Product

I’ve been thinking about marketplaces a lot lately.

One recent observation is that the value of a marketplace is often correlated to the potential upside for the supply side. For example, the average Airbnb ($72B) host earns way more than the average Poshmark ($1B) seller.

Potential upside is also often correlated to supply-side frequency and retention. A Door Dasher earning a part-time to full-time living on the platform is much more likely to return than a parent selling their kid's bike on Craiglist.

Two additional considerations that drive value for marketplaces and might not reflect the correlation you point to: 1. marketplaces that have frequent interchangeability between demand and supply-side (e.g. Airbnb hosts being guests also) and Reed's law (that goes beyond Metcalfe's law and points to the multiplicity of subgroups or use cases each node could have)