Season 1, Episode 8

The end of free marketplaces with Ryan Gill (Communo)

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About this episode

How do you build such a good platform and community that people will actually pay just to be part of it? Ryan Gill of Communo hopes that free marketplaces will soon be a thing of the past. Listen to him tell the story of Communo, and how they built a community centered around giving and contributing before receiving. Communo is not your typical marketplace in a number of ways, and Ryan shares some very interesting opinions and advice that every marketplace entrepreneur should give a second thought.

Resources mentioned in this episode

No resources.


Transcript

(Auto-generated)

Ryan Gill: [00:00:00] What matter is what people believe you, and can you build trust in your marketplace between buyers and sellers, and will people pay you. I hope the days of marketplaces being free are over.

Announcer: [00:00:20] Welcome to Two Sided, the marketplace podcast, brought to you by Sharetribe.

Sjoerd Handgraaf: [00:00:25] Hi, I'm Sjoerd CMO at Sharetribe and I'm your host. For this episode, I talk to Ryan Gill, CEO and Co-founder of Communo, which is a marketplace that brings together freelances and agencies in the creative, marketing and advertising industry. It is a very strong community delayer where the focus is on giving before getting. Now what that means, you'll hear from Ryan, who is super passionate about this. It was very cool to hear Communo's story and Ryan has some strong and, perhaps, contrarian ideas about marketplaces, which has definitely given me something to think about. For example, about pricing in the marketplace, but also how to build a community and how to foster trust. I, of course, hope that this also gets you thinking about these things because that's the whole point of this podcast. So, sit tight and listen to Ryan Gill tell you about Communo. Hi Ryan. Welcome to the show.

Ryan Gill: [00:01:28] Thank you for having me.

Sjoerd Handgraaf: [00:01:30] Hey, just so the audience understands who's talking, and before we go down the marketplace rabbit hole, before Communo, could you tell a little bit about what you did before?

Ryan Gill: [00:01:39] Yeah. I've always been an entrepreneur, probably since I was 11 years old. I actually started selling golf balls I found on my local course and making a nice profit.

Sjoerd Handgraaf: [00:01:48] [laughs]

Ryan Gill: [00:01:48] As you can know, Sjoerd, uh, when you find stuff and get your brothers to work for you for free, and no cost of product, it's a pretty good high margin business. So I caught the entrepreneurial bug early. But my professional career really started in the advertising agency business. And I started my first, suh- digital agency when, when it wasn't very popular, in 99-2000. Built that up to be on the most well known shops in Canada and the US. Almost lost it though. It fel- almost failed. Well, we did fail actually and I basically pulled it off the ground and got it back in the air. And then we exited and sold the business in 2010 and '11. And then I, uh, started another business with the company that actually bought me, called Collective in 2011/12. And I still own that business today. And I'm a 50% owner but it's a self managing business. I'm a true founder. I like to build businesses up and then get out of the way and let others that know what they're doing ... So that's how I got started and how I got in the business. And what I'm in today, Communo, we actually built Communo. They say the best businesses are businesses you start for yourself. You don't make up some idea. You kind of, you know, solve your own problem. And one of the problems we had at Cult, some months we needed 200 employees and some months we needed 30 employees. That's a big problem. Right? The days of long term contracts and, and 10 year or five year, we call them agency record contracts in our business-

Sjoerd Handgraaf: [00:03:16] Yeah.

Ryan Gill: [00:03:16] ... are long gone. And, but the, the model still stayed true where you wanted to have tons of employees. So there w- it was just broken. And I say this with all kindness. I have friends that work in executive roles at Upwork and Fiverr but, I love them but I don't like their business. I feel like it ruins, uh, people's careers and it's a race to the bottom, you know? They would probably argue that. But-

Sjoerd Handgraaf: [00:03:36] Yeah.

Ryan Gill: [00:03:36] ... we used that platform and it didn't work for us so I just went out to build my own true verticalized marketplace. And our industry's extremely fragmented. And it was basically begging to be, you know, to have a platform for the whole industry. And so I, uh, went out and started that business, Communo.

Sjoerd Handgraaf: [00:03:53] Yeah. And so could you tell a little bit about what exactly is Communo? Right? Like what service do you get on Communo?

Ryan Gill: [00:04:00] Yeah. Communo is a, a marketplace for the advertising/marketing industry to give and get work. So for projects or long term contracts that are looking for talent, and for talent that is looking for work that doesn't wanna work full time. It's a luxury people have now and we're the leading marketplace for that in North America.

Sjoerd Handgraaf: [00:04:20] And because you said some interesting things about also some other well known companies, Fiverr, Upwork, we actually previously, on the podcast, uh, second episode, we interviewed Josh Brilinger, who was one of the, uh, earlier ones at Upwork. Could you explain a little bit then, how is Communo different?

Ryan Gill: [00:04:36] Yeah. So Communo is, uh, different in many ways, contrarian. One of the ways that we're different is everyone contributes. That's our operating model. Meaning they pay. And so, the supply side pays, the demand side pay. We are a subscription based business.

Sjoerd Handgraaf: [00:04:51] Okay.

Ryan Gill: [00:04:51] And we provide value to all sides of the marketplace. Now we're not a two sided marketplace. We have agencies and that's all different types of agencies. PR firms, digital firms, 72 different types of agencies. And then we have freelances. But then we also have brands that are now coming onto the platform. We're adding students. And then we're adding schools. And then we're adding media. And then we'll be adding associations. So I talk about ... Marketplaces work best when they go after fragmented industries. And Communo's definitely in that sweet spot. And so that's one way. We- everyone pays so that's ... And then the second way is it's vetted. So we have two different classes of citizens on our platform. One is verified, so we have AI and machine learning that looks, uh, deeply at whether the members that are applying are who they say they are. So we crawl ... If they say they're a copywriter, we'll check their LinkedIn-

Sjoerd Handgraaf: [00:05:47] Yeah.

