GearSource survived three re-platforms and found stability after two decades

Marcel Fairbairn’s journey to a marketplace founder began as a musician. Then he moved into music retail and sold professional lighting and sound systems for major artists like Madonna, Michael Jackson, and the Rolling Stones.

By 2001, Marcel had become a minority owner in a lighting brand but felt the entrepreneurial pull growing stronger. When he decided to venture out on his own, he turned to what was then an emerging frontier—the internet.

"If my next thing was going to work, it had to be on this thing they called the internet," Marcel says.

He spotted a critical problem in his industry. Lighting and sound technology quickly evolved from analog to digital, and along with it, manufacturers and distributors were accumulating warehouses full of obsolete equipment. Companies focused on selling the latest technologies and largely ignored this "invisible inventory problem".

This insight became the foundation for GearSource—a platform to help companies sell their unused audio, video, lighting, and staging equipment. Initially, Marcel focused on manufacturers and distributors and then discovered an even larger opportunity with rental companies. These businesses constantly needed to update their inventory based on artists' specifications for tours and events.

To build his first platform in 2002, Marcel used a piece of software called Actinic that came on CD-ROMs. Early operations were entirely manual: when an order came in, Marcel would enter it into QuickBooks, send a purchase order to the seller, and an invoice to the buyer.

For nearly 16 years, GearSource operated successfully without Marcel ever identifying it as a marketplace. That changed in 2018 during conversations with David Kalt, founder of Reverb (later acquired by Etsy).

"Until then, I had never called us a marketplace. I didn't know that's what we were," Marcel says.

By 2019, GearSource was running on antiquated technology, and Marcel decided it was time to find "the Shopify of marketplaces." 

What followed was what he describes as "three terrible re-platforms in three years" before finally finding Sharetribe.

"We needed something very solid and very reliable. Sharetribe is a little bit like Volvo. It doesn't have a ton of crazy bells and whistles, but it's unbelievably solid and reliable," Marcel says.

Along with the platform changes came an evolution in GearSource's business model. In the early days, the company acted more as a broker, controlling the listing prices and taking an average commission of around 22%.

As the competitive landscape shifted and Marcel embraced the marketplace mindset, GearSource reduced its take rate to a blended average of about 11%.

"When we started thinking about growth in 2019, the biggest thing we did was cut our margins," Marcel explains. "Most companies look to increase their revenue, but we took our take rate down."

Today, GearSource operates with much more automation and less manual intervention, focusing on creating value for its community. The average order value hovers around $20,000, making it a challenging but rewarding business when it works well.

"It's fun to wake up on Monday morning and go, ‘wow, I just had a $200,000 weekend with orders that have taken care of themselves,’ Marcel says. 

For early-stage founders, Marce’s advice is to start as lean as possible.

“Do it on the smallest budget you can possibly manage. Today, you can use AI and online tools to be a one-person organization until you reach a point of having revenue."

After weathering everything from the dot-com bubble to the COVID-19 pandemic (which temporarily made live events illegal), GearSource shows how resilient a well-run marketplace can be—even if it took its founder 16 years to realize that's what he was building.

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Transcript

Sjoerd:
Hi Marcel, welcome to the podcast.

Marcel:
Hey Sjoerd, thanks for having me. I appreciate it.

Sjoerd:
Thanks for making the time. This is actually the first ever Sharetribe customer-focused podcast, so things might be a little bumpy. But let’s start with some context. Who are you, and what’s the story behind GearSource?

Marcel:
It’s funny you say this is your first founder podcast, because I might be one of the first marketplace founders out there. People call me the OG of marketplaces, and I think that’s fair. Other than eBay, Amazon, and maybe a couple of others, I was one of the first.

I started my business life in the weirdest way—as a musician. I was 13, a singer in a band managed by a Catholic priest. One day, he came to rehearsal and said, “I’ve fired the bass player. Marcel, you’re going to play bass now. You've got 30 days to learn the instrument and 40 songs.” So I did it.

Not long after, I realized I was making $200 a week and spending $250 at the bar. That wasn’t sustainable, so I pivoted to sales—first in music retail, selling guitars and instruments, then into sound and lighting systems. I figured out I could work just as hard selling a $100,000 lighting rig as a $500 guitar, and the returns were better.

