from one year to two years, and we continued the three-year performance period for PSUs with a relative total stockholder return (“TSR”) target. •We provide additional disclosure regarding the ratio of CEO to other NEO compensation. • We have adopted a clawback policy consistent with SEC rules and Nasdaq listing standards. • We have removed the legacy evergreen provision from our 2024 Equity Incentive Plan (see Proposal 4). We did not rely on the evergreen provision for 2024, as our Board approved a zero share increase in shares available for issuance as of January 2, 2024. • Subject to stockholder approval, we have reduced the number of shares available for awards pursuant to our 2024 Equity Incentive Plan, upon amendment and restatement, by approximately 76% to 8,000,000 shares (as compared to 33,859,046 shares available for awards pursuant to our 2015 Equity Incentive Plan as of March 31, 2024). |

  62. Say-on-Pay Results and Stockholder Engagement

    In addition to the topics described above, some stockholders inquired about the use of ESG metrics and criteria in our executive compensation program, including in our short-term and long-term incentive plans. We include in our annual cash incentive program individual performance objectives for each NEO, which include ESG goals tailored to their individual business responsibilities. Our short-term and long-term incentive plans and the related corporate performance objectives are described further in this Compensation Discussion and Analysis. We also disclose the ratio of CEO to other NEO compensation, in response to stockholder feedback. Over the 2017 through 2023 period (the period during which Mr. Silverman has served as CEO), the ratio of Mr. Silverman's average total compensation (computed in the manner required to be disclosed on the Summary Compensation Table) to the average total compensation received by our other NEOs (computed on the same basis, and excluding any compensation reported for 2017 for our former CEO, Chief Financial Officer and Controller) was approximately 3:1. Our Compensation Committee also considers the results of our say-on-pay votes. In 2023, 84% of the votes cast supported our say-on-pay proposal, indicating support for our executive compensation program. In 2023, we held a say-on-pay frequency vote, and 99% of votes cast supported holding future advisory votes on the compensation of Etsy's named executive officers every year. Based on the results of that vote, we intend to continue holding an annual advisory vote on the compensation of our named executive officers. Our Board and our Compensation Committee value the opinions of our stockholders, and we intend to continue to solicit and consider feedback obtained through our stockholder engagement program, as well as consider the voting outcome of future say-on-pay proposals. Furthermore, when making compensation decisions for our executive officers, our Board and our Compensation Committee remain focused on aligning compensation with performance and retention. For a more detailed discussion of our recent stockholder engagement activities, please see “Corporate Governance — Stockholder Engagement.”

  63. Elements of Annual Compensation

    | Element | Type | Primary Objective | Value Realized On Achievement Of | | Base salary | Fixed | Attract and retain | Service | | Annual cash incentives | Variable | Short-term company and individual performance | Service, GMS, revenue, adjusted EBITDA margin, and individual goals (includes ESG goals) | | Long-term incentives | Variable | Stockholder alignment, retention, and long-term value creation | Service and, for PSUs, GMS, revenue, adjusted EBITDA margin, and relative TSR |

  64. Elements of Annual Compensation

    | What We Do | | What We Don’t Do | | | | We maintain an independent Compensation Committee | | We do not contractually guarantee annual base salary increases to our Executive Team | | | Our Compensation Committee retains an independent compensation advisor who performs no other services for us | | We do not offer defined benefit retirement programs or excessive perquisites | | | Our Compensation Committee conducts an annual executive compensation review, including a review of our compensation peer group, and a compensation-related risk assessment | | We do not offer change-in-control excise tax reimbursement payments or “gross-ups” | | | We use variable pay, including long-term equity awards, as a substantial portion of our Executive Team’s target total direct compensation opportunity | | We prohibit hedging or pledging of our equity securities by our officers, employees, and directors | | | We have adopted Stock Ownership Guidelines designed to align our Executive Team's interests with those of our stockholders | | We do not permit stock option exchanges or re-pricings without stockholder approval | | | Our Equity Grant Policy sets pre-established grant dates for Executive Team members' annual equity awards | | We do not permit stock option backdating | | | Our Executive Team is employed “at will” | | We do not encourage unreasonable risk taking | | | Our annual cash incentive program includes individual ESG goals | | Our Executive Team is not entitled to single-trigger change-in-control equity acceleration | | | We have adopted a clawback policy consistent with SEC rules and Nasdaq listing standards | | |

  65. We Pay for Performance

    We Pay for Performance Our executive compensation philosophy is to design our compensation programs to be thoughtful and transparent, with a strong focus on pay for performance. We generally target a compensation mix for our executive officers that is weighted heavily toward variable, or “at risk,” compensation, including short-term cash incentives earned based on both Company and individual performance, and long-term equity incentive compensation opportunities. We believe this approach aligns the compensation of our executive officers with our performance and the interests of our stockholders. We consider our equity awards, which in 2023 included restricted stock unit (“RSU”) awards that may be settled for shares of our common stock, and PSU awards where the number of shares earned is determined based on our actual level of performance achieved as measured against the award performance goals, to be “variable” pay because the realized value of these awards depends in large measure on the performance of our stock price.

  66. We Pay all Employees Competitively, Fairly, and Consistently

    As part of our commitment to fair pay practices, we completed our most recent biennial third-party pay equity analysis in 2022. The purpose of this analysis is to look at pay across jobs and levels to ensure our practices are fair and consistent and that compensation is not influenced by gender, race/ethnicity, or the intersection of those dimensions. Our 2022 pay equity analysis found no unexplained pay gaps adverse to women, employees from other marginalized genders, or non-white employees. Additionally, there were no unexplained pay gaps based on intersectionality (i.e., based on the combination of gender and race/ethnicity). We plan to continue to comprehensively audit pay equity biennially with an external consultant, and conduct internal reviews several times a year in conjunction with events such as performance rating and promotion decisions. We also grant equity awards to most employees, to help align the interests of our employees with the long-term interests of our stockholders. We periodically refresh those awards, granting additional equity awards to employees when our Compensation Committee deems it appropriate, in light of market conditions, to replenish unvested equity for retention, to reward performance, and to keep pace with the evolving competitive market. This broad-based equity program is intended to ensure that our employees are invested in, and receive the rewards of, our future success. While we believe it is important to use equity awards to align the interests of our employees with the long-term interests of our stockholders, we are also conscious of the costs associated with, and repurchase shares to offset dilution from, our stock-based compensation. As of December 31, 2023, we had fewer shares outstanding than we did as of December 31, 2017, evidence that our stock repurchase activities have enabled us to effectively mitigate the dilution associated with employee equity.

