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Hello, My Name is Josh

Marketplace Checklist
 Provides productivity gains
 Massive existing (inefficient) market
 High fragmentation
 In the payment flow
 Frequency (recurrence) of usage
 Irregular / non-monagamous usage
 Standardization possibilities
 Network effects on quality, cost, speed
 Market expansion (unlock new supply / dem
and)
 No disintermediation possible

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Horizontal vs Vertical
Horizontal
B2B

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Match Types
Buyer Supplier
Buyer Supplier
Buyer Supplier
Double Commit
Buyer Picks
Supplier Picks
Upwork, Craigslist
Airbnb, Zillow
Uber, Rev
Complex, custom stuff
Commodity
Variety

Low Quality
High Quality
Desperation Curve

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Teach your Users*
• Display Successful Transactions
• Reduce Variables
• Match new and repeat users
• Use community forums on your site
• Offer extra Q&A, Help and forums for newbies
• Make your help context sensitive
• Have clear and well defined policies
Marketplaces function best when users know exactly what to
expect and how to behave. There is a learning curve.

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Network Effect in Marketplaces?

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Tiering Marketplaces
The best marketplaces know that you must segment users
and provide different experiences for different levels of users.
• When?—Once you can identify the classic 80/20 rule where
80% of the activity might come from 20% of your users.
• The goal of all this tiering structure is to reward and retain
your most active users.

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Disintermediation

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Virtuous Cycles
Attract Screen Optimize
Retain
Expel
Lots of time here
Ineffective
Not much time here
Very effective

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Liquidity Hacking
Find Aggregators
• Physical – office, campus -- Zesty
• Enterprise client – Gigwalk, Wonolo
• Scrape – Craigslist
Provide Value to One Side -- Github
Narrow your Focus -- OfferUp
Curation (reduce options) - YourMechanic
Brute Force (do things that don’t scale) - oDesk

Fraud Curve

Master
Commodity
Pay for Acces
s, Expertise
Buyers
Pay for Cost Savin
gs, Speed, Conveni
ence
Suppliers
Value Prestige, Bra
nd, Reputation
Value Earnings
, Convenience
,
Master Marketplaces

Thank You
Questions?
Josh Breinlinger
josh@jsv.com