The practical guide to building an online marketplace

Inspired by the success of online marketplaces like Airbnb, Etsy, or Fiverr? Want to know how to create a marketplace? You've come to the right place.

In this step-by-step guide, we’ll go through everything you need to know about marketplace development. From designing and creating a website to launching and growing your business, each article offers lots of practical advice with peer-to-peer, B2C, and B2B marketplaces in mind.


Introduction

How to create an online marketplace one step at a time

Welcome to the beginning of your journey as a marketplace entrepreneur!

The purpose of this guide is to help you get started with your journey and move forward one step at a time. An iterative approach will help you maximize learning, minimize costs, and make sure your early stages set your idea up for success. The content you find here is the complete, free version of our Amazon bestseller: The Lean Marketplace. A practical guide to building a successful online marketplace business.

Creating an online marketplace is a process. Here are the steps in a nutshell:

  1. Find a great marketplace idea and validate it.
  2. Choose your marketplace business model and pricing level.
  3. Build your Minimum Viable Platform (your marketplace MVP).
  4. Build your initial supply.
  5. Launch your marketplace to the first customers.
  6. Track your key metrics and grow your business.

This guide will take you through the steps and give you 16 articles worth of practical, tactical advice. You’ll learn about both the business strategy side as well as get a deep dive into marketplace website development.

To make navigating the guide easier, we’ve divided it into three sections. The first is about getting started and finding and validating a marketplace idea. The second discusses the technology side: how to develop a marketplace website. The third is about launching and growing your business: how to build a user base and track your success.

We’ve worked with marketplace founders for over a decade. This guide is the collection of everything we’ve learned from our own successes and failures. We sincerely hope it will help you get started with your journey and bring your marketplace idea to life. Let’s get started!

Find each article below or listen to the complete guide on the Marketplace Academy Podcast!


Part 1

Getting started with a marketplace business

An online marketplace is a platform that brings together sellers and customers – supply and demand. A marketplace lets them find each other, facilitates their transactions, and generates revenue through marketplace fees.

Examples of online marketplaces are Airbnb, Etsy, eBay, and Uber. If you have a business idea that works a bit like them – but don’t know how to get started – part one of the guide is for you. These articles help you understand how online marketplaces work, how to find a great marketplace idea, and how to turn your idea into a successful business.

Start a marketplace
Starting a marketplace

What you need to know before starting your marketplace business

An introduction to online marketplaces. What they are, why they are booming, and why you should build one.

by Cristóbal Gracia

Marketplace idea
Starting a marketplace

How to find great online marketplace ideas

How to spot marketplace opportunities and transform them into great business ideas.

by Cristóbal Gracia

Choose the right marketplace business model
Starting a marketplace
Business Model

How to choose the right marketplace business model

Compare marketplace revenue models and find the revenue strategy that can boost your growth.

by Juho Makkonen

How to discourage people from going around your payment system
Business Model

Managing marketplace leakage – How to discourage people from going around your payment system

How to solve the most daunting challenge of the marketplace business model: platform leakage.

by Juho Makkonen

Marketplace Pricing - how to set the marketplace commission and transaction fee
Business Model

Marketplace pricing: How to define your ideal take rate

Find a pricing strategy that is just right for everyone: you, your providers, and their customers.

by Juho Makkonen

How to validate your marketplace idea
Starting a marketplace

How to validate your marketplace idea before building the platform

Don’t build a desert platform. Here are the steps to take to prevalidate your marketplace idea.

by Cristóbal Gracia


Part 2

Marketplace website development

The trickiest part of building a marketplace business isn’t marketplace website development. The biggest challenge is finding a business model that works for you, your supply, and your demand. That’s why it’s important not to spend too much time building the first version of your marketplace site.

This chapter guides you through building your Minimum Viable Product (MVP). The goal is to help you launch your online marketplace fast and start learning about your audiences – while still offering them a lovable user experience from day one.

Rows of same-sized, square-shaped boxes in pastel colors
Starting a marketplace
Platform technology

Your marketplace MVP – How to build a Minimum Viable Platform

What you should focus on when you’re creating the first version of your marketplace platform.

by Cristóbal Gracia

Different sized and shaped paint brushes side by side
Marketing & growth

How to communicate your marketplace value proposition

Making sure every visitor knows how your marketplace can help them.

by Cristóbal Gracia

How to help your customers find the right product or service
Platform technology

The marketplace search engine: How to help your customers find what they’re looking for

Your success depends on demand finding its way to supply. Here’s how to make it happen.

by Juho Makkonen

Four eggs in different stages from raw to fried sunny side up.
Platform technology

How to design your marketplace transaction flow

The science behind minimal abandoned carts for marketplace platforms.

by Juho Makkonen


Part 3

Launching and growing your business

The best online marketplace businesses improve over time. Plan your launch in two steps, starting with a product launch that lets you collect initial feedback from your most important users. Then go for a bigger marketing launch with the help of concrete, low-budget strategies.

Tracking the right marketplace metrics and nurturing your user community should be a priority from early on. As you’ll see, this work will support your marketplace growth also in the long term.

How to build supply for your marketplace
Business Model

How to build your marketplace supply

How to bring in the first, quality providers before your platform has any customers.

by Juho Makkonen

How to launch your marketplace
Marketing & growth
Business Model

How to launch your marketplace

Strategies that bring demand to your freshly opened marketplace platform.

by Cristóbal Gracia

How to grow your marketplace
Marketing & growth

How to find the best marketplace growth strategies

Choosing the early-stage marketing mix for your marketplace.

by Juho Makkonen

How to measure your success: the key marketplace metrics
Marketing & growth

11 marketplace metrics you should be tracking to measure your success

The most important metrics that anchor all your marketing and growth activities.

by Juho Makkonen

How to build trust in your marketplace
Business Model

How to build trust in your marketplace

Tactics to increase trust between your providers and customers – and to boost transactions.

by Cristóbal Gracia

How to turn your marketplace into a community
Business Model

How to turn your marketplace into a community

Engage your best providers by turning them from users into community members.

by Cristóbal Gracia

Prefer books?

The practical guide is also available as an Amazon bestseller, ebook or hardcover.


Part 4

The best way to learn? Start developing a marketplace!

There are 16 articles in this guide, each written to help you tackle a specific challenge of creating an online marketplace. You’ll learn how to validate your concept, build your platform, grow your user base, and, most importantly, facilitate transactions between your users. The articles paint a big picture and also dive into the nitty-gritty details.

You can read the articles one by one to get a complete understanding of our thoughts and recommendations. Or you can use the guide as a go-to source to read while you work on your business. If this guide helps you avoid even one of the mistakes we’ve made ourselves developing marketplace websites over the past ten years, we consider it a huge success.

But in the end, there’s only so much you can learn from a book. The best way to learn is to start building your own marketplace business.

Creating a marketplace is a challenge, but it’s also incredibly rewarding. Whatever happens, the things you’ll learn along the way about building a platform, a user base, and a community will stay with you for the rest of your life.

Best of luck with your marketplace business!

Learn by doing. Start building a marketplace with Sharetribe today.

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