They seem to be another site in the same vein as Tindie etc, but I've never heard of them despite being right in their target market (aside from not being in the US/Canada, which isn't usually an obstacle to hearing about US-only stuff) and despite following most of the avenues where something like this would usually be mentioned.
Re: that article, I'm not sure how to reconcile "We can do it with or without you" with the rumored price of several million dollars. Unless the talent alone was worth the price of acquisition.
Amanda here, Grand St. co-founder. Jason's story is factually incorrect on a few things. To be clear: no threats were ever made or implied in deal meetings. Etsy is one of the most genuine and good-natured companies I have ever encountered.