  67. Annual Cash Incentive Program

    Annual Cash Incentive Program Overview Our annual cash incentive program is intended to reward participants for the achievement of our short-term financial and operational objectives and their individual contributions to meeting those objectives. Annual cash incentive award opportunities set in early 2023 for our Executive Team were based 70% on the achievement of corporate performance objectives and 30% on the achievement of individual performance goals and objectives, except in the case of our CEO, whose annual cash incentive award opportunity was based 80% on the achievement of corporate performance objectives and 20% on the achievement of individual performance goals and objectives, reflecting his greater responsibility for our overall performance. Each Executive Team member’s annual cash incentive award was subject to a maximum payout opportunity equal to 200% of his or her target annual cash incentive award opportunity.

  68. Annual Cash Incentive Program

    | Consideration of ESG Goals | | Our Impact strategy is aligned with our business model. Consistent with this alignment, a portion of the individual performance objectives for each NEO’s 2023 target annual cash incentive opportunity included ESG goals tailored to the NEO's respective business responsibilities. |

  69. Annual Cash Incentive Program

    | 44 | Etsy |

  70. Annual Cash Incentive Program

    Target Annual Cash Incentive Opportunities Our Compensation Committee reviews the target annual cash incentive award opportunities (which are expressed as a percentage of annual base salary) of our executive officers each year as part of its annual executive compensation review and makes adjustments after considering the factors described below in “Factors Considered When Determining Executive Compensation.” Generally, our Compensation Committee seeks to set the target annual cash incentive award opportunities of our Executive Team members so that their target total cash compensation (the sum of their annual base salaries and the target annual cash incentive award opportunities) is at a competitive level with our executive compensation peer group, but does not target a specific percentile. For more information on how our Compensation Committee considers competitive compensation data in making its decisions with respect to the executive compensation, see the section “Factors Considered When Determining Executive Compensation.” Following a review by our Compensation Committee of competitive market data analysis and based on discussions with Compensia, in early 2023, our Compensation Committee approved target annual cash incentive award opportunities as a percentage of annual base salary for each NEO as follows: Mr. Silverman: 120%; Ms. Glaser: 90%; and Ms. Kumar and Ms. Moskowitz: 80%. Additionally, our Compensation Committee approved a target annual cash incentive award opportunity for Mr. Stretch of 70%, prorated based on his start date, as part of his appointment as our Chief Legal Officer and Corporate Secretary. The 2023 target total cash compensation opportunity for each our NEOs was as follows:

  71. Annual Cash Incentive Program

    | | | Cash Incentive Opportunity | | | | | Named Executive Officer | 2023 Base Salary | 2023 Target Opportunity (% of Base Salary) | 2023 Corporate Performance Component Weight* | 2023 Individual Performance Component Weight | Target Total Cash Compensation Opportunity | | Josh Silverman | $660,000 | 120% | 80% | 20% | $1,452,000 | | Rachel Glaser | $525,000 | 90% | 70% | 30% | $997,500 | | Rachana Kumar | $460,000 | 80% | 70% | 30% | $828,000 | | Raina Moskowitz | $475,000 | 80% | 70% | 30% | $855,000 | | Colin Stretch | $460,000 | 70% | 70% | 30% | $782,000 |

  72. Annual Cash Incentive Program

    * As described below, the aggregate corporate performance component was achieved at 129% in 2023; however, based in part on a recommendation from the Executive Team, including the NEOs, and taking into account overall business performance and the Restructuring Plan, our Compensation Committee limited the annual incentive compensation payouts to 50% of target payout opportunity for the CEO and 75% of target payout opportunity for the other NEOs. 2023 Corporate Performance Objectives In early 2023, our Compensation Committee selected consolidated GMS, revenue, and adjusted EBITDA margin as the corporate performance objectives for our 2023 annual cash incentive program, which was consistent with prior years. Our Compensation Committee selected the following metrics, which are key metrics that investors focus on when evaluating Etsy’s performance: •GMS because it believes that it is an indicator of the success of Etsy sellers, the satisfaction of Etsy buyers, the health of our marketplaces, and the scale and growth of our business, and, therefore, is one of our key performance measures. •Revenue and adjusted EBITDA margin because it believes these measures provide a balance between generating revenue, managing our expenses, and growing our business, thereby directly influencing the creation of long-term value for our stockholders. See “Non-GAAP Financial Measures” in this proxy statement for a reconciliation of adjusted EBITDA and adjusted EBITDA margin to net income (loss), the most directly comparable GAAP financial measure. Our Compensation Committee approved performance targets for each performance objective at levels that were designed to capture a range of performance outcomes in 2023, while being realistic and motivating for the participants in our annual cash incentive program, including our NEOs. In recommending the targets that were approved by our Compensation Committee, our Executive Team considered a variety of factors, including a four-year (2019 to 2023) compound annual growth rate comparison, as well as a range of possible scenarios. Target performance for adjusted EBITDA margin was set at 26.0%, lower than the 2022 result, which built in planning for expenses associated with a range of scenarios. If the target performance levels for these metrics were achieved, the 2023 annual cash incentive program would pay out at 100% of target. Performance objectives were subject to a maximum payout level equal to 200%.

  73. Annual Cash Incentive Program

    | 2024 Proxy Statement | 45 |

  74. Annual Cash Incentive Program

    | Performance Measure | Weighting | 2022 Actual Performance | | | Threshold Performance Level (50% Payment of Financial Performance Component) | Target Performance Level (100% Payment of Financial Performance Component) | Stretch Performance Level (200% Payment of Financial Performance Component) | 2023 Actual Performance | | | Weighted Resulting Payout % | | | | | (dollars in millions) | | | | | | | | | | GMS | 40% | | | 13,318 | $12,120 | $13,452 | $14,783 | | | 13,161 | 35% | | Revenue | 30% | | | 2,566 | $2,445 | $2,714 | $2,983 | | | 2,748 | 34% | | Adjusted EBITDA Margin (%) | 30% | | 27.9% | | 24.5% | 26.0% | 27.4% | | 27.4 | | 60% | | | | | | | | | | | Total | | 129% |

  75. Annual Cash Incentive Program

    In March 2024, our Compensation Committee determined our actual performance with respect to the performance objectives for the 2023 annual cash incentive program resulted in an aggregate corporate performance percentage of 129%, based on the achievement of GMS, revenue, and adjusted EBITDA margin as shown in the above table. However, in light of the overall business performance and following the Board’s approval of the Restructuring Plan, our Executive Team recommended that our Compensation Committee limit the annual incentive award payouts to 50% of target payout opportunity for the CEO and 75% of target payout opportunity for the other NEOs. Our Compensation Committee, in exercising its oversight of, and carrying out its responsibilities with respect to, executive compensation matters, considered this recommendation when determining annual cash incentive award payouts and determined to limit 2023 annual cash incentive award payouts accordingly. 2023 Individual Performance Early in the second quarter of 2023, our Compensation Committee reviewed and approved the CEO's goals and objectives for 2023 and reviewed and approved the 2023 goals and objectives recommended by Mr. Silverman for each other Executive Team member. In early March 2024, our Compensation Committee also reviewed each NEO's individual 2023 performance against those goals and objectives. However, in light of the decision to cap 2023 annual incentive awards payouts for the NEOs, the Committee did not award annual cash incentive payouts based on the individual performance factors for each NEO. The following table summarizes select 2023 accomplishments for each NEO.

