You’re probably already aware of marketplace businesses that aggregate products from multiple sellers to provide consumers with a single place to get the best product/price (think, Amazon or Uber). There are some very successful marketplaces but it is notoriously hard to start one. For one, you have to run two businesses, one to attract sellers and one to attract buyers. Each side relies on the other, if there aren’t enough sellers then buyers won’t be interested. If there aren’t enough buyers however, it’s hard to get sellers on board. This is where Network Marketplaces come in.

Network Marketplaces

Network Marketplaces make use of an existing network of people (i.e. chefs, cleaners). Using an existing network helps build the marketplace through word of mouth (compared to commoditised marketplaces like Uber that have increasing cost of acquisition as the market gets saturised). In the case of Uber, their competitors are after the same customers AND drivers as they are and this leads to increasing cost of customer acquisition, hitting their margins.

Network marketplaces combine aspects of marketplaces and social networks. They are a single place where professionals can meeting people with the same interests and sell to them.

Here’s a few potential network marketplaces:

Bike repair

  • existing network of cyclists
  • existing network of repair shops
  • people don’t know which shop to trust or how much repair will cost them (use service to check reputation beforehand).
  • Estimating costs is hard unless you know exactly what is wrong.
  • upselling opportunity for new parts or new bikes

Bike Sales

  • network of market sellers in city X + bike shops + personal sellers
  • collate all these in a single platform, photos and prices

Remote Working places

  • digital nomads/remote workers
  • nomads move when they get bored = repeat business
  • Airbnb is too random, people need very stable WiFi, coffee/tea, stocked kitchen etc
  • opportunity to upsell remote jobs to existing network of remote workers

Matt Reid

Lead Software Architect. Java, Node.js and TypeScript enthusiast.

drei01 Matthew_Reid