Ryan Gill: [00:05:48] ... with our robots and our robots will check another website. We try to have three or four points of contact that actually says they are who they say they are. And so that's called a verified member. So we-

Sjoerd Handgraaf: [00:05:58] Yeah.

Ryan Gill: [00:05:58] ... checked that box. And then we actually have vetted members that go through one on one interviews. They pay a bit more to get the check mark. So one on one interviews and then we do, uh, case study reviews and reference checks. And so that's a super important way that we differentiate.

Sjoerd Handgraaf: [00:06:13] Yeah. Hey, actually, because there's a lot in there because this is actually ... I really looked forward to talking to you because Communo is quite special in the marketplace because indeed, like, I noticed you have multiple tiers in the member thing. But then also what I really like, what you said, everyone contributes. So could you tell a little bit more about the revenue model? So, is it a subscription on both sides or is there also still a transaction fee involved once a project, uh-

Ryan Gill: [00:06:38] Subscription on all six sides.

Sjoerd Handgraaf: [00:06:40] Yeah.

Ryan Gill: [00:06:40] So, um, the, every different player in the market pays a different fee and different level that we decide with them what the right value is. So pricing is a super important and magic part of a business.

Sjoerd Handgraaf: [00:06:55] Yeah.

Ryan Gill: [00:06:56] Could you imagine though, this new wave of platforms or marketplaces that is coming up, I like the word marketplace, could you imagine coming to a marketplace where, you know, just everybody was looking for something and no one was looking to give? They'd be pretty shitty marketplaces. And so that everyone contributes thing seems pretty, you know, simple to say but not a lot of people could pull it off. And-

Sjoerd Handgraaf: [00:07:18] No.

Ryan Gill: [00:07:19] ... we were just so aggressive about it that hey, if you're gonna come into Communo, your first thing to do is to give. It might be giving a job, it might be giving a connection, it might be just- be the first person to give. Don't look to receive. And I got-

Sjoerd Handgraaf: [00:07:32] Yeah.

Ryan Gill: [00:07:32] ... inspired by places like Burning Man. And our name is Communo and in a commune-

Sjoerd Handgraaf: [00:07:37] Yeah.

Ryan Gill: [00:07:37] ... everyone contributes in a different way. Now some contribute-

Sjoerd Handgraaf: [00:07:40] Yeah.

Ryan Gill: [00:07:40] ... more than others. Some contribute less. It doesn't matter, as long as you're coming in with a generous spirit. And so it's interesting to even try it in the marketing and advertising industry 'cause it's a very zero sum game. I don't know how much you know about the industry-

Sjoerd Handgraaf: [00:07:54] Well, I watched Mad Men.

Ryan Gill: [00:07:55] Yeah, yeah. It's very- that's a good example. It's very cutthroat. I win, you lose. So this is-

Sjoerd Handgraaf: [00:08:00] Yeah.

Ryan Gill: [00:08:01] ... very contrarian, what we're doing. But I think, for instance, the biggest companies in our industry are some holding companies that hold a bunch of these different bigger agencies. Even the word holding, in this day and age-

Sjoerd Handgraaf: [00:08:13] Yeah.

Ryan Gill: [00:08:13] ... is gonna be its demise. Right? We live in a sharing economy. And-

Sjoerd Handgraaf: [00:08:16] Yeah.

Ryan Gill: [00:08:17] ... platform economy. There's no holding any more. So those companies have millions of employees and hundreds of millions of revenue and I believe they're in a sharp decline. And their stock price would reflect that.

Sjoerd Handgraaf: [00:08:28] Yeah. So, I'm from Finland, where- like, or the whole company's from Finland. We're pretty, like, on the, let's say, left side of the spectrum regarding economics here. I think Canada, same story. However, like, going into the market, like, did you start with this model from the start? I mean, were you like, okay, this is how we're gonna do it? Or did this evolve over time? Because, I mean, this is really, well, like I said, this is a pretty interesting story. Like, could you tell a little bit, how did you end up here?

Ryan Gill: [00:08:53] Yeah. I read a book that your readers should check out by a guy named Nassim Taleb. It's called Skin in the Game. And I just happened to be reading that book when I came up with the idea, with my co-founder, for Communo. And, and in the book, essentially, Skin in the Game talks about when you have any sort of exchange or any sort of relationship, you want everyone to have equal, or close to equal, skin in the game. Otherwise, they will not value it. So-

Sjoerd Handgraaf: [00:09:19] Yeah.

Ryan Gill: [00:09:20] ... my belief was, although this is contrarian, if we can create enough value on the platform for the supply side and the demand side, outside of the transactional side of things, we can build a real community, build tools for them, build events, those types of things.

Sjoerd Handgraaf: [00:09:34] Yeah.

Ryan Gill: [00:09:35] Uh, we could command subscription payments. And I believed that that would also help weed out a lot of fakers-

Sjoerd Handgraaf: [00:09:42] Yeah.

Ryan Gill: [00:09:42] ... people that wannabe. And when everyone has skin in the game, ideologically, you care more about the outcome of the service or you care more about the outcome of the product, than how you were as a client. Because you're paying to be on there. And so, I, I, I have to also thank Upworks and Fiverrs of the world. They were pioneers. But I believe it being free, without using the air quotes, I know this is a podcast but air quotes for free, it's never free. When you know it's free, you know you're paying through the eye somewhere else-

Sjoerd Handgraaf: [00:10:11] Yeah.

Ryan Gill: [00:10:12] And so, the transaction take is always a bad solution in my opinion because it encourages disintermediation. And we don't care about that.