  76. Annual Cash Incentive Program

    | Named Executive Officer | Select 2023 Achievements | | Josh Silverman | •Under Mr. Silverman’s guidance, Etsy.com continued our product development and return on investment focused marketing efforts to bring new buyers to Etsy, improve buyer retention, and improve the Etsy seller experience, while maintaining a healthy adjusted EBITDA margin. •Mr. Silverman also guided efforts to power our marketplaces' growth and spearheaded revenue growth projects, particularly enhancements to Etsy Ads and our payments platform. •Mr. Silverman remained focused on improving risk management and oversight at Etsy, prioritizing efforts to enhance our risk management program to more clearly define ownership, prioritization, and risk appetites of our key risks. •Mr. Silverman also oversaw our progress towards our sustainability goals, including reducing our Scope 3 emissions. | | Rachel Glaser | •Ms. Glaser continued to guide Etsy's annual operating plan and forecast processes, which establish financial targets and identify and prioritize investments that deliver strong return on invested capital and maximize free cash flow. •Ms. Glaser led efforts to optimize operating margins through operational improvements, restructurings, and other cost optimization initiatives. •Ms. Glaser continued to manage Etsy's capital allocation strategy, which in 2023 returned over 80% of free cash flow to shareholders through share repurchases. •Ms. Glaser led finance teams that continued to deliver on our integrated ESG reporting and implemented a new environmental data management platform to enhance our reporting capacity. |

  77. Annual Cash Incentive Program

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  78. Annual Cash Incentive Program

    | Rachana Kumar | •Ms. Kumar's goals were combined with the goals of our Chief Product Officer. Our engineering and product teams worked together to improve the buying experience on Etsy and to give sellers more agency in their success. •Ms. Kumar oversaw efforts to improve Etsy's ability to leverage machine learning across the organization to improve customer experiences, improve engineering productivity, and make our foundational systems reliable and scalable. •Ms. Kumar also worked to oversee the systems and processes that connect and enable our House of Brands teams and their workflows, as well as protecting the integrity of our information systems. •Ms. Kumar focused on fostering an environment of career growth, community, and equity for our employees. | | Raina Moskowitz | •Ms. Moskowitz led efforts focused on delivering quality services that make buying and selling on Etsy easy, including delivery of incremental annualized GMS, revenue, and efficiency gains. •Ms. Moskowitz led the global expansion of the coverage of our payments platform and expanded trust and safety efforts to uphold marketplace integrity. •Ms. Moskowitz advanced our fulfillment capabilities, introducing machine learning to further improve reliability and speed. •Ms. Moskowitz's also oversaw projects focused on our long-term company strategy and impact, including the achievement of listings with sustainability attributes. | | Colin Stretch | •Mr. Stretch led our legal, compliance, and advocacy functions in providing legal support across the business, prioritizing areas of highest impact, taking into account legal and regulatory trends in emerging risk areas. •Mr. Stretch oversaw efforts to enhance our enterprise risk management program to more clearly define ownership, prioritization, and risk appetites of our key risks. •Mr. Stretch led legal teams that advised on our integrated ESG reporting. |

  79. Annual Cash Incentive Program

    2023 Annual Cash Incentive Award Compensation Decisions In early 2024, our Compensation Committee approved the final cash incentive award payouts which were limited to 50% of target payout opportunity for our CEO and at 75% of target payout opportunity for each other NEO in light of the overall business performance and the Restructuring Plan. As a result, the following payments were approved for 2023:

  80. Annual Cash Incentive Program

    | Named Executive Officer | 2023 Base Salary | 2023 Target Opportunity (% of Base Salary) | 2023 Company Portion | 2023 Individual Portion | 2023 Total Earned (% of Target Opportunity) | 2023 Incentive Cash Compensation | | Josh Silverman | $660,000 | 120% | 129% | —% | 50% | $396,000 | | Rachel Glaser | $525,000 | 90% | 129% | —% | 75% | $354,000 | | Rachana Kumar | $460,000 | 80% | 129% | —% | 75% | $276,000 | | Raina Moskowitz | $475,000 | 80% | 129% | —% | 75% | $285,000 | | Colin Stretch(1) | $460,000 | 70% | 129% | —% | 75% | $212,000 |

  81. Annual Cash Incentive Program

    (1)Mr. Stretch's annual cash incentive award payment was prorated based on his start date of February 14, 2023. Long-Term Incentive Awards Overview We view long-term equity incentive compensation as a critical element of our executive compensation program. We provide long-term equity incentive compensation opportunities to help align the interests of our executive officers, including our NEOs, with the interests of our long-term stockholders. We believe that equity awards encourage long-term focus and decision-making that is consistent with our mission and strategic goals. Typically, we grant equity awards to newly-hired executive officers, in connection with promotions, as a reward for superior performance, and/or for retention purposes. In addition, our NEOs typically receive annual equity awards. Generally, when determining the type and size of an award, our Compensation Committee seeks to be competitive with the companies in our executive compensation peer group, but our Compensation Committee did not target a specific percentile of our peer group in 2023.

  82. Annual Cash Incentive Program

    | 2024 Proxy Statement | 47 |

  83. Annual Cash Incentive Program

    Since 2021, we have included PSUs in the long-term incentive mix for our NEOs. In 2023, our CEO received a mix of PSUs (50%) and RSUs (50%), and the long-term incentive awards for our other NEOs were delivered in a mix of RSUs (70%) and PSUs (30%). PSUs granted to the NEOs in 2023 are earned based on continued service and performance with respect to four equally-weighted metrics selected by our Compensation Committee, described below:

  84. Annual Cash Incentive Program

    | Performance Metric | What it Measures | | GMS (25%) | The dollar value of items sold in our marketplaces, excluding shipping fees and net of refunds, within the applicable period. | | Revenue (25%) | Our revenue (determined on a consolidated basis) reported in Etsy's audited financial statements. | | Adjusted EBITDA Margin (25%) | Etsy’s profitability from our operations that is calculated by dividing consolidated adjusted EBITDA by consolidated revenue and expressed as a percentage. | | Relative TSR (25%) | Our stock price performance, reflecting returns to our stockholders relative to our Nasdaq Composite constituents. |

