Tips For Early Stage B2B Marketplace Founders

25 Apr 2023 · 3 min

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2:33

In this interview, the speaker offers practical, high‑velocity advice for founders launching a B2B marketplace. The core recommendations are: (1) pick either buyers or sellers as the initial focus and get that side deeply entrenched before courting the opposite side; (2) launch real transactions as fast as possible, even if it means handling payments manually (e.g., via PayPal) and using email notifications to confirm bookings; (3) draft a clear legal document that spells out the responsibilities of the platform, buyers, and sellers, and iterate on it over time; (4) own the payment flow rather than outsourcing it, despite the initial fear it may cause; (5) develop a concrete hypothesis explaining how additional buyers will attract more sellers and vice‑versa, thereby creating the network effects essential for marketplace growth. The speaker emphasizes hard work, getting “dirty” early, and having a solid growth model to sustain the marketplace.

Chapters

Do you have any maybe high-level tips that you might want to share with our earlier stage B2B marketplace founders?
To get out there and doing things as fast as possible. I mean, first of all, I definitely, from my experience, you do have to decide who you're going after first and have a stronghold with one side or the other. I don't know, maybe it's possible, maybe you guys have done it, but I don't know how you just start on day one getting buyers and sellers. You have to have one or the other really, really entrenched. Right before you start getting the other. But at the, you know, as quickly as possible, get one side and then start getting those transactions. That's, that's, that's key. Don't be afraid of, of legal stuff, right? I'm saying it now and I hope you guys feel like I did then. It was like, what is she talking about? But writing the document that describes the business relationship, right? What is each, what is your buyer's responsibility, your seller's responsibility, and your responsibility as a platform? Spending time on that over time. The other piece of advice that we got very early on, actually one of our board members is Bob Milod, who was the CFO of Priceline when it went, and he said, You know, own the payments, right? The payments should happen. You you have to take the payments, right? Which seems very scary and daunting. And I tell you, the first time somebody hit book, what that book button did was send me an email. It was big, big, you know, book and sent me an email. And I'm like, "Ooh, look, we got a booking." So we call the guy up and he's like, "How do I pay?" I'm like, "Here's my PayPal account," right? So. And oddly enough, you probably— I probably can't share them, but Priceline had similar stories right at the beginning. So you have to get out there, you have to do it, you have to get the bookings happening, you have to get dirty, and you're gonna have to work really, really, really hard at the beginnings. But get a good model that has a good— have a hypothesis for why having more buyers is gonna get you more sellers, which is gonna get you more buyers, which is gonna get you more sellers. If you can't explain why that's gonna happen, then you don't have the network effects. You don't have, you're not gonna have a marketplace effect, right? So make sure you understand how this marketplace is gonna grow.