Article · ~25 min read

How to Kickstart and Scale a Marketplace Business (Part 3): Growing Initial Supply

Lenny Rachitsky · Lenny's Newsletter Freemium Intermediate

Once you decide supply is the harder side to get, this piece is the tactical playbook for signing up those first suppliers by hand. It catalogues the concrete levers real marketplaces used to seed supply from zero, with examples you can copy this week. Pair it with the overview to go from theory to a to-do list.

  • Concrete tactics to recruit your first suppliers by hand
  • Seed supply narrowly in one city or niche, not everywhere
  • Fake or subsidize the harder side until real demand appears
Open on lennysnewsletter.com ↗

It answers 3 questions

  1. Can I validate a marketplace idea before I have supply or demand?
  2. I'm a solo technical founder. How do I MVP a two-sided marketplace when I need both buyers and sellers before it works at all?
  3. I run a two-sided marketplace. Do I get my first customers by starting with supply or demand, and how do I avoid the empty-restaurant problem?

Read with it

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  3. Andrew Chen ran rider growth at Uber and now invests at a16z, so this is the canonical breakdown of how marketplaces get off... andrewchen.com Essay · ~20 min read Required reading for marketplace startups: The 20 best essays Andrew Chen
  4. For a two-sided marketplace, the first real decision is which side to define and win first, and this essay makes the case... NFX Essay · Long read (about 25 minutes) 19 Tactics to Solve the Chicken-or-Egg Problem and Grow Your Marketplace James Currier
  5. Before you tune CAC and take rate, this book gives you the structural picture of why marketplace economics compound: network... W. W. Norton & Company Book Platform Revolution: How Networked Markets Are Transforming the Economy and How to Make Them Work for You Geoffrey G. Parker, Marshall W. Van Alstyne, Sangeet Paul Choudary
  6. Lenny interviewed dozens of people who built Airbnb, DoorDash, Thumbtack, Etsy, and Uber, then distilled how they actually got... Lenny's Newsletter Article · ~25 min read How to Kickstart and Scale a Marketplace Business (Part 1) Lenny Rachitsky
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