  85. Annual Cash Incentive Program

    Our Compensation Committee selected these as they are key metrics that investors focus on when evaluating Etsy’s performance: •GMS because it believes that it is an indicator of the success of Etsy sellers, the satisfaction of Etsy buyers, the health of our marketplaces, and the scale and growth of our business, and, therefore, is one of our key performance measures. •Revenue and adjusted EBITDA margin because it believes these measures provide a balance between generating revenue, managing our expenses, and growing our business, thereby directly influencing the creation of long-term value for our stockholders. See “Non-GAAP Financial Measures” in this proxy statement for a reconciliation of adjusted EBITDA and adjusted EBITDA margin to net income (loss), the most directly comparable GAAP financial measure. •Relative TSR because it directly aligns the interests of our executive officers with those of our stockholders. For the PSUs granted in 2023, our Compensation Committee approved a two-year performance period for the GMS, revenue, and adjusted EBITDA margin metrics and a three-year performance period for the relative TSR metric. 2023 Target Long-Term Incentive Opportunities In 2023, our Compensation Committee approved increases to the value of the long-term incentive opportunities granted to Mr. Silverman, Ms. Glaser, and Ms. Moskowitz. These increases were made following the Committee's review and consideration of competitive market data analysis prepared by Compensia and reflected competitive market conditions, as well as the desire to retain Etsy's management team. Our Compensation Committee approved a new hire, long-term incentive opportunity for Mr. Stretch pursuant to the terms of his offer letter and granted in accordance with Etsy's Equity Grant Policy. Additionally, our Compensation Committee approved an equity grant to Ms. Kumar in connection with her promotion to Chief Technology Officer, granted in accordance with Etsy's Equity Grant Policy. The 2023 target long-term incentive equity awards consisted of 50% PSUs and 50% RSUs for Mr. Silverman, and 70% RSUs and 30% PSUs for each other Executive Team member. The following long-term incentive compensation equity awards were granted to our NEOs in 2023.

  86. Annual Cash Incentive Program

    | Named Executive Officer | 2023 Long -Term Incentive Award (Granted Value)(1) | PSUs Granted (#)(2) | RSUs Granted (#)(3) | | Josh Silverman | $17,500,000 | 69,235 | 69,235 | | Rachel Glaser | $8,500,000 | 20,177 | 47,080 | | Rachana Kumar | $7,000,000 | 16,616 | 38,128 | | Raina Moskowitz | $7,000,000 | 16,616 | 38,771 | | Colin Stretch | $7,000,000 | 16,616 | 36,501 |

  87. Annual Cash Incentive Program

    (1)Reflects grant values as approved by our Compensation Committee. Pursuant to our Equity Grant Policy, to mitigate the impact of any short-term stock price volatility, the target number of PSUs and number of RSUs subject to an award was determined by dividing the aggregate granted value of the award by the average closing market price of our common stock on Nasdaq (rounded to the nearest hundredth) for the 30 trading days immediately prior to and including the date of grant. The dollar value in this column will vary from the value of awards as reflected in the Summary Compensation Table and the Grants of Plan-Based Awards Table, which are required to be computed in accordance with FASB ASC Topic 718, based on the closing market price of our common stock on Nasdaq on the grant date and the probable outcome of the applicable performance conditions for the PSUs based on GMS, revenue, and adjusted EBITDA margin, and using a Monte-Carlo simulation model for the PSUs based on relative TSR. (2)The number of shares to be earned under the PSUs based on GMS, revenue, and adjusted EBITDA margin objectives will be based on our actual level of performance achieved during a two-year performance period from January 1, 2023 through December 31, 2024 and for the PSUs based on relative TSR will be based on a three-year performance period from January 1, 2023 through December 31, 2025. 50% of the PSUs earned based on achievement of the GMS, revenue, and adjusted EBITDA margin performance conditions for the two-year performance period will vest on each of April 1, 2025, and April 1, 2026, subject to continued service through the applicable vesting date. 100% of the PSUs earned based on relative TSR for the three-year performance period will vest on April 1, 2026, subject to continued service through that date. The number of shares that may be earned will range from 0% to 200% of the target number of PSUs specified in the above table.

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  89. Annual Cash Incentive Program

    (3)The RSUs vest in eight equal semi-annual installments beginning on October 1, 2023, other than Mr. Stretch's RSUs which vested as to 25% on April 1, 2024, with the balance vesting every six months over the next three years, subject to his continued employment with Etsy, and Ms. Kumar's promotion equity grant award of 32,590 RSUs granted on February 1, 2023 and included in the above table, which vest in eight equal semi-annual installments beginning on April 1, 2023, subject to her continued employment with Etsy. Long-Term Incentives Earned from 2021 PSU Awards In 2021, our Compensation Committee granted PSUs to Mr. Silverman, Ms. Glaser, and Ms. Moskowitz with four equally weighted performance metrics: GMS; revenue; adjusted EBITDA margin; and relative TSR. The GMS, revenue, and adjusted EBITDA margin performance metrics were tied to our fiscal year 2023 results and set at levels designed to capture a range of performance outcomes, as set forth below. For the relative TSR metric, our Compensation Committee approved a performance target based on our relative TSR performance during the three-year performance period ending December 31, 2023.

  90. Annual Cash Incentive Program

    | Performance Measure | Weighting | Threshold Performance Level | Target Performance Level | Stretch Performance Level | 2023 Actual Performance(1) | Payout % | Weighted Resulting Payout % | | | | (dollars in millions) | | | | | | | GMS | 25% | $14,300 | $15,800 | $18,300 | $12,520 | —% | —% | | Revenue | 25% | $2,450 | $2,700 | $3,200 | $2,653 | 91% | 23% | | Adjusted EBITDA Margin | 25% | 28.0% | 30.7% | 31.3% | 29.2% | 72% | 18% | | Relative TSR | 25% | 25th %ile | 50th %ile | 85th %ile | 38.95th %ile | 78% | 19% | | | | | | | | Total | 60% |

  91. Annual Cash Incentive Program

    (1)The Committee determined to approve achievement based on the performance of the Etsy and Reverb marketplaces only, consistent with the basis used to set the performance objectives in 2021, which objectives were set prior to our acquisitions of Depop and Elo7. In March 2024, our Compensation Committee determined our actual performance relative to the performance objectives resulted in 60% of the PSUs granted being earned as shown in the above table. This resulted in the following number of PSUs earned by our NEOs.

