Shares of Etsy, an online marketplace for handmade goods and craft supplies, more than doubled in their debut on 16 April, valuing the company at about $3.88bn (£2.59bn).

The company's initial public offering of about 16.7 million shares raised about $267m , after it was priced at the top end of the expected range of $14-$16.

Founded in 2005 by Robert Kalin, Etsy has grown from a website selling just wooden goods to an online community where crafters and artists offer handmade and vintage goods.

Etsy, which has 29 million items listed on its website, offers jewellery, stationery, clothing, home goods, craft supplies and vintage items.

"It is a leading online operator of handmade and vintage goods, including jewelry, furniture, clothing. No other company has been able to create this kind of community. And it's a very loyal community.

"Mostly women. And in the prospectus, they will tell you that about half of the buyers and sellers in 2011 were buyers and sellers in 2014," said Kathleen Smith, principal at Renaissance Capital.

The company's revenue comes from listing fees and commissions on sales as well as from its advertising platform, payment processing and shipping services. Etsy had 1.4 million active sellers and 19.8 million active buyers as of December.

"The company has really increased its spending on marketing, figuring that it has such a loyal client base that it's worth paying more to keep attracting clients.

"The growth rate is pretty good, over 50 percent at the end of the year and its looks like they can get this 30% type of growth.

"But the key issue is can this company scale with this craft community and not kind of sell out to the type of business that Amazon does or eBay, where it's basically manufactured goods that are on the site.

"And that is where they will not distinguish themselves," added Smith.

The global online retail market is expected to grow about 17% to $1.5tn between 2013 and 2018, according to consumer market research firm Euromonitor.

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