Part THREE of my series on Marketplace Growth is now live:
🐥 How to Drive Early Supply 🐥
Learnings:
1. Most common growth lever: SALES 😮
2. Tied for 2nd: Referrals + Piggy-backing
3. Median levers per org: TWO
4. Not common: SEO, Paid
Much more 👇
lennyrachitsky.com/p/how-to-kicks…
🐥 How to Drive Early Supply 🐥
Learnings:
1. Most common growth lever: SALES 😮
2. Tied for 2nd: Referrals + Piggy-backing
3. Median levers per org: TWO
4. Not common: SEO, Paid
Much more 👇
lennyrachitsky.com/p/how-to-kicks…
1/ Top ten most common supply growth levers for early marketplaces:
1. Direct sales
2. Referrals
3. Piggy-backing off of an existing network
4. Word of mouth
5. Subsidizing supply
6. Employees are early supply
7. Single-player mode
8. Performance marketing
9. Loops
10. Events
1. Direct sales
2. Referrals
3. Piggy-backing off of an existing network
4. Word of mouth
5. Subsidizing supply
6. Employees are early supply
7. Single-player mode
8. Performance marketing
9. Loops
10. Events
2/ One fascinating meta-learning that emerged from this research is how few levers individual companies found success in early-on. The median number of levers that the biggest marketplace companies relied on to kickstart supply growth was just TWO (and the average was 2.5).
3/ Direct sales: Another significant learning (and surprise) for me in doing this research was how important one-on-one direct sales was. Sales ended up being a crucial lever for about 60% of the companies I talked to — twice as common as the next biggest lever.
4/"For us, for supply growth, it was direct sales, no question!" @gokulr Caviar
"Direct sales was critical to get the first listings on the platform" @georgbauser Airbnb
"The main thing that I believe really worked was recruiting sellers in person at craft fairs" @mcfunley Etsy
"Direct sales was critical to get the first listings on the platform" @georgbauser Airbnb
"The main thing that I believe really worked was recruiting sellers in person at craft fairs" @mcfunley Etsy
5/ Referrals: The second most common early supply-growth lever (tied with the next lever) was offering a referrals program — incentivizing existing supply to refer new supply. About a third of the marketplaces I spoke with saw a lot of success here.
6/ "Referrals and ambassador programs were big for us early on. Double digits of %’s of new supply early on came from these programs." @Bnjii, Lyft
"On the supply side, referrals was about 1/3 of the first trips — and they were also the best drivers." @andrewchen, Uber
"On the supply side, referrals was about 1/3 of the first trips — and they were also the best drivers." @andrewchen, Uber
7/ Piggy-backing: About a third of the marketplaces also relied heavily on piggy-backing off of an existing network (in almost every case, Craiglist) to bootstrap their supply growth. When it worked, it was the first or second most important lever for these companies.
8/ “The first thing the launcher team would do when they launched a market would do is figure out supply. They would go straight to Craigslist.” @andrewchen, Uber
9/ Much much more in the full post – don't miss this one. Featuring insights from @onecaseman @georgbauser @jimbovig @tmendelsohn @mcfunley @gokulr @andrewchen @micahmoreau @nivi @Bnjii @bmrothenberg @talrav @julien @nickeyskarstad @natemoch @djrosent
lennyrachitsky.com/p/how-to-kicks…
lennyrachitsky.com/p/how-to-kicks…
10/ Ask: If you work at any of the companies I'm covering:
1. PLEASE let me know if I got anything wrong. I’ll correct it in the next post. DM me.
2. If you have any other insights to share about what was important early-on, I’d love love love to know!
Otherwise, enjoy!
1. PLEASE let me know if I got anything wrong. I’ll correct it in the next post. DM me.
2. If you have any other insights to share about what was important early-on, I’d love love love to know!
Otherwise, enjoy!
Awsome thread by @ljin18 on this same topic — a lot more examples of these tactics in action