  92. Annual Cash Incentive Program

    | Named Executive Officer(1) | 2021 PSUs Granted at Target | 2021 PSUs Earned Based on Performance Objectives (#)(2) | | Josh Silverman | 114,836 | 69,163 | | Rachel Glaser | 5,741 | 3,458 | | Raina Moskowitz | 4,306 | 2,594 |

  93. Annual Cash Incentive Program

    (1)Ms. Kumar and Mr. Stretch did not receive 2021 PSU grants. (2)60% of the PSUs based on GMS, revenue, and adjusted EBITDA margin objectives were earned based on our fiscal year 2023 results and a three-year performance period from January 1, 2021 through December 31, 2023 for PSUs based on relative TSR. One-half of the earned PSUs vested on April 1, 2024, and one-half will vest on April 1, 2025, subject to continued service through each vesting date. 2024 Target Long-Term Incentive Opportunities In response to favorable feedback from our stockholders regarding the inclusion of PSUs in our executive compensation program, our Compensation Committee retained PSUs as part of our 2024 equity awards. In early 2024, our Compensation Committee approved performance targets for the GMS, revenue, and adjusted EBITDA margin performance objectives that must be achieved in order to earn the PSUs granted in 2024 that are tied to performance over the two-year period ending December 31, 2025 and set at levels that are designed to capture a range of performance outcomes. For the relative TSR metric, our Compensation Committee approved a performance target based on our relative TSR performance during the three-year performance period ending December 31, 2026. Our Compensation Committee approved annual refresh equity awards consisting of 50% RSUs and 50% PSUs for Mr. Silverman, and for each other Executive Team member, equity awards consisting of 70% RSUs and 30% PSUs.

  94. Annual Cash Incentive Program

    | 2024 Proxy Statement | 49 |

  95. Annual Cash Incentive Program

    How We Determine Executive Compensation Role of our Compensation Committee Our Compensation Committee discharges the responsibilities of our Board relating to the compensation of our executive officers, including our NEOs. Specifically, our Compensation Committee: •Is responsible for executive compensation decisions, including reviewing, evaluating, and approving the compensation arrangements, plans, policies, and practices for our CEO and, in consultation with our CEO, our other executive officers (including our NEOs), and overseeing and administering our incentive compensation plans, provided that it may delegate to a subcommittee of two or more directors the authority to grant equity awards under our equity plans, or delegate to two or more officers or directors the authority to grant equity awards to employees who are not senior officers; •Oversees risk management of our compensation programs, policies, and practices, including an annual review of our programs to ensure that they are not reasonably likely to incentivize employee behavior that would result in any material adverse risk to us; and •Has sole authority to continue or terminate its relationship with outside advisors, including its compensation consultant, and retain additional outside advisors. Role of Chief Executive Officer To discharge its responsibilities, in 2023 our Compensation Committee worked with members of our management, including our CEO and our Chief Human Resources Officer. Management assists our Compensation Committee by providing information on corporate and individual performance and management’s perspective on compensation matters. Our Compensation Committee solicits and reviews our CEO’s recommendations with respect to the compensation of our Executive Team members (other than himself), based on his consideration of relevant market data, roles and responsibilities, and individual performance. Our Compensation Committee reviews and discusses these recommendations with our CEO and considers them as one factor in approving the compensation for our executive officers, including our NEOs. Our CEO recuses himself from all discussions and recommendations regarding his own compensation and is not present when his compensation is determined. Role of the Compensation Consultant Our Compensation Committee engages an external compensation consultant to assist it by providing information, analysis, and other advice relating to our executive compensation program and the decisions made as part of its annual executive compensation review. Our Compensation Committee has engaged Compensia as its compensation consultant since 2014 to advise on executive compensation matters, provide information on competitive market pay practices for senior executives, and supply data analysis and recommendations for the selection of our executive compensation peer group. For 2023, Compensia’s engagement included: •the review and analysis of the compensation for our executive officers, including our NEOs, as well as an analysis of the mix of compensation elements and the terms included in our forms of equity compensation award agreements; •the research, review, and updating of our executive compensation peer group; •an assessment of our equity usage and burn rate compared to our peers; •the review and analysis of non-employee director compensation compared to market practices; •summarizing market trends and regulatory and governance updates; •the review of and input on the Compensation Discussion and Analysis section of our proxy statement; •attendance at Compensation Committee meetings as requested; and •support on other ad hoc matters throughout the year. Compensia reports directly to our Compensation Committee. In 2023, Compensia did not provide any other services to Etsy. Our Compensation Committee evaluates Compensia’s independence annually and has determined that under the applicable SEC rules and Nasdaq listing standards its relationship with Compensia and the work of Compensia on behalf of our Compensation Committee have not raised any conflict of interest.

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  97. Annual Cash Incentive Program

    Factors Considered When Determining Executive Compensation When approving each compensation element and the target total direct compensation opportunity for our Executive Team members, including our NEOs, our Compensation Committee considers a variety of factors that provide the framework for compensation decision-making and final decisions regarding the compensation opportunity for each executive officer. No single method or factor is determinative in setting pay levels for our executive officers. Rather, our Compensation Committee’s determination of the target total direct compensation, fixed, and “at-risk” pay opportunities was an individualized decision for each executive officer, including each NEO.

  98. Annual Cash Incentive Program

    | Scope & Impact of Role | Individual & Company Performance | Market Analysis | | Each executive officer’s skills, experience, and qualifications relative to similarly-situated executives at our peer companies. | Our Company performance against financial and operational objectives established by our Compensation Committee and our Board. | The positioning of each executive officer’s compensation in a ranking of peer company compensation levels, or in comparison to a compensation database where there are insufficient data points in our compensation peer group. | | Our CEO’s recommendations (other than for himself) considering performance, a competitive market analysis, and compensation parity among our executive officers. | Each executive officer’s performance, based on an assessment of his or her contribution to our overall performance, including effective contribution to the achievement of ESG goals, and his or her ability to lead and work as part of a team. | The compensation practices of our executive compensation peer group, and the scope of each executive’s role compared to similarly-situated executives at our peer companies. |

  99. Annual Cash Incentive Program

    Competitive Positioning Competitive compensation data is one of several factors that our Compensation Committee considers in making its decisions with respect to the compensation of our Executive Team, including our NEOs. Specifically, our Compensation Committee considers compensation data in our competitive market for executive talent, particularly the compensation levels and practices of a group of peer companies (the “Compensation Peer Group”), as determined by our Compensation Committee. Our Compensation Peer Group consists of companies in our industry (consumer discretionary, consumer staples, and information technology) that are similar to us in terms of revenue and market capitalization. Our Compensation Committee reviews our Compensation Peer Group at least annually and adjusts its composition, if warranted, taking into account changes in both our business and the businesses of the companies in the Compensation Peer Group. Specifically, in determining the Compensation Peer Group for 2023, our Compensation Committee considered whether a company was: •in a similar industry (focusing on companies in the consumer discretionary, consumer staples, and information technology industries and with a preference for companies with business models focusing on peer-to-peer commerce, transaction- or subscription-based revenue models, services and/or e-commerce, and software as a service); •within a range of 0.5x to 2.0x of our revenue; and •within a range of 0.33x to 3.0x of our 30-day average market capitalization at the time of analysis. Based on these criteria and after considering a recommendation from Compensia, in December 2022, our Compensation Committee approved adjustments to our Compensation Peer Group to remove MercadoLibre and Stitch Fix (based on the criteria described above) and Twitter and Zendesk (which were acquired) and to add Roblox (using the criteria described above). This resulted in the following Compensation Peer Group for 2023 for the compensation for our NEOs:

