What’s the best way to create your marketplace strategy?

David Beisel (Co-Founder & Partner at NextView Ventures)
Start Your Marketplace Engines – GenuineVC

As a general rule, once a true market is going, I’ve observed that the supply-side often increases in step-functions, while the demand-side grows incrementally

Simon Rothman (Partner @ Greylock Partners)
How To Structure A Marketplace | TechCrunch

The first marketplace to reach liquidity wins. But what is liquidity? Liquidity is the reasonable expectation of selling something you list or finding what you’re looking for. It isn’t an exact science. Some guidelines: A conversion range of 30-60% is a reasonable expectation. The higher your average selling price, the lower the conversion rate may be. The harder it is to find a good elsewhere, the lower the conversion rate may be. Price dispersi… (read more)

Simon Rothman (Partner @ Greylock Partners)
How To Structure A Marketplace | TechCrunch

For every aspect of the marketplace, ask: does the user do the work or does the platform do the work?
If the user does the work, it’s decentralized. If the platform does the work, it’s centralized. At a high level, decentralization gives you speed, but the cost is an inconsistent and possibly poor user experience.

David Beisel (Co-Founder & Partner at NextView Ventures)
Start Your Marketplace Engines – GenuineVC

I’ve observed a couple of strategies and approaches for overcoming cold-start inertia: 1. Offer supply side value for being present beyond just buyers 2. Attract would-be buyers with research/learning about purchasing… suppliers will follow 3. Attract would-be buyers with research/learning about purchasing… suppliers will follow 4. Piggyback off an existing marketplace. 5. Develop/leverage meaningful relationships so sellers are patient during an… (read more)