This content was created by Max Brun. This content was uploaded by Max Brun. This is a YouTube Q&A titled "Mike Ghaffary Q&A On Sharing Insights & Tips From How Eat24 Executed Well As A Marketplace" (posted June 21, 2022). The clip captures a conversation between Mike Ghaffary and an audience member/founder (labeled SPEAKER A, who says they founded a marketplace called Maxable). Mike discusses how Eat24 achieved strong execution — growing quickly while remaining profitable — and gives tactical advice for marketplaces: find unique, defensible sources of organic growth (e.g., creative hiring, viral/novel job posts, PR stunts, engaging email content, SEO, events, offline channels) rather than relying primarily on paid acquisition. The context is practical marketplace growth and execution lessons.
I had a question. Hi, Mike. Nice to meet you.
Hi, how are you? Nice to meet you.
Yeah, I founded a marketplace called Maxable. It's for housing development. So I was, I was curious about when you were talking about Eat24, to kind of go back earlier in the discussion about how you said execution really made the difference for them. And we're at a similar size. We're about 10 people plus some contractors. And so I'm curious if you have any insights of like kind of what you think that they were doing really well that other companies weren't doing at that stage.
Yeah. So a few things. One is they had their cake and eat it too. I think for the last several years, people have looked at a trade-off of you can either grow insanely fast and burn a lot of cash, or you can not burn very much and grow slower. And the amazing thing about Eat24, the Goldilocks, if you can do it, especially in this environment, is they were growing really fast and burning very little. Not only burning very little, they actually got EBITDA positive and they were kicking off cash. The founders actually were able to pay themselves bonuses and they never raised outside venture capital. It was incredible because they had these 30% EBITDA margins. Now, how do you do that? One big, big technique for your marketplace I always talk about is Find a unique source of organic growth for one side of the marketplace, ideally both. If your strategy is that you're just gonna pay up to acquire for supply and demand, you're gonna have a very hard time. Why is your marketplace gonna succeed over somebody else? Someone else can literally just come copy your website word for word, you know, and you can write an angry blog post saying they copied me. And we've seen a few of those recently, but there's usually not much recourse. And they can just outspend you and it's a race to the bottom. But if you have some unique tactics, something truly defensible, something creative, something different, that can stand out. The founder of E24 had worked in a pizza restaurant, saw how inefficient calling on the phone was for delivery. And, you know, now it seems obvious in hindsight, but he realized, hey, there's an opportunity here. He was early. He then— this is an Israeli founder who spoke English with an accent. You know, it wasn't— he didn't go to any fancy American universities or anything like that. So he didn't automatically understand American culture necessarily. But you know what he did that was really smart? He put out— he's a very creative guy. He put out this outlandish blog post— or sorry, job requisition. Said, we're hiring for basically a weirdo to run our creative marketing team. Like, if you can't fit in in any other company and you're a total oddball and you're like a geek, but you make this like crazy humor. So he put up this job post. He said, come. apply for this job. And he got this amazing creative woman from Berkeley who was an English major who was like, yeah, I don't like normal jobs, but this is like this crazy blog post. And she helped build this team. And they had this, just the most innovative creative content and organic growth team I'd ever seen. And they did, you know, PR stunts, email campaigns. We had a weekly email list. That, you know, when, when I left, I think we were doing like 3 million people a week were getting our weekly email. And just, you know, if we emailed these people daily, they'd be annoyed, but their unsubscribe rate was exceedingly low because the emails were hilarious. We made the best jokes and we had these funny things and video, all this stuff that the creative team came up with. And that was like a third of our orders every week came from that email list. Imagine all the paid, you know, acquisition you're doing. Imagine you just got a third of your orders for free because a couple of creative people had this great email that everyone was reading, right? Now that worked for E24. You know, that might work for you. It might work— something else might work better for you. But really thinking about what are the, you know, sit down over a weekend with your co-founder, like what are the 12 organic user acquisition ideas we can come up with? And how do we really chase these down? They were, you know, for that one thing that worked, They tried 10 other things across, you know, from billboards, which are paid but are like different, to, you know, to radio ads, you know, again, paid but offline, not at least like super expensive online user acquisition, to like physical tchotchkes, events marketing, so many different strategies. You know, Yelp, by the way, was also built on organic user acquisition. SEO with Google, community and events was a big part of it. Hardly any paid acquisition for the entire first decade of the company, frankly. So those are all some of the, some of the tactics around their execution that were really effective.