Sjoerd Handgraaf: [00:10:19] Yeah.

Ryan Gill: [00:10:20] We don't care about dis- we actually hope they go offline and meet each other. We hope they come back. But they're paying a subscription. So, to us, it's meaningful. Uh, really what people call us, and this is not me saying it, self describing, that's what, what our members call us is, if Tinder and LinkedIn were to have a baby, in the advertising/marketing industry, it would be Communo because we're, we're part matchmaker but we're part, uh, you know, professional network and, you know, profiles. So you don't apply for jobs on our platform. You don't go in and type in what, you know, I'm good for this job.

Sjoerd Handgraaf: [00:10:50] Yeah.

Ryan Gill: [00:10:50] Your profile is your application. So we've removed as much friction from the system as possible. And, uh, we allowed also for tribe building, which is huge. And so, it's been a fun ride. Listen, we're only two and a half years old, three years old. We're extremely-

Sjoerd Handgraaf: [00:11:04] Yeah.

Ryan Gill: [00:11:04] ... successful revenue-wise, but we have a ton of problems still. And we have stuff we're trying to figure out. The vision for this was to enable economic option for every person and business in our industry, leaving no one behind. That was our vision.

Sjoerd Handgraaf: [00:11:18] Yeah.

Ryan Gill: [00:11:18] And sometimes when people hear that, they think only for small and mid size companies. But no, it's for everyone. But, you know, the bigger firms seem to think that we are here to take them out and we're not.

Sjoerd Handgraaf: [00:11:29] Yeah.

Ryan Gill: [00:11:30] But if they don't get on board, they will be taken out because if you don't embrace platforms or marketplaces, you're gonna be out of business.

Sjoerd Handgraaf: [00:11:37] Yeah. Could you talk us through, like, how would one sort of transaction or a project ... So I'm representing a brand or I'm an agency and I ask to shoot a commercial or, I don't know, I don't know is that a good example, but-

Ryan Gill: [00:11:48] Yeah. Let me tell you a great story.

Sjoerd Handgraaf: [00:11:50] Yeah.

Ryan Gill: [00:11:50] I think it'll help people understand. And I bet you, most of your users, or your listeners, will know this story. So, there's a guy named John Krasinski. Used to be on The Office. He's now, I think, John Ryan or Jack Ryan on a TV show. Anyways, he and his business partner had a company which I didn't know about called Sunday Night Productions. And [inaudible 00:12:09] to my knowledge, we have, uh, over 37000 people on our platform now and growing every day by thousands.

Sjoerd Handgraaf: [00:12:15] Yeah.

Ryan Gill: [00:12:15] But he had a production company and he wanted to produce a show called Some Good News. Have you heard of it?

Sjoerd Handgraaf: [00:12:21] Uh, yeah. That was the thing that came up when, at the beginning of this, uh, yeah.

Ryan Gill: [00:12:25] Yeah. It's got billions of views.

Sjoerd Handgraaf: [00:12:27] Yeah.

Ryan Gill: [00:12:27] And it became the most famous show during the pandemic around the world-

Sjoerd Handgraaf: [00:12:31] Yeah.

Ryan Gill: [00:12:31] And, uh, he actually ended up selling it to ABC in eight weeks. The fastest show to ever sell as well-

Sjoerd Handgraaf: [00:12:37] [laughs]

Ryan Gill: [00:12:37] ... in history. But-

Sjoerd Handgraaf: [00:12:38] All right.

Ryan Gill: [00:12:39] ... he needed help. Uh, he wanted to do this show about good news. We were in the middle of a pandemic and all you do is turn on the TV or the internet and you see bad news.

Sjoerd Handgraaf: [00:12:48] Yeah.

Ryan Gill: [00:12:48] Um, but he couldn't hire 'cause he couldn't go to Hollywood and get videographers, producers, writers-

Sjoerd Handgraaf: [00:12:53] Yeah.

Ryan Gill: [00:12:54] ... GIF-alytics people, you know, the list goes on. So bing, bing, bing, bing, bing. He's on our platform, posts a bunch of jobs. Those jobs are filled within three days. The show is live with those people that he hired on our platform and paid. Three days later, six days after, from idea to posting, he's launched his first show and that show gets 16 million views. That's a really great story from a celebrity that everyone-

Sjoerd Handgraaf: [00:13:19] Yeah.

Ryan Gill: [00:13:19] ... knows about around the world. And it's went on to do, uh, famous things. However, that happens every day on our platform a lot. Uh, at the moment, we have, I don't wanna screw up the number, but it's over $250 million of deal flow on our platform today.

Sjoerd Handgraaf: [00:13:33] Wow.

Ryan Gill: [00:13:34] The average deal size is $64,000.

Sjoerd Handgraaf: [00:13:37] Okay.

Ryan Gill: [00:13:37] That's massive. It's not even in the same realm as these other gig economy websites. So people can build careers on our website. We're not a gig website. We're a true platform to have a career and to have a portfolio career.

Sjoerd Handgraaf: [00:13:52] So actually, I'm curious, like how did your AI bot react to John Krasinski scanning the net?

Ryan Gill: [00:13:57] Well, he signed up to be a vetted member.

Sjoerd Handgraaf: [00:13:59] All right.

Ryan Gill: [00:13:59] Um, so we did the, uh, human to human interaction-

Sjoerd Handgraaf: [00:14:02] Yeah.

Ryan Gill: [00:14:02] ... but verified members ... So how do people, are you asking how people get-

Sjoerd Handgraaf: [00:14:06] Yeah, so I mean, like, yeah. Exactly. I'm on the platform. I have a profile there. I've done a couple of jobs. How do I get a new job on your site?