  100. Annual Cash Incentive Program

    | ANGI Homeservices DocuSign DoorDash Dropbox eBay | GoDaddy HubSpot Match Group Okta Peloton Interactive | Pinterest RingCentral Roblox Shopify Snap | The Trade Desk Tripadvisor Twilio Wayfair Zillow Group |

  101. Annual Cash Incentive Program

    Further, our Compensation Committee uses data drawn from our Compensation Peer Group, as well as data from the Radford Global Compensation Database for positions where there are insufficient data points in the Compensation Peer Group data, to evaluate the competitive market when making executive compensation determinations, including base salary, target annual cash incentive opportunities, and long-term incentive compensation opportunities in the form of equity awards. In December 2023, our Compensation Committee approved updates to the Compensation Peer Group for 2024 to remove Shopify and The Trade Desk and to add IAC and Yelp, based on the above-described criteria.

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  103. Annual Cash Incentive Program

    Other Benefits We believe the best work comes from happy employees. We offer all our employees a robust benefit package designed to support employee retention and engagement. Health & Wellness We provide health and wellness benefits to our executive officers, including our NEOs, on the same basis as these benefits are provided to our other eligible employees, including health, dental, fitness, vision, life, and disability insurance benefits. Etsy is also recognized for leading in gender-neutral paid parental leave, adoption assistance, family planning benefits, and back up childcare programs. 401(k) Plan Like our other U.S. employees, our NEOs may participate in our 401(k) Plan. Etsy matches 50% of the first 6% of each participating employee’s contributions under our 401(k) Plan. Perquisites and Other Personal Benefits Perquisites, beyond those that are available to employees generally, represent a small part of our executive compensation program. From time to time, however, we may provide perquisites or other personal benefits that our Compensation Committee has determined are reasonable yet competitive to attract and retain our executive officers, including our NEOs. Perquisites in 2023 consisted of security services for Mr. Silverman and Ms. Moskowitz. In addition, Ms. Glaser and Mr. Stretch each received a monthly stipend for travel from Los Angeles and Washington, D.C., respectively. In connection with Ms. Kumar's international assignment in Mexico City for Etsy business purposes, Etsy provided housing and housing-related expenses, ground transportation, school tuition for her children, a tax gross up, tax equalization, and tax preparation services. For more information regarding the perquisites or other personal benefits that our NEOs received during 2023, see the column titled “All Other Compensation” of the 2023 Summary Compensation Table and the accompanying footnotes. Post-Employment Compensation Arrangements We believe that having in place reasonable and competitive post-employment compensation arrangements are essential to attracting and retaining highly-qualified executive officers and we maintain an executive severance plan for that purpose. Maintaining competitive severance and change in control arrangements helps assure our executive officers that their severance payments and benefits are comparable to those of other executive officers with similar levels of responsibility and tenure. We also believe that the executive severance plan serves as an incentive for our executive officers to remain employed and focused on their responsibilities during the threat or negotiation of a transaction that may involve a change in control of the company, which helps preserve our value and the potential benefit to be received by our stockholders in such a transaction. We also added a “retirement provision” to our equity awards granted on or after March 15, 2023. None of our NEOs were retirement eligible in 2023. In addition, the executive severance plan and the retirement provisions in our equity awards are intended to reduce the need to extensively negotiate post-employment compensation arrangements on a case-by-case basis and to help mitigate potential employer liability. For example, executive severance plan participants are required to sign a separation and release agreement (including a release in favor of Etsy) as a condition to receiving post-employment compensation payments or benefits. See “Executive Compensation Tables – Potential Payments Upon Termination or Change of Control” below for additional information. Other Compensation Policies and Practices Equity Awards Grant Policy We maintain a formal equity awards grant policy, which has been adopted by our Compensation Committee. Our Equity Awards Grant Policy provides: •Our Board, our Compensation Committee, or a subcommittee of two or more directors must approve all equity awards granted to senior officers. Our Compensation Committee may also delegate its authority to grant awards to employees other than senior officers to two or more officers or directors, as our Compensation Committee deems appropriate. •Unless otherwise approved by our Board or our Compensation Committee, equity awards are granted on pre-established dates as follows: •For newly-hired and promoted employees, awards are effective on the first business day of the month immediately following the month in which a newly-hired employee’s employment commences or a promoted employee’s promotion occurs (or, if that day is not a trading day, on the following trading day). •Annual equity awards granted to our employees, including our executive officers, are effective as of March 15th of each year (or, if that day is not a trading day, on the following trading day).

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  105. Annual Cash Incentive Program

    •In order to mitigate the impact of any short-term stock price volatility on the number of stock units granted, the number of stock units in a RSU or PSU award is based on the aggregate dollar value of the award divided by the average closing market price of our common stock on Nasdaq (rounded to the nearest hundredth) for the 30 trading days immediately prior to and including the date of grant, or based on such other methodology as our Compensation Committee may determine in its sole discretion. As a result, the grant date fair value of the awards, computed in accordance with FASB ASC Topic 718 and presented in the Summary Compensation Table and Grants of Plan-Based Awards Table, may be lower or higher than the equity compensation value approved by our Compensation Committee. Stock Ownership Guidelines To support continued alignment of the interests of our non-employee directors and executive officers with the interests of our stockholders, our stock ownership guidelines require our executive officers and the non-employee members of our Board to own a minimum number of shares of our common stock. Under our guidelines, these individuals are required to hold shares of our common stock equivalent in value to a multiple of their base salaries or a minimum dollar amount or to hold a minimum number of shares as set forth below:

  106. Annual Cash Incentive Program

    | Individual Subject to Ownership Guidelines | Minimum Required Level of Stock Ownership | | Chief Executive Officer | Lesser of six times base salary or 37,800 shares | | Other Executive Officers | Lesser of one times base salary or 4,400 shares | | Non-Employee Members of our Board | Lesser of $150,000 or 1,500 shares |

