Required Reading for Marketplace Entrepreneurs

This week, we published the a16z Marketplace 100, a ranking of the largest and fastest-growing consumer-facing marketplace startups and private companies. See the full index and analysis here, and visit for more marketplace-related content.

From academics to analysts, startup founders to journalists, these 20 recently published pieces and books helped shape our thinking on the business dynamics, historical context, and future of marketplace companies. 

How to Kickstart and Scale a Marketplace Business
This mega-essay by Lenny Rachitsky, former supply growth lead at Airbnb, synthesizes insights from 17 marketplace businesses, including Doordash and Etsy. Topics include how to drive supply and demand, growth levers, and maintaining quality. 

Tales of a Marketplace Founder
Pared co-founder Dave Lu argues that not all marketplaces are created equal—and outlines the dimensions that influence marketplace success. 

Platforms vs. Verticals and the Next Great Unbundling
a16z’s Jeff Jordan (veteran marketplace operator and investor; former CEO of OpenTable and GM of eBay North America) and D’Arcy Coolican describe the opportunity to unbundle horizontal platforms into vertical marketplaces. 

What’s Next for Marketplace Startups: Services 
Li Jin and Andrew Chen of a16z trace the evolution of marketplace platforms, from listings to verticalized Craigslist models, “Uber for X” companies to managed marketplaces. The deck also explores the opportunities for consumers to discover and purchase services online. 

WTF Is Marketplace Liquidity?
For all the emphasis placed on liquidity, there are few resources that delve into how to measure it. Julia Morrongiello of Point Nine Capital cuts to the chase. 

An Important Marketplace Metric: Search to Fill
A failed Uber request inspired Trusted CEO Anand Iyer to write this deep dive into a critical (but oft overlooked) metric: search to fill.  

Eight Things to Consider When Building Managed Marketplace Companies
From licensing requirements to one’s Net Promoter Score, a16z partner Li Jin unspools eight factors to consider when building a managed marketplace in a regulated category. 

Making Markets
Marketplaces have two major camps of analysts: the business world and academia. In this paper, Harvard Business School professors Thomas Eisenmann and Scott Kominers provide a wonky overview of the causes of market failure. (Free PDF available here until 2/29.)

Super Pumped: The Battle for Uber
The cinematic tale of Uber’s origin and its founder, Travis Kalanick, as reported by the New York Times technology reporter Mike Isaac who covered Uber

The Passion Economy and the Future of Work
The next wave of work opportunities will be in platforms that enable people to monetize their passions, predicts a16z’s Li Jin. Here’s how these marketplaces are treating individuality as a feature, not a bug. 

Marketplaces and Network Effects
a16z’s Jeff Jordan shares what makes marketplace business models so attractive, especially compared to classic ecommerce and retail.  

The Anatomy of a Marketplace
As the founder and former CEO of TaskRabbit, Leah Solivan is intimately acquainted with the complexities of marketplace businesses, which she calls “the ultimate puzzle.” In this post, the entrepreneur-turned-VC (she’s now a general partner at Fuel Capital), describes how automation has transformed the building and scaling of marketplace businesses and streamlined the user experience.

Shopify and the Power of Platforms
Tech and media analyst Ben Thompson is perhaps best known for his digestible daily newsletter, the Stratechery. But he often goes long when unpacking the dynamics of various marketplace companies, including Airbnb and Uber. In this essay, he uses Amazon and Shopify to highlight the distinction between platforms and aggregators.

Money Out of Nowhere: How Internet Marketplaces Unlock Economic Wealth
Bill Gurley, now an investor but former longtimeAmazon analyst, explores how internet marketplaces enhance productivity and efficiency, drawing on examples from Ebay, Uber, Upwork, Hipcamp, and Instawork. 

Managing Tensions In Online Marketplaces
a16z’s Jeff Jordan taps into his experience as the former SVP and general manager at eBay to explain why marketplaces need to nurture and manage “perfect competition” to thrive. 

The Oral History of Travel’s Greatest Acquisition
How went from a scrappy pet project to a travel juggernaut, as told by the people that lived it.

A Guide to Marketplaces
Angela Tran Kingyens and Boris Wertz of Version One Ventures updated their all-encompassing guide to marketplaces with new sections on on decentralized marketplaces and marketplace exits. The digestible ebook remains a valuable resource for founders looking to seed, grow, and scale marketplace companies.

State of Marketplaces
Menlo Ventures partner Steve Sloane’s presentation provides a great overview of investing trends, including IPO benchmarking for marketplaces, retention metrics, and emerging trends in private marketplaces. 

Why It’s Hard to Escape Amazon’s Long Reach
WIRED staff writers Louise Matsakis and Paris Martineau provide an exhaustive accounting of Amazon’s many business pursuits, from fashion to home security systems, cloud computing services to groceries. It’s an illuminating look at how the once-modest online bookseller has morphed far beyond its marketplace roots.

The NFX Marketplace Scorecard
James Currier of NFX shares the firm’s internal scorecard for assessing a marketplace’s potential. The deck provides a useful framework for founders to evaluate their strengths and risks. 



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