Ryan Gill: [00:14:13] You work hard. You work hard. I know that sounds very trite. But I'll, I'll-

Sjoerd Handgraaf: [00:14:17] Yeah.

Ryan Gill: [00:14:17] ... want your listeners to hear this loud and clear. Platforms and marketplaces are not easy work. They're hard work. They're actually harder. It's a global economy. A lot of people show up to our platform and say where's the work? Well, is your profile the best? Not just one of the- is it the best on the platform? No. Most people aren't. Are you messaging other people? Have you posted a job yourself? You have to be active in the community. Think about any sort of community you go into. Sjoerd, you are, seem like a nice guy. Your friends, that your friends with, they would stop being friends with you if every time you came to a house party or you came into a group setting and say, hey, what, what do you got for me? What do you got for me? Hey, you got-

Sjoerd Handgraaf: [00:14:56] Yeah.

Ryan Gill: [00:14:56] ... anything for me? That is icky on a platform or off a platform. So I don't-

Sjoerd Handgraaf: [00:15:00] Yeah.

Ryan Gill: [00:15:00] ... want to help people who are thinking, and I'm very passionate about this, is people say how does it work? You have to work.

Sjoerd Handgraaf: [00:15:06] Yeah.

Ryan Gill: [00:15:06] You have to work. And you have to have a great profile. And you have to connect with people. And it's like a gym membership. If- you don't just show up and get a six pack. I'd love that, right? So it's a really big learning curve. I think people expect it to just happen. Now, I believe it works better than the traditional analog world of getting on planes or going out to networking events. If you work-

Sjoerd Handgraaf: [00:15:28] Yeah.

Ryan Gill: [00:15:28] ... really hard at it and you understand the platform, how it works, we have people on our platform that make millions of dollars.

Sjoerd Handgraaf: [00:15:34] Yeah.

Ryan Gill: [00:15:34] We have people that make zero. The people that make zero, they don't try. Some are confused because it's a new way-

Sjoerd Handgraaf: [00:15:41] Mm-hmm [affirmative].

Ryan Gill: [00:15:42] ... so we've opened up, oh, touch this, we've opened up a new thing called CAF, Communal Adoption Framework. So we've opened up this professional services side of our business.

Sjoerd Handgraaf: [00:15:50] Yeah.

Ryan Gill: [00:15:50] If you want training, if you wanna kill it on Communo, like others are-

Sjoerd Handgraaf: [00:15:55] Yeah.

Ryan Gill: [00:15:55] ... sign up for the training and get really good at it.

Sjoerd Handgraaf: [00:15:58] Yeah. And then, let's say I'm a videographer, you say, like, the idea is to give. Like, how do I give? Like what does it mean in practice?

Ryan Gill: [00:16:04] Really easy for a videographer. If you wanna scale your business, you have projects. You clearly have projects if you're a videographer-

Sjoerd Handgraaf: [00:16:12] Yeah.

Ryan Gill: [00:16:12] Look for a job that you have that may be beneath you or below you.

Sjoerd Handgraaf: [00:16:16] Yeah.

Ryan Gill: [00:16:16] And be the director of that one. Say it's five grand.

Sjoerd Handgraaf: [00:16:19] Okay.

Ryan Gill: [00:16:19] Put it up for four grand. You're still making your thousand dollars. Take a chance and hire someone. You never know how good you need to be on the supply side until you're on the demand side. And-

Sjoerd Handgraaf: [00:16:30] Yeah-

Ryan Gill: [00:16:30] ... I tell people that all the time. It's such a good insight, right? Again, that everyone contributes. As soon as they do it, first of all, they realize, oh, I actually make more money on the demand side.

Sjoerd Handgraaf: [00:16:41] Mm-hmm [affirmative].

Ryan Gill: [00:16:41] 'Cause I didn't have to do anything. I hired someone.

Sjoerd Handgraaf: [00:16:43] Yeah.

Ryan Gill: [00:16:43] They did a great job. I took my cut. Number two is, we call them copilots, but find someone on the platform that's doing well. And ask them how they do it. And, you know, go to events. Before COVID hit, we're in 250 cities. We have a partnership with Spaces, they're owned by Regis-

Sjoerd Handgraaf: [00:16:59] Yeah.

Ryan Gill: [00:16:59] ... and we're in a global partnership with them. And so every month, if there's enough people in that city, say in, you know, Berlin, or in, uh Portland, Oregon-

Sjoerd Handgraaf: [00:17:06] Yeah.

Ryan Gill: [00:17:06] ... or in Vancouver, we have something called Member Blenders and go to those, show up, meet people in real life.

Sjoerd Handgraaf: [00:17:13] Yeah.

Ryan Gill: [00:17:13] So there's many ways to do well but for a videographer, it really is, I still stand by, give first, and there's lots of ways to do it.

Sjoerd Handgraaf: [00:17:22] Yeah, no, that's the part I wasn't sure about. Like how am I giving? What do you mean? Basically, if I also, if I would get other projects which would need, whatever, an animator, I would throw it out to someone else in the network. Is that what you're saying?

Ryan Gill: [00:17:32] Yeah. Break your job down. Yeah. It's really beautiful. And also, be a cheerleader. If someone's listening to this on the Communo platform, say 10 people bid on a job-

Sjoerd Handgraaf: [00:17:41] Yeah.

Ryan Gill: [00:17:41] ... and only one can get it. Say there's 10, one gets it, so nine disappointed people-

Sjoerd Handgraaf: [00:17:45] Yeah.

