The Markets Where Marketplaces Will Never Work
David Bailey


I’m not convinced it’s quite true that you need to “lock-in your most successful suppliers”.

I propose that, what you need, is to gain a strong-hold on one side of the marketplace (either one).

Uber doesn’t monopolize the drivers. Most drive for Lyft and for any other platform that comes along too. Uber owns the relationship with the customers. That’s where the inertia is. Same for Airbnb.

I think it’s actually harder to think of organizations that have a strong-hold on the supply side. One example might be brokers in the Aircraft Spares space. And, of course, in real-estate brokerage and aftermarket cars, success is traditionally supply-side driven.

Seems to me the mistake is to believe you’re adding value by simply making a market. I think the real value-add has to be solving a significant problem for one side of the market, meaning the market itself is simply where you get to monetize that value.

Thought provoking article. Thank you.