  107. Annual Cash Incentive Program

    The ownership level specified by the guidelines must be achieved by each non-employee director and executive officer by the end of the calendar year that is five years after April 12, 2022 (the date the guidelines were adopted), or, if later, within five years of first becoming one of our directors or executive officers (or being promoted to chief executive officer), measured as of the last day of the applicable fiscal year (the “measurement date”). For the executive officers, the required ownership level is calculated using the executive officer’s annual base salary as of January 1 of the year of the measurement date. The following shares of our common stock count toward compliance with the guidelines: •shares owned outright by the director or executive officer or by members of his or her immediate family; •shares held in a trust for the benefit of the director or executive officer and/or members of his or her immediate family; and •vested RSUs, including vested PSUs, net of the estimated number of shares needed to pay the minimum tax withholding for those vested units. Unvested RSUs and unexercised stock options (whether or not vested) do not count toward director or executive officers’ compliance with the guidelines. These shares are valued at the average daily closing price per share of our common stock during the 90-trading day period ending 30 days prior to the measurement date. If the guidelines have not been met by the initial compliance date, the executive officers are required to retain 50% of any shares acquired under any equity award granted by Etsy (net of any shares sold or withheld to pay any applicable exercise price or satisfy any employment or income taxes related to the equity awards) until the stock ownership guidelines are met. The ownership levels of our named executive officers and non-employee directors as of April 1, 2024 are set forth in the section entitled “Security Ownership of Certain Beneficial Owners, Directors, and Management.” Clawback Policy We have adopted a clawback policy consistent with SEC rules and Nasdaq listing standards. The policy provides for the recoupment of certain incentive compensation from current or former executive officers in the event of a financial restatement, as defined in the policy. A copy of the policy is filed as Exhibit 97 to our Form 10-K. Policy Prohibiting Hedging and Pledging Under our insider trading policy, our employees, including our executive officers, and the non-employee members of our Board are prohibited from engaging in short sales, hedging or similar transactions, or derivatives trading involving our equity securities. Similarly, under our insider trading policy, our employees, including our executive officers, and the non-employee members of our Board are prohibited from pledging our equity securities or using such securities as collateral for a loan.

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  109. Annual Cash Incentive Program

    Compensation and Risk Management Our Compensation Committee, Compensia, and our management team each play a role in evaluating and mitigating potential risks associated with our compensation program, practices, and policies. Our Compensation Committee, with input and support from Compensia and management, has performed a compensation risk assessment. In particular, this assessment considered compensation program attributes that help to mitigate risk, including, for example: •the mix of cash and equity compensation; •a balance of short and long-term incentive plan designs with multiple performance measures that emphasize top and bottom-line performance; •our formal policies for equity administration; •our insider trading policy, which prohibits short sales, hedging or similar transactions, derivatives trading and pledging and using our securities as collateral; •our Clawback Policy; •our stock ownership guidelines; and •the oversight of an independent Compensation Committee. Based on this assessment, our Compensation Committee concluded that our compensation policies and practices, taken as a whole, are not reasonably likely to have a material adverse effect on Etsy. Tax and Accounting Considerations Deductibility of Executive Compensation Under Section 162(m) of the Internal Revenue Code, compensation paid to each of our “covered employees” that exceeds $1 million per taxable year is generally non-deductible unless the compensation qualifies for certain grandfathered exceptions (including the “performance-based compensation” exception) for certain compensation paid pursuant to a written binding contract in effect on November 2, 2017 and not materially modified on or after such date. Although our Compensation Committee will continue to consider tax implications as one factor in determining executive compensation, our Compensation Committee also looks at other factors in making its decisions and retains the flexibility to provide compensation for our executive officers in a manner consistent with the goals of our executive compensation program and the best interests of Etsy and our stockholders, which may include providing for compensation that is not deductible by us due to the deduction limit under Section 162(m). Taxation of Non-Qualified Deferred Compensation Generally, Section 409A of the Internal Revenue Code sets limits on the deferral and payment of certain benefits. Our Compensation Committee takes into account whether elements of the compensation for our executive officers will be adversely impacted by the penalty tax imposed by Section 409A, and seeks to structure these elements to be compliant with or exempt from Section 409A to avoid such potential adverse tax consequences. Accounting Our Compensation Committee considers the accounting treatment of the various elements of our executive compensation program. We follow the FASB ASC Topic 718 for our stock-based compensation awards. FASB ASC Topic 718 requires us to measure the compensation expense for all stock-based payment awards made to our employees, including our executive officers, and the non-employee members of our Board, including stock options and other stock awards, based on the grant date “fair value” of these awards. This calculation is performed for accounting purposes and reported in the executive and director compensation tables in this proxy statement, even though the recipient of the awards may never realize any value from the awards.

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  111. Annual Cash Incentive Program

    Compensation Committee Report Our Compensation Committee has reviewed and discussed with management the foregoing Compensation Discussion and Analysis section of Etsy’s Proxy Statement for the 2024 Annual Meeting of Stockholders. Based on this review and discussion, our Compensation Committee has recommended to our Board that the Compensation Discussion and Analysis be included in Etsy’s 2024 Proxy Statement and incorporated into Etsy’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023. Respectfully submitted by: Melissa Reiff (Chair) C. Andrew Ballard Jonathan D. Klein

  112. Annual Cash Incentive Program

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  113. Annual Cash Incentive Program

    Executive Compensation Tables Summary Compensation Table The following table provides information regarding the compensation of our NEOs as of December 31, 2023, 2022, and 2021 in accordance with SEC rules.

  114. Annual Cash Incentive Program

    | Name and Principal Position | Year | Salary ($)(1) | Bonus ($) | Stock Awards ($)(2) | Option Awards ($)(3) | Non-Equity Incentive Plan Compensation ($)(4) | All Other Compensation ($)(5) | Total ($) | | Josh Silverman President & CEO | 2023 | 652,603 | — | 15,483,730 | — | 396,000 | 44,771 | 16,577,104 | | | 2022 | 622,500 | — | 15,410,262 | — | 416,000 | 12,745 | 16,461,507 | | | 2021 | 600,000 | — | 35,273,412 | 3,599,940 | 1,099,000 | 11,940 | 40,584,292 | | Rachel Glaser Chief Financial Officer | 2023 | 512,671 | — | 7,330,247 | — | 354,000 | 84,900 | 8,281,818 | | | 2022 | 468,750 | — | 7,498,440 | — | 263,000 | 54,150 | 8,284,340 | | | 2021 | 443,750 | — | 4,049,928 | 1,249,973 | 609,000 | 8,700 | 6,361,351 | | Rachana Kumar Chief Technology Officer | 2023 | 455,069 | — | 7,104,604 | — | 276,000 | 276,050 | 8,111,723 | | Raina Moskowitz Chief Operating and Marketing Officer | 2023 | 462,671 | — | 6,036,517 | — | 285,000 | 35,665 | 6,819,853 | | | 2022 | 416,250 | — | 5,623,794 | — | 219,000 | 9,150 | 6,268,194 | | Colin Stretch(6) Chief Legal Officer and Corporate Secretary | 2023 | 404,548 | 150,000 | 6,292,980 | — | 212,000 | 87,600 | 7,147,128 |