Eventually, I landed a job in Western Canada with a Danish company called Martin Lighting. I managed sales for their North American distributor and spent the next 12 years selling lighting for massive tours—Madonna, Michael Jackson, the Rolling Stones, the Eagles. It was an amazing experience, traveling the world and meeting incredible people.

By 2002, I got bored and decided to sell my shares and go out on my own. I’d always had that entrepreneurial drive, even when working for other companies.

Sjoerd:
So how did GearSource come into the picture?

Marcel:
Around that time, I bought a CD set by Seth Godin called something like "Making Money on the Internet." It was cheesy, but one of the stories stuck with me. He talked about a hippo and a bird—the bird eats the gunk off the hippo’s teeth. Disgusting for the bird, but it gets fed, and the hippo gets clean teeth. The lesson: build something that solves a big problem for someone else, even if it seems small to you.

At the same time, the industry I knew—lighting and sound—was moving fast. Technology was evolving, and gear became obsolete quickly. New models pushed old ones to the back of the shelf, and companies didn’t have a plan for that. They just kept buying new gear and ignored the growing pile of outdated stuff.

That’s where the idea came from. I didn’t even know the word “marketplace” then. I just saw a real, tangible problem and wanted to solve it online.

Sjoerd:
Did companies already know this was a problem, or were you ahead of the curve?

Marcel:
Larger companies with inventory managers saw it coming, but many ignored it. If you’ve got $10 million in inventory and a $1 million problem, you say, “We’ll deal with it next quarter.” But I’d seen it up close. My idea was to focus completely on that inventory—B-stock, used, discontinued items—while they continued selling the new stuff.

Sjoerd:
And what about the demand side? Who were you planning to sell all that old gear to?

Marcel:
That was the beautiful part. Manufacturers didn’t want to sell directly to competitors—but they were fine with me doing it. I’ve done six-figure deals where the buyer was just a block away from the seller, but they only went through with it because GearSource acted as the intermediary.

Sjoerd:
That’s wild.

Marcel:
Yeah. Originally, I thought manufacturers and distributors would be our main suppliers. But early on, a large rental company in Chicago—Upstaging—reached out and asked, “Can you do this for us too?” That changed everything.

Rental and production companies have even more inventory churn. They’re constantly replacing gear to meet tour specs. Someone says, “We need ABC light,” and even if the rental company has DEF light, they still have to go out and buy ABC and get rid of DEF. And they don’t have a disposal plan.

That’s when I realized the rental industry had a bigger problem than manufacturers. Today, 90% of our supply comes from rental and production companies.

Sjoerd:
How did you build the first version of the platform?

Marcel:
I called the most tech-savvy person I knew—Jamie. I told him, “Here’s the idea: we’re going to sell gear for other companies. We won’t own inventory. We won’t even see it.” He said, “That’s crazy,” and I said, “Yeah, but let’s try it.”

He used software from a UK company called Actinic. It came on CDs. We installed it on a server in my bedroom. It wasn’t marketplace software—barely even e-commerce—but it worked. That kept us going for a couple of years. In 2004, we launched our first proprietary platform, built on ColdFusion.

Sjoerd:
ColdFusion—wow. That’s ancient.

Marcel:
Yeah, and I think only government agencies still use it. We had a developer who didn’t build new features, just kept it from imploding.

Sjoerd:
Had you already shifted to the rental focus by then?

Marcel:
Yeah. By the end of 2002, Upstaging had reached out, and that pivot happened fast. The business model didn’t change—we just widened the scope of our supply side.

Sjoerd:
What happened after that? Did your customer base or model evolve?

Marcel:
Honestly, it was pretty linear growth. Same customer types, just more of them. We never advertised—our first digital ads were in 2024. For over 20 years, it was entirely organic.

Sjoerd:
At what point did you feel like, “Yeah, this is working”?

Marcel:
I made a deal with my then-wife: I’d take a second mortgage and empty our savings to fund this. At six months, I’d evaluate. By then, we had momentum. By twelve months, I had replaced my previous paycheck—about $15,000 a month. That’s when I knew it was real.

Sjoerd:
Did you change anything about how you made money? How did you monetize in those early days?

Marcel:
From day one, we used a fee-based model. We managed the listings, so if a seller wanted $1,000, we might price it at $1,200 and keep the difference. Our average take was about 22% early on, later around 18–19%.