Ryan Gill: [00:17:46] ... in our platform, eight of those people actually cheer the other person on. They're like good job. They don't think of it as this scarcity game. They think of it as abundance. And then there's the one person that's, you know, jealous or envious. And that's fair. But becoming a broker themselves is a powerful thing. And I think when people actually get it and it clicks, it's amazing. I believe there could be a day that, you know, there isn't a need for agencies. Now I own one myself, so I'm talking myself out of a job, but, but the world of the internet, that's taken away all the middle men. Right? And the agencies-

Sjoerd Handgraaf: [00:18:19] Mm-hmm [affirmative].

Ryan Gill: [00:18:19] ... and think about the word agency, that's all it is, is a broker. And so there's lots that people can do. I wanna make sure I'm very clear that I don't lack compassion or empathy. It's hard, you know, maybe you fish in a lake, that was traditional analog business. Fishing on a platform like ours, or any platform for that matter, eh- and learning how to use it, is like fishing in the ocean. You need a different boat. You know, sometimes you need a spear. Sometimes you need a [crosstalk 00:18:43]-

Sjoerd Handgraaf: [00:18:43] Yeah.

Ryan Gill: [00:18:43] ... it's so important that you get help. And you just can't show up. There's just nothing in life you can just show up with and, you know, make it happen.

Sjoerd Handgraaf: [00:18:52] Yeah. Hey, but then, because this is, uh, again, like extraordinary platform, how did you end up here? Like what was your first version? We talked a little bit about, so in the Cult Collective, you felt this problem of scaling where you sometimes needed 200 people, otherwise 30 people. Could you talk a little bit about through the, whatever, the first six months or something, like, you know, what was your first version like? How did that work? 'Cause I've never heard this come out like this. So I wonder where did it start?

Ryan Gill: [00:19:18] We had no clue what we were doing. I wish I knew about you guys because we wasted a lot of time and money. My partner and I put in $500,000 of our own money. That's a lot of money. And that was a big risk. And so we started just building. There was a gentleman we hired, had a company, I think it was called Rocket Taxi or something like that. But he had built a two sided marketplace before Uber and didn't succeed, obviously, like Uber did. And he actually lived in our town. And I hired him as our first product guy. We got something off the ground. You know, it was SFD. I don't know if you followed Brené Brown at all, or know that name Brené Brown-

Sjoerd Handgraaf: [00:19:52] No, doesn't ring a bell. Sorry.

Ryan Gill: [00:19:53] She's a great author. But she has something called SFD, Shitty First Draft. And so you just need to put out-

Sjoerd Handgraaf: [00:19:59] [laughs]

Ryan Gill: [00:19:59] ... a shitty first draft or an NVP. And so we got it out, but luckily we have a, we are not perfect, my founder and I, but we have pretty good names in the industry.

Sjoerd Handgraaf: [00:20:08] Mm.

Ryan Gill: [00:20:08] And so we told our friends about it and we started getting our first clients. And you can imagine out of the gate, because one of our core principles was everyone contributes and it was, you pay right away, and our product was not wonderful. So we were very upfront in our sales pitch. Like hey, you're part of our pioneer club. Like you're going to be a guinea pig. We need to make money to make it great for you. And so it's going to cost a little bit of money.

Sjoerd Handgraaf: [00:20:33] Yeah.

Ryan Gill: [00:20:33] And we started just charting customers. And we were the first customer. So we built it for Cult. And we became the first customer. So we paid, uh-

Sjoerd Handgraaf: [00:20:41] Fair enough.

Ryan Gill: [00:20:42] ... I guess the Genesis member. And then people that worked for Cult, every year we, you know, handed out $2-3 million to freelancers, so we asked all them to join as well and pay to be on this platform, and maybe share work around rather than just be in one source of income from us. There's work for all of you. And they, when we announced it, you know, they had to pay, I expected ... There was probably a hundred people showed up at the kick off meeting, of vendors and people that we use. And said, you know, to work with Cult, now you have to be a Communo member-

Sjoerd Handgraaf: [00:21:11] Yeah.

Ryan Gill: [00:21:11] ... so that was, uh, the switch. And it was like, listen, it's just how it's gonna be. You know? Uh, and part of me was like, the, the story goes, I was sick of handing out a hundred thousand dollars, $500,000 checks, and people expecting it.

Sjoerd Handgraaf: [00:21:24] Yeah.

Ryan Gill: [00:21:24] And not so much as even getting a Christmas card from people. So I said, all right, that's fine. You know, they do good work. That's all we expect-

Sjoerd Handgraaf: [00:21:31] Yeah.

Ryan Gill: [00:21:31] Well then, to start working for us, they have to pay us to be on our platform. So that's how we started-

Sjoerd Handgraaf: [00:21:35] [laughs]

Ryan Gill: [00:21:35] ... it was a bit rough. But-

Sjoerd Handgraaf: [00:21:37] Yeah.

Ryan Gill: [00:21:37] ... a hundred people showed up. And I said to Chris, my co-founder, I said, "Chris, I, I just wanna let you know before we go in this meeting, I think, you know, like 90 people are gonna tell us to F off.

Sjoerd Handgraaf: [00:21:47] Uh-huh-

Ryan Gill: [00:21:48] And, uh, 10 will say sure and we'll start with those 10. And-

Sjoerd Handgraaf: [00:21:51] Yeah.

Ryan Gill: [00:21:52] ... to my surprise, and I still can't believe it to this day, it was like, it was the other way around. 10 people told us to F off and 90 people said sign us up. And, um-

Sjoerd Handgraaf: [00:22:00] All right.

Ryan Gill: [00:22:00] ... those people went on to make a lot of money on our platform 'cause they were the early adopters.

Sjoerd Handgraaf: [00:22:04] Yeah. So the first version was basically, uh, well, let's say you on the demand side, right, and then-

Ryan Gill: [00:22:09] Yeah.

Sjoerd Handgraaf: [00:22:10] ... the supply side [laughing] your already existing suppliers?

