Can anyone explain a little more how it works?

This is Katherine - Co-Founder of ShopLocket. Basically you go in and create a product (name, price description, photos) and connect any PayPal email address and you're ready to publish. We give you a link to where your product is hosted and you can also embed your product into any web page or blog post using the iFrame we provide. Note that more payment options are coming soon.

How does this differ in practice from Etsy? I see you can embed it into another site, but are there any other advantages or differences in typical usage, like fee structure, searchability, and so forth?

Its a lot easier to get started with ShopLocket than with something like Etsy and the ability to select a style and embed it on your own site is a big plus. We plan to add custom CSS to widgets in the coming months, which should make widgets even more appealing.

Also on Etsy you still have a "store", and it only makes sense for certain categories of products. We're all about putting your products in front of your audience and the people that matter, rather than you just being another product in a generic marketplace. We want to create the ideal "display case" — a platform as awesome as the products people are selling.

Thanks Katherine! FYI: I am creating a start up coming up next month and I think it will be beneficial for your company to add your site as a partner because it will help you out to get way more traffic

Cool! Shoot me an email katherine [at] shoplocket.com :)

I think your idea is awesome! I always believe in those "step removing" ideas.