What got you here, won't take you there
I’ve been thinking a lot about p2p marketplaces lately. The following are merely anecdotal observations and does not necessarily reflect the bigger picture, but putting this out there to see if others agree or not.
My current hypothesis goes like this: “it is only possible to run a p2p marketplace at scale in the short term. Adverse selection will remove the good actors in the long term, and the best way to cope with this is either to own supply or partner with professionals”.
Some background: Uber, Airbnb, Getaround and others have grown massively the past 10 years. They’ve done this similar to most startups, by targeting a part of the market that incumbents don’t want to touch (because it’s cumbersome, difficult with old tech etc). Coincidentally, using freelancers was also the most cost-efficient way to start and scale, and thus possible to grow from nothing to a lot in a decade.
My question is, as the title says, will what got them to where they are today get them to where they want to go? What is next? Some observations:
My experience with using Airbnb the past 10 years is that more and more listings are posted by professionals. Hotels, hostels etc are they can get more bookings by putting rooms up on Airbnb, similar to Booking.com. Deliberately or not, Airbnb’s supply has been professionalized.
My experience using car sharing platforms is that I prefer seamless experience where I don’t have to coordinate with another person. I’ve been on the other side (renting out my car) for the past few months, but too much hassle (accidents etc) means I’m probably quitting. On the supply side, I’m (a “peer”) churning. On the demand-side, I prefer to buy from someone owning supply.
Reading about Uber’s difficulties with driver retention (or, how they don’t disclose any information about this) is another data point. I can see them partnering with taxi companies (professionals) or offering more employment-like agreements (guaranteed salary, benefits etc) as a way to address (potential) driver churn issues.
These are only anecdotal observations, as mentioned initially. I could be completely off. But currently I’m more bear than bull on p2p marketplaces’ plans to continue scaling as before.