The Troubling Trend of Lazy Internet Marketplace Startups
I’ve built several two-sided marketplaces over the years. Here’s why the 2SM is getting a bad name.
Last week, I answered a founder’s question about how to pinpoint the right revenue streams for his two-sided marketplace, now that it was seeing traction on the vendor side.
I detailed the process of quantifying the value that his marketplace provided to both vendors and buyers, and how to derive margins and profits from that value (and spoiler alert, I came up with a third option for mining additional value, essentially suggesting turning his 2SM into a 3SM).
During the answer, I also went into a quick rant on lazy internet marketplace startups — mind you, this had nothing to do with the question or the asker’s startup — but I threw it out there as a counterpoint.
In other words: Here’s what NOT to do.
Because I see this problem all the time. I get questions and requests for help from purveyors of marketplace startups that are fading because they’ve already made a critical (and lazy) error in their business model.
I stopped short with that rant because I didn’t want to blast the asker with fire that had nothing to do with his business.