  115. Annual Cash Incentive Program

    | Year | Summary Compensation Table Total for CEO ($) | Compensation Actually Paid to CEO ($)(1)(2) | Average Summary Compensation Table Total for Other NEOs ($)(3)(4) | Average Compensation Actually Paid to Other NEOs ($)(2)(4) | Value of Initial Fixed $100 Investment Based On: | | Net Income ($ in millions) (6) | Revenue ($ in millions) (7) | | | | | | | Total Shareholder Return ($) | Peer Group Total Shareholder Return ($)(5) | | | | 2023 | 16,577,104 | 5,868,843 | 7,590,131 | 3,947,292 | 182.96 | 146.96 | 308 | 2,748 | | 2022 | 16,461,507 | (15,823,299) | 7,261,266 | (4,534,407) | 270.38 | 118.03 | (694) | 2,566 | | 2021 | 40,584,292 | 52,367,686 | 5,850,887 | 11,909,053 | 494.22 | 148.30 | 494 | 2,329 | | 2020 | 1,934,307 | 102,473,221 | 3,496,282 | 28,464,462 | 401.60 | 118.87 | 349 | 1,726 |

  116. Annual Cash Incentive Program

    | Adjustments to Determine CEO Compensation Actually Paid | 2023 | | Summary Compensation Table (SCT) amount | 16,577,104 | | Less Amounts Reported under “Stock Awards” Column in SCT for the Covered Year | (15,483,730) | | Plus Year-end Fair Value of Stock Awards and Options Awards Granted during Covered Year that Remain Unvested as of Year-end | 12,376,937 | | Plus Fair Value on Vesting of Awards Granted during Covered Year that Vest during Covered Year | 558,875 | | Change (positive or negative) in Fair Value from Prior Year-end to Covered Year-end of Awards Granted Prior to Covered Year that were Outstanding and Unvested as of Covered Year-end | (7,402,227) | | Change (positive or negative) in Fair Value from Prior Year-end to Vesting Date of Awards Granted Prior to Covered Year that Vested during Covered Year | (758,116) | | TOTAL ADJUSTMENTS: | (10,708,261) | | TOTAL COMPENSATION ACTUALLY PAID: | 5,868,843 |

  117. Annual Cash Incentive Program

    | Adjustments to Determine Average Other NEO Compensation Actually Paid | 2023 | | Summary Compensation Table (SCT) amount | 7,590,131 | | Less Amounts Reported under “Stock Awards” Column in SCT for the Covered Year | (6,691,087) | | Plus Year-end Fair Value of Stock Awards and Options Awards Granted during Covered Year that Remain Unvested as of Year-end | 4,743,190 | | Plus Fair Value on Vesting of Awards Granted during Covered Year that Vest during Covered Year | 363,561 | | Change (positive or negative) in Fair Value from Prior Year-end to Covered Year-end of Awards Granted Prior to Covered Year that were Outstanding and Unvested as of Covered Year-end | (1,285,730) | | Change (positive or negative) in Fair Value from Prior Year-end to Vesting Date of Awards Granted Prior to Covered Year that Vested during Covered Year | (772,773) | | TOTAL ADJUSTMENTS: | (3,642,839) | | TOTAL COMPENSATION ACTUALLY PAID: | 3,947,292 |

  118. Discussion of Compensation Actually Paid

    Discussion of Compensation Actually Paid As reflected in the tables above, changes in the market price of our common stock following the date of grant of an award can have a significant impact on the disclosure of “compensation actually paid” to our NEOs, as calculated pursuant to the SEC rules. Etsy grew significantly during 2020 as millions of buyers found Etsy for the first time, or discovered Etsy again. At the same time, Etsy’s stock price increased from $44.30 per share on December 31, 2019 to $177.91 per share on December 31, 2020, which significantly increased the intrinsic value of the options our CEO was granted in 2017. Further, the timing of equity awards may also unintentionally impact the “compensation actually paid” as calculated pursuant to the rule. Because of the structure of the front-loaded equity award that Mr. Silverman received when he became our CEO in 2017, he approached 2021 with almost no unvested equity. Mr. Silverman received a performance-based equity award in 2021 with an aggregate grant date value of $25 million which was intended to retain, incentivize, and motivate him for the next four years, drive Etsy's long-term growth, and promote the alignment of CEO compensation with long-term stockholder value creation. The “compensation actually paid” attributed to this award, as well as the remaining unvested 2017 options, also increased as a result of the continued strong performance of Etsy's stock price in 2021 and decreased in 2022 and 2023 as Etsy's stock price declined. To assist in understanding these changes in value, the following table shows the closing price for one share of our common stock as of the last trading day of the year preceding the initial Covered Year and each Covered Year:

  119. Discussion of Compensation Actually Paid

    | | 2019 | 2020 | 2021 | 2022 | 2023 | | Closing Market Price of our Common Stock as of December 31 | $44.30 | $177.91 | $218.94 | $119.78 | $81.05 |

  120. Discussion of Compensation Actually Paid

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  121. Discussion of Compensation Actually Paid

    The graph below illustrates the total shareholder return on a fixed $100 investment made as of market close on December 31, 2019 in shares of Etsy common stock and in the Russell 1000 Index, our peer group. Etsy stock price has experienced volatility during the four-year period illustrated below, with large gains during 2020 and 2021 as our business had significant growth during the pandemic, followed by price decreases as revenue growth slowed and GMS held roughly steady during 2022 and 2023. That said, an investment in shares of Etsy common stock outperformed an investment in the Russell 1000 during the four-year period ended December 31, 2023. Set forth below are charts illustrating the relationship between (a) the compensation actually paid to our CEO and (b) the average compensation actually paid to our Other NEOs during each Covered Year and each of: •Etsy’s revenue for each Covered Year; •Etsy’s net income (loss)(1) for each Covered Year; and •Etsy’s cumulative TSR(2) each Covered Year.

  122. Discussion of Compensation Actually Paid

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  123. Discussion of Compensation Actually Paid

    (1)Net income (loss) is not a metric used by Etsy to determine executive compensation and therefore any relationship between compensation actually paid and net income (loss) is likely as a result of our including adjusted EBITDA, a non-GAAP financial measure that represents our net

  124. Discussion of Compensation Actually Paid

    | 2024 Proxy Statement | 65 |

  125. Discussion of Compensation Actually Paid

    income (loss) adjusted to exclude: interest and other non-operating (income) expense, net; (benefit) provision for income taxes; depreciation and amortization; stock-based compensation expense; foreign exchange loss; acquisition, divestiture, and corporate structure-related expenses; asset impairment charges; loss on sale of business; and restructuring and other exit costs, and adjusted EBITDA margin (adjusted EBITDA divided by revenue) as key metrics in our compensation program during the relevant period. For a reconciliation of Net income (loss) to adjusted EBITDA see “Non-GAAP Financial Measures.” (2)In 2021, we added relative TSR (a measure reflecting returns to our stockholders relative to the Nasdaq Composite constituents) over a three-year performance period to the mix of performance metrics used in our compensation program. The initial performance period expired at the end of 2023 and therefore is not a direct contributor to any correlation shown in the chart above for periods prior to 2023.