But in 2019, when we got serious about growth, we made a big decision—we lowered our take rate. Today, it averages about 11%, and goes as low as 7% for high-volume sellers.

Sjoerd:
That’s counterintuitive—lowering margins to grow. What led to that?

Marcel:
A conversation I had with David Kalt, the founder of Reverb. In 2017 or 2018, we were in talks with him. Then he ghosted me—turns out he was selling Reverb to Etsy. Later he called and apologized, and gave me a lot of valuable feedback.

He said, “You’ve done something we couldn’t—you’ve gone upmarket. You’re selling million-dollar systems internationally. That’s impressive.” But he also gave me two critiques: one, investors want a tech co-founder—which I disagree with—and two, we were way too high-touch.

He was right about that. We hand-held every transaction, no matter the size. That doesn’t scale. He also said something that hit me: “You’re a marketplace.” Until then, I hadn’t even thought of us that way. That conversation completely changed how I thought about the business.

Sjoerd:
That’s huge. So when did you start calling yourselves a marketplace?

Marcel:
Around 2018 or 2019. That’s also when we did the first of three replatforms—in three years. Which, for anyone listening, please don’t do.

Sjoerd:
What did you move to?

Marcel:
In 2004, we’d built a ColdFusion platform and stayed on it for nearly 15 years. By 2019, it was time to move on. I didn’t want to build again—I wanted to find the Shopify of marketplaces.

We didn’t discover Sharetribe at that point. So we used WooCommerce with a plugin called Dokan, which turned it into a multi-vendor system. WordPress, WooCommerce, Dokan—it checked enough boxes, so we went with it.

Sjoerd:
That sounds painful.

Marcel:
It was. COVID hit, and our industry—live events—was the worst place to be. It became illegal to have events. Our customers’ revenue went to zero. The only upside was we had time to build.

We launched in September 2020. It was brutal, but it worked. That version of the platform introduced Stripe. For the first time, customers paid online, and we paid sellers automatically. No more checks or manual wires. That changed everything.

It proved we could automate, reduce touch, and cut margins—real marketplace behavior. We were no longer acting like a buy/sell company.

Sjoerd:
Did you go straight to Sharetribe from there?

Marcel:
No. We had one more stop, with another Sharetribe competitor. Total disaster. We lasted less than a year and migrated again—this time to Sharetribe. That was platform number four in four years.

Sjoerd:
We’re honored! But yeah, Sharetribe’s roots were in smaller marketplaces. We’ve been growing toward larger, more mature projects like yours. There’s a whole group of marketplace operators who’ve outgrown other solutions and don’t realize there are better options.

What’s been the biggest value for you with Sharetribe?

Marcel:
Honestly? Reliability. You guys are like Volvo—boxy, but good. It doesn’t have the craziest bells and whistles, but it works. After all those bad experiences, stability mattered most.

We knew what Sharetribe didn’t have going in—and none of those were dealbreakers. What it does have, it does very well.

Sjoerd:
So, after realizing you’re a marketplace founder, what advice would you give to others just starting out?

Marcel:
Great question. I’ve been running a marketplace since 2002. I’ve made every mistake possible, which is sometimes more valuable than just hearing from someone who had an easy ride.

First, validate the market. Make sure there’s supply and demand. I talk to founders who are super excited about their idea, but sometimes I just want to say, “That’s a terrible business.” I don’t always have the heart to tell them.

For example, our average order value is $20,000. That’s already hard. I can’t imagine doing this with a $3 AOV. A lot of marketplaces start with really low-value transactions, and unless you’re hyper-efficient, you can’t make that work. And efficiency usually comes with scale.

So, second piece of advice: start tiny. Be your only employee. Use tools, use AI. When I started, QuickBooks Online didn’t even exist. Now you can run an entire business solo with cheap or free tools.

Third: be conservative with expenses and aggressive with growth. Too many people raise money, then blow past their burn rate without getting traction. Don’t be one of those.

Marketplaces are hard, but when they work, they’re amazing. There’s nothing like waking up to $200K in weekend sales that happened without you lifting a finger.

Sjoerd:
I don’t play golf, but I get the picture.

Marcel:
Exactly.

Sjoerd:
Thanks, Marcel. That’s fantastic advice, and I think it’s some of the best we can give to early founders. Thanks for your time, for trusting us with your business, and all the best with GearSource.

Marcel:
Thank you so much.

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