Ameet Shah, partner at Golden Ventures, on the economics of vertical SaaS marketplaces

Product-oriented marketplaces (e.g. EBAY, TDUP*, Faire*) primarily match supply and demand in goods and then enable the payment for and fulfillment of those goods. The way these marketplaces achieve leverage is by driving the cost of the transaction down.

One threat was we get hollowed out vertical by vertical by specialized marketplaces, because one of the benefits of the horizontal marketplace is the consumer can go to anywhere they want and find what they're looking for. One of the negatives is it's really hard to tailor the experience to the unique attributes of that vertical

More on B2B marketplaces: B2B marketplaces 1.0 didn't really work. Most B2B spend remains offline. Why? - horizontal, didn't address vertical specific workflows. - lacked integrated payments & lending - digitized existing relationships vs facilitating new ones Thread 👇

What kinds of actions did that mean when you were at eBay operating to try to promote price discovery or price equilibrium or something like that? What were you literally doing? Jeff: The most interesting thing is early on we try all these initiatives that we baked on our own and debuted the community. And we found out the leverage was way more to ... See more