Marketplace

What Is a Marketplace Startup?

Marketplace startups create digital platforms that bring buyers and sellers together in one place, enabling them to communicate and conduct transactions. Over the past few decades, online marketplaces have emerged as a popular business model for facilitating the buying and selling of nearly all kinds of products and services. Numerous disruptive marketplaces have flourished in the tech startup industry, such as Ebay, Airbnb, Uber, Wag! and Fiverr.

There are a few different kinds of marketplace startups, including B2B marketplace companies, multi-vendor market places, and two-sided networks.

What Does a Marketplace Mentor Do?

A marketplace mentor takes on a crucial role within the marketplace platform economy by supporting aspiring marketplace founders. Mentors have spent years developing their own successful marketplace ventures, and can use their hard-won experience to guide the next generation of entrepreneurs.

What Is a Two-Sided Marketplace?

A two-sided marketplace is a particular business model within the larger industry of online shopping. Most marketplace startups function as two-sided marketplaces. 

Unlike traditional e-commerce startups that advertise and sell products directly to customers, two-sided e-commerce marketplaces are intermediary services that connect two distinct user groups — usually buyers and sellers — and facilitate transactions between them. In this way, a two-sided marketplace creates a symbiotic ecosystem where each side benefits from the other.

Here are a few two-sided marketplace company examples:

• Ebay is one of the most straightforward and well-known examples of a two-sided marketplace where sellers can list items for sale and buyers can place bids.
• Airbnb connects travelers looking for accommodations (buyers) with hosts who have available space they want to monetize (sellers).
• Fiverr connects freelancers with potential clients who are looking for specific services, such as graphic design or content writing. This platform makes it easy for freelancers to advertise their skills to interested buyers while also providing clients with convenient access to a pool of talented professionals.
• Uber revolutionized the transportation industry by creating a way for passengers in need of rides (buyers) to connect with drivers (sellers) at their point of need via a simple mobile app.
• Wag! Is the fastest growing pet care marketplace in history. Pet parents can book background checked dog walkers, groomers and pet sitters through a mobile app. 

Each of these two-sided marketplace technology companies thrives on the network effect, which is when the value of the marketplace increases as more participants join. The presence of buyers entices sellers to join the platform, while a diverse range of sellers attracts more buyers, resulting in a cycle of growth.

What Can a Marketplace Mentor Do for You?

A marketplace startup mentor can provide advice to you and your team, answer your questions, offer valuable feedback as you develop your marketplace business model, and much more. Mentors have firsthand experience with many of the challenges you’ll face as a founder; they can share their perspective with you and use their experience to help you navigate the industry successfully.

Here are a few of the specific ways a marketplace mentor from Mentorcam can support you as a startup founder:

• Strategic Direction: A marketplace mentor can help you clarify your startup’s vision and mission. They can help you define your target audience, pinpoint your unique value proposition, and develop a business strategy that achieves sustainable growth.
• Marketplace Design: A mentor can also offer insights regarding effective user experience design. They can advise you as you build your marketplace platform’s features, ensuring seamless navigation, streamlined transactions, and a compelling interface for both buyers and sellers.
• Revenue Generation: Crafting a viable business model is one of the toughest parts of founding any kind of startup. A mentor can help you identify revenue streams, gauge supply and demand, and explore additional marketplace monetization opportunities.
• Security and Brand Trust: Successful marketplaces need to establish trust with their users — including both buyers and sellers. A marketplace mentor can show you how to build trust with your user base and help you plan essential features to comply with marketplace regulation, such as secure payment options and robust dispute resolution mechanisms.

These are just a few of the ways a mentor from Mentorcam can guide your marketplace e-commerce store toward success. Our marketplace startup advisors will work with you one-on-one to come up with a tailored plan that addresses your specific needs and questions.

Related areas of interest: Growth Marketing, Fundraising, eCommerce