Etsy has somewhere on the order of 100 million active buyers, searching Etsy for goods to buy every month. If you set up a storefront on Square, you start out with 0 active buyers, searching your storefront 0 times every month. Marketplaces bring tremendous value to small sellers.
So... Let me get this straight - they get a lot of customers off other people's work, but aren't willing to pay for the increased costs of providing them those extra customers.
