In the startup teaching and mentoring I do, many-to-many marketplaces are one of the the most common business ideas my students come up with. Whether it is restaurant recommendation sites, crowdsourced software development, or matching babysitters with parents who need them, all of these ideas have the same structure and the same fundamental challenge.
Students typically imagine these companies as they would be after they had already become successful with thousands or hundreds of thousands of users registered and active. Naturally, any business plan is much simpler if you can simply assume you already have the contact information of thousands of people who what your product.
But, of course, you don’t.
My advice to all these students is the same. “What will you do tomorrow? If someone comes to your site tomorrow, they will see an empty marketplace and never come back. How will you get your first 1,000 users? What will you offer them?”
Fortunately, for valid business ideas there are always strategies for developing your initial user base, and that is what will make or break the venture.
Getting your second million paying customers is much simpler than getting your first 100.
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