Ryan Gill: [00:22:12] Yeah. Exactly [laughing].

Sjoerd Handgraaf: [00:22:13] Yeah, because we often, like I've also realized this while talking to marketplace entrepreneurs and experts, and the most successful marketplaces, they constrain the marketplace early on in some way. So, like, geologically, if you're a local marketplace where location's important or type of product or category or type of work in your case. Did you do anything like that?

Ryan Gill: [00:22:33] Yeah. So we started in, we call them provinces here. I don't know if you-

Sjoerd Handgraaf: [00:22:37] Yeah.

Ryan Gill: [00:22:37] ... call them states where you are. We started in Alberta, in Calgary. Calgary's a pretty big city. It's about a million and a half people. And so we had a lot of, you know, friendlies. Also in your hometown, you're also, I say friendly but I can remember half the marketplace saying what the hell are these guys doing? It's such a scam-

Sjoerd Handgraaf: [00:22:56] Yeah.

Ryan Gill: [00:22:56] ... you know? Truthfully, that kind of hurt, you know? You want people in your industry to cheer you on, to try to make something better for everyone in the industry. But a lot of people doubted us. And that's fair. That's part of the game. Uh, but we were lucky. And then we went to Edmonton, which is just up the road three or four hours from us.

Sjoerd Handgraaf: [00:23:11] Yeah.

Ryan Gill: [00:23:11] And then Canada's pretty easy to travel around so then we quickly went to Toronto and Vancouver and scaled quickly.

Sjoerd Handgraaf: [00:23:17] Yeah.

Ryan Gill: [00:23:17] And we were clear that in our first six to 12 months we would only stay in Canada. We didn't wanna burn too much money. And we hadn't raised any outside capital yet. But then when, uh, we started seeing traction and we, you know, we hit our first 10, 25,000 MRR-

Sjoerd Handgraaf: [00:23:32] Yeah.

Ryan Gill: [00:23:33] ... uh, that's just from subscriptions only, not talking about GMV. It started to take off and we quickly became the biggest in Canada.

Sjoerd Handgraaf: [00:23:40] Yeah.

Ryan Gill: [00:23:40] Partly because we were the, one of the only ones.

Sjoerd Handgraaf: [00:23:42] Yeah.

Ryan Gill: [00:23:43] It's not hard to be the biggest when you're the only one. But then we started seeing some competitors and we got lucky and found one that was a little bit tired and they were a bit early.

Sjoerd Handgraaf: [00:23:52] Hm.

Ryan Gill: [00:23:52] And we ended up acquiring them, which helped our growth a lot. We were well capitalized. We were making money and they hadn't been. But they had, uh, great access to freelancers. So if anyone's listening out there thinking about starting a marketplace, uh, the best advice I have to you is just start.

Sjoerd Handgraaf: [00:24:07] Just start. Yeah. No matter what. And then very early on, like referring to the beginning of the conversation, you said like we're a multi-sided marketplace so you have the brands, or the last one, like, was an association, but everything in between. Was that also part from the early one or what made you decide to add that on? Like because, that is sort of the other way than you expect, so there's a lot of like lift constraints. So can you tell me a little bit about how that came about?

Ryan Gill: [00:24:31] As I said, just start. You don't have to wait, you can start but you can gradually change as you go. So actually, that's a great question because, to show how wrong I was. I only wanted to have freelancers from our industry and agencies, no clients allowed. I wanted us to ha- be two-sided.

Sjoerd Handgraaf: [00:24:48] Yeah.

Ryan Gill: [00:24:48] Private. 'Cause I felt, and I still stand by it, most clients treat creatives and agencies poorly.

Sjoerd Handgraaf: [00:24:54] Mm-hmm [affirmative].

Ryan Gill: [00:24:54] And so I wanted to keep them out. And I thought, ideologically, that agencies understand how to price properly 'cause they get ground down on their prices and they would treat, you know, the talent well, good because it was, they were one of them, right? And-

Sjoerd Handgraaf: [00:25:06] Yeah.

Ryan Gill: [00:25:06] ... that was true. I, I was right about that. They paid them well. They treated them well. Timelines were reasonable.

Sjoerd Handgraaf: [00:25:12] Yeah.

Ryan Gill: [00:25:12] So we built a great marketplace. What I didn't realize though was a trend that was happening in our industry that, when I started about 50-some percent of brands, I think it was 51% of brands, had in-house marketing agencies and their own teams.

Sjoerd Handgraaf: [00:25:25] Yeah.

Ryan Gill: [00:25:26] Since we started three years ago, that's grown to over 80%. So I was losing a huge percentage of the market by not allowing brands. So I started to change my mind, my board helped me a little bit with that. And I had some great consultants I wanna shout out. A guy named Douglas Atkins, he lives in Italy now. But he was one of the original CMOs of Airbnb.

Sjoerd Handgraaf: [00:25:46] Okay.

Ryan Gill: [00:25:46] He's the one that told me, "Ryan, there's great companies out there that don't treat agencies or creatives bad. They treat them good. And so why don't you open it up?" And so, as soon as I open the floodgates and all right, let's have brands on here, I started to say, "Wait a minute. If we do this right, we can digitize the whole industry if we bring media on." You know, I started looking at LinkedIn and I was like, "When's the last time I even saw anything meaningful to me? This is so big." And, and kudos to LinkedIn. I have friends that work there as well. But I think you'll see over the next five, 10 years, the verticalization of LinkedIn. And I wanted to have media that was relevant to me. And when I say media, I mean user-generated content. I mean, you know, syndicating other periodicals in our industry. Even though we might be, you know, LinkedIns, uh, 54, 50- I don't know how many ... There's hundreds of millions of people.

