A marketplace is a location where goods and services are exchanged.
Marketplaces are largely valuable and defensible when they are in motion with critical mass. However, how do you identify and actually build a successful marketplace?
Here are the 2 things that make online marketplaces possible.
If you don't do one you better be doing the other...1. Identify and liberate:
Open up value that was previously inaccessible.2. Consolidate:
Make the already existing value easier to access
If you're not doing either, but you're probably not a marketplace.Identify and liberateDogVacay
, and Getaround
offer something that was previously not available.
- Before DogVacay there was no industry to find local non-professional doglovers to watch your dog, there were kennels, independent walkers, and friends/family. They realized the excess capacity of available doglovers was actually a huge potential value just sitting there. They then liberated that value with doglover profiles, reviews etc. so that anyone could contribute by listing themselves on DogVacay.
- This is the same for Airbnb and spare bedrooms. People have always owned bedrooms, but no one ever thought about how to monetize that bedroom's market value before the guys at Airbnb. They identified the inaccessible value and make it accessible for a price...
- Getaround realized that the millions of privately owned parked cars are worth something to people looking for rides. Then they built the layer to allow 1000's of people to share them, and we did, (my car on Getaround): Rent a Baby Blue Mazda MAZDA3
Uber, Urbansitter, and Etsy made an already existing value (limo companies, babysitters, and handmade items) easily accessible to masses.
- Uber dropped the friction of ordering a private limo (call, wait, hope, call, meet, go, stop, pay, tip) tremendously.
- Urbansitter made finding a babysitter very easy, which was previously all word of mouth.
- Etsy sellers were previously selling in farmers markets, small websites, local stores, etc. but now there was an online shopping window!
, we think a lot about our position in the market and how we can best consolidate the fragmented home care industry of caregivers and careseekers. Reviews and references that caregivers can share with clients has been huge for us, similar to finding a babysitter.
When a caregiver (supply side) has a centralized profile, this becomes a part of their identity, they share and promote it to find new work.
Here is an example of a caregiver profile and reviews: Liliana R caregiver video | HomeHero