Our guide to marketplaces

By Angela, November 12, 2015

At Version One, we love marketplaces. Just look at our portfolio, and you’ll understand how important we think marketplaces are to the future of commerce.

Over the past year, we have focused much of our blog content on helping marketplace founders build their companies. That’s because we realized that while there is a lot of great information for tech startups, not much of it deals specifically with marketplaces. And anyone building a marketplace company knows that marketplaces face unique challenges – including how to solve the chicken and egg problem with supply and demand and how to monetize when services are delivered offline.

To that end, we put together a handbook, A Guide to Marketplaces. It compiles many of the insights we’ve learned from working with great marketplace companies and analyzing the industry.

We hope the handbook helps you in your own journey to break down walls in how goods and services are bought and sold. There’s no single way to build and scale a marketplace, but the book can help you figure out your own path to build supply and spark the virtuous circle of supply and demand.

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Download the PDF or ePub version of the handbook and refer to it as you need it.

Lastly, we’d love to hear if you find the content useful. What should we expand on? Did we leave anything out? Please leave a comment below or reach out to us directly.

Happy reading!

Angela and Boris

May 2016 Update:  we summarized this handbook in slide deck form for quick reference which you can access here.

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  • Jing Wu

    This is very informative and such a nice read. Thank you!

  • Brendan Benzing

    Thanks for sharing!!

  • Miranda Nash

    Excellent guide – thank you!! I’d suggest one more marketplace type – C2B. For example, a recruitment marketplace where sellers are individuals (consumers) providing their time and talent to buyers (businesses).

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  • Rathna Sharad

    A fantastic read! Thanks.

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  • YNOME

    As a marketplace for private banking services (ynome.com), we at the team here find some absolute truth in this guide. Thanks to Version One for sharing this!!

  • Thank you for a wonderful guide. I really needed this, so I’m so grateful that you took the time and effort to put it together. I was wondering if you could give me some feedback: I’m trying to determine the best review/accountability system for my new peer-to-peer marketplace for children’s learning experiences led by local parents and teachers, Cottageclass.com My problem with five stars is that it seems like an antiquated system that plays into the values we’re opposed to (E.g. grading kids/standardized tests) I was considering upvoting, or using disqus (coupled with a confidential feedback form we can use to inform our teachers and offer special status to particularly exceptional teachers). Right now, I’m leaning towards Facebook comments because it seems like a lot of parents are on Facebook and it would be particularly good for marketing if their testimonials were automatically shared when they commented on a teacher’s class – also so that parents can easily see if their friends have taken a particular class. I’d love your feedback if you have any thoughts on the matter. Thanks so much!

  • bwertz

    Appreciate the feed-back!

  • bwertz

    I would go 2 ways: quantitative feed-back (if you don’t like a 5-star review system, you might go for a simple like / don’t like or recommend / don’t recommend system) and comments for the qualitative feed-back.

  • wonderful. thanks so much! very helpful.

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  • Thank you for this guide to analyze On-demand marketplaces! I think on-demand marketplaces which set pricing are very interesting in high fragmentation market. In our case at http://www.everphotoshoot.com (on demand photographer) we set pricing to have a transparency offer. Instead of a repeat business, we have a virality because people want to share their photos with a great service.

  • Hi Boris and Angela, I just read this again from start to finish. I can’t thank you enough for putting this together. Creating a community marketplace where buyer and sellers grow at a simultaneous rate is indeed a daunting task and it’s really encouraging to listen to you support the patience and consistency and time it takes to make this work, as well as the painstaking attention to “power sellers” I feel really validated after reading through this again!

  • bwertz

    Thanks for re-reading!

  • For a marketplace that is weaker on point 2 on page 9 “Monogamy vs Playing the field” due to customer loyalty to a single provider, would you recommend focusing on fostering loyalty to the marketplace on the seller side? I’d love ideas on ways marketplaces have addressed this weakness effectively.

  • bwertz

    The question is how to keep sellers run their business through your platform – this could be because the platform offers convenience (easy payments, tax management, etc.) but needs to go hand in hand with a low fee (especially relative to the fee you would charge for introducing a new customer).

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