Sjoerd Handgraaf: [00:26:36] Yeah.

Ryan Gill: [00:26:36] And, you know, even though our marketplace might only be a million or two people and maybe it'll only, at the max, be 10 million people, that's a very meaningful 10 million people 'cause they're all in the same industry. So we turned on brands. The data goes live in July, so tomorrow. That's crazy.

Sjoerd Handgraaf: [00:26:51] Yeah.

Ryan Gill: [00:26:52] Uh, media will come next and then students. And then we've decoupled students and schools. We think schools are different. But students, allowing them to ... It's such a fragmented marketplace to even know where they wanna go, starting to get to build relationships early. And then associations last. And, you know what? There'll probably be more pieces-

Sjoerd Handgraaf: [00:27:10] Yeah.

Ryan Gill: [00:27:10] ... that I haven't thought about. But definitely technical businesses like Adobe or like, product businesses that leak into our industry, they're part of our platform as partners as well. So it became a fairly large and robust marketplace, but that's what it should be. And, uh-

Sjoerd Handgraaf: [00:27:26] Yeah. Oh, this sounds great. Like, so what would be the role, I'm not sure, clear if I understand what would be the role that students kind of play on your platform? Like how would that work?

Ryan Gill: [00:27:34] Yeah. Huge role. Well, they're the next generation, right? And so, for them first, they need to understand what jobs are even available. They don't get taught that in school.

Sjoerd Handgraaf: [00:27:43] No.

Ryan Gill: [00:27:44] Do I wanna be an account manager? A project manager? Am I a creative director? Am I a writer? Am I ... What am I?

Sjoerd Handgraaf: [00:27:45] Yeah.

Ryan Gill: [00:27:45] And do I wanna work agency side? Do I wanna work at a tech company? Or at a brand in house? A client side? So we need to help them bridge that gap and to meet other, you know, students from around the world that are interested-

Sjoerd Handgraaf: [00:28:01] Yeah.

Ryan Gill: [00:28:02] We all know that the world is, uh, global now and so just because you went to school in, you know, New York City, you know, your co-founder to start the next agency might be in Singapore.

Sjoerd Handgraaf: [00:28:12] Uh-huh.

Ryan Gill: [00:28:12] And we allow that to happen. So allowing the most talented people to come together, regardless of the location, especially for students, will be huge.

Sjoerd Handgraaf: [00:28:20] Yeah.

Ryan Gill: [00:28:20] And then I think, you know, they'll be self forming tribes. And so if we didn't have students, we literally are not building for the future and we're just building for now. So, no, we need students. And I'm gonna go back as far as grade school. We're probably gonna go down as far as ... I think probably 12 or 13 that you can join. Because-

Sjoerd Handgraaf: [00:28:38] And then you can do work there?

Ryan Gill: [00:28:40] Yeah. Why, of course. Yeah, why work at Starbucks when you can work ... You might be smart enough at 14 or 15 to write some copy. And it might be amazing copy. Or maybe you're great at art already. Who said you gotta wait 'til you're 18 to start-

Sjoerd Handgraaf: [00:28:51] Yeah, yeah-

Ryan Gill: [00:28:52] ... a job? So why can you work at the coffee shop or why can you work at McDonald's? Why can't you work at an agency or a brand? You can. But it's never been available. And the talent hasn't been able to find and discover. So a platform like ours opens it up wide open. And so our schools and students will be coming on. And why students are even more important is, especially when it comes to internships, allowing them to find that, their favorite, their, the person they wanna work for not just in their city, but around the world, is huge. And so, it's also great for agencies and brands, they, most of them have a mandate to have students-

Sjoerd Handgraaf: [00:29:25] Oh really?

Ryan Gill: [00:29:25] ... in internships. But again, they just play in their own sandbox and-

Sjoerd Handgraaf: [00:29:29] Yeah.

Ryan Gill: [00:29:29] ... the world's a big place. So it's quite amazing. Also, students typically aren't exposed to periodicals like Brand Week or Ad Week, at-

Sjoerd Handgraaf: [00:29:37] No.

Ryan Gill: [00:29:38] ... at least for the older- But now they're gonna be on our platform. They're gonna see media on our platform, you know, learning about stuff that's happening in the industry that, that one day that they'll be excited about. It's great to be a doctor and a lawyer and we learn about that. You know, my daughter, your kids, they don't know if they wanna be a marketer or an advertiser.

Sjoerd Handgraaf: [00:29:56] [laughs] I kind of hope not. Yeah.

Ryan Gill: [00:29:58] [crosstalk 00:29:58] Yeah, why, why not?

Sjoerd Handgraaf: [00:29:59] Yeah, yeah.

Ryan Gill: [00:29:59] It's, if you're promoting great things, you know-

Sjoerd Handgraaf: [00:30:02] Yeah.

Ryan Gill: [00:30:02] ... uh, I think it's pretty awesome to be the CMO or the lead marketer for UNICEF or, you know, or a great company.

Sjoerd Handgraaf: [00:30:08] Yeah.

Ryan Gill: [00:30:09] Marketing and advertising gets a bad name because it's, a lot of advertising's bad. It's just selling people shit. True marketing and true advertising and true product development is marketing. Marketing's four things. It's price, product, placement, which is distribution, and promotion. But we only focus on promotion. Like ads. Like marketing's so much more than that.

Sjoerd Handgraaf: [00:30:29] Yeah.

Ryan Gill: [00:30:29] And so, that's why students are really important.

Sjoerd Handgraaf: [00:30:31] That makes sense. Yeah. No I'm just a little bit joking because like recently here with the whole pandemic, we had this like list of, you know, crucial jobs, like who's allowed to bring their kids to day care. And, uh, who's allowed to, you know, like ... And, uh, my wi- my wife [laughing] she works in healthcare so now the joke is that my job's not crucial. That's why I'm like, well, I hope she's not gonna be a marketer. But yeah, where are you at right now? Have you already expanded to the US? Is that coming? Could you tell me a little bit about that?

Ryan Gill: [00:30:56] Yeah. So we expanded to the US six, seven months ago. And we'll continue-

Sjoerd Handgraaf: [00:31:00] Yup.

Ryan Gill: [00:31:01] ... uh, we're being constrained in our growth on purpose. We have a lot of work to do on the product. We always will. Uh, but it's not ready for prime time globally. Obviously, cultures, languages, you just don't lean into that easily. We have some spies on the ground in Germany. Then we have some spies on the ground in Asia. And when I say spies, just people looking at the market for us. And we have to figure out what to do there and be ready to go. Come 2021, we'll go into English speaking Europe. And then probably we'll choose one of the Asian countries that we feel most comfortable with. Probably Singapore or something like that. And then end of 2021, we'll hopefully by that time, we'll be about five years old, four and a half, five years old. We'll be ready to go global. And I think for your listeners out there, it's really important, you know, I think 2021/22 we'll just be getting started. Like, marketplaces take five years minimum to get going. And so I don't know that much about Sharetribe. I'm gonna check you guys out more. But this is, if the service you have what you're talking to me about is true, it's so important because you don't need to go big right away. Just gotta get going and try, you get stuff going, because you'll learn a lot in those early days. And we blew through lots of money trying to figure out the technology ourselves. And I wish we had met you sooner.

Sjoerd Handgraaf: [00:32:17] Yeah.

Ryan Gill: [00:32:17] Uh, but the future is platforms. The future is marketplaces.

Sjoerd Handgraaf: [00:32:20] Yeah.

Ryan Gill: [00:32:20] This isn't a fad. It's not the future, it's now too.

Sjoerd Handgraaf: [00:32:22] Yeah. No, I'm obviously very happy to hear that. I mean, like our goal is to democratize the sharing economy. Or to democratize actions to marketplaces. And indeed, like previously, there was always the barrier of, like the technical barrier. Like you need to get a coder, you need to get someone like the guy you hired. And in order to get someone like that, you need lots of capital and it's really like our mission to sort of make this, you know, that you can get your shitty first draft or MVP out at max speed and minimum cost so that you can figure out like, hey, is my idea actually any good? Because, like, as you probably also would know well, like your idea might just be not so great. Or the way you had thought it initially might just not fly. So really happy to hear that from an experienced person like yourself.

Ryan Gill: [00:33:03] Yeah. When it comes to the marketplaces, people will disagree with me on this. But the product doesn't matter. It's different than software or tech. And let me explain that, okay? Of course the product mattered. But it doesn't matter out of the gate. It just has to work a little bit. What matters is will people believe you? And can you build trust in your marketplace-

Sjoerd Handgraaf: [00:33:23] Yeah.

Ryan Gill: [00:33:23] ... between buyers and sellers? And will people pay you? If it's a business, unless you're doing a charity, but will people pay you to be on it? And I hope the days of marketplaces being free are over. I hope they hear this podcast. I hope it goes out in history as one of the ones that mattered. Because if you have a marketplace of any sort that you go to and set up shop in a community, for the most part, there's some sort of rake to the person who sets it up. And-

Sjoerd Handgraaf: [00:33:49] Yeah.

Ryan Gill: [00:33:49] ... if a marketplace founder's out there, just say it costs money. It's expensive to build these things and it's a lot of work. And you're valuable. Just remember that. Like as you build and you found these things, have confidence because you don't have to give stuff away for free and try to take it on the back end. To me, that's shady business. You know, a lot of people-

Sjoerd Handgraaf: [00:34:06] Yeah.

Ryan Gill: [00:34:06] ... disagree with me. We'll see who wins in the end. But companies like Costco and Amazon Prime and these companies that charge memberships, they seem to be doing okay. People wanna feel part of something and they're willing to pay for it to be part of it.

Sjoerd Handgraaf: [00:34:18] No, I agree. And I think you're also, I mean, there's a couple other reasons why. First of all, I think, if you're starting, probably the best way is to get a membership because, like, you might not have enough transactions to get like, to generate enough money if your take rate's super low. And then also, like we just said about inde- like the product's not the most important thing. I don't remember who said it, but basically someone, I think someone said it like your liquidity is your product, right? Like it doesn't matter in what shape or form it is, it's just that if there's no match, it doesn't really matter. All right. Is there anything you would have done differently that people can take away? Like oh, uh, we did this and I would recommend everybody to think twice before they do this or that?

Ryan Gill: [00:34:55] Yeah. I hired a few people early on that had big titles. Like at Salesforce or Google. And for those Google and Salesforce out there listening, I'm sure there's great ones, but don't fall for that head fake. And those people that I had to let go are good people. But just because they had success at, which are now massive companies, doesn't mean you'll have success at your company. And-

Sjoerd Handgraaf: [00:35:15] Mm.

Ryan Gill: [00:35:15] ... when you do hire them, if you do, and you know they're not working out, it's just classic advice, you gotta just make the call to let them go sooner. And I, I didn't do that. So I made some big mistakes on people because I, I fell for the head fake of what they used to do or what they did-

Sjoerd Handgraaf: [00:35:29] Yeah.

Ryan Gill: [00:35:30] ... rather than what they can do now. You know? And I put lots of, just, uh, for the listeners, this isn't a shameless plug, but I actually think it can help, I, I play with content every day on Instagram and LinkedIn called Ryan Gill Shares. That's the handle. It's @RyanGillShares. And I talk about not the good stuff. I talk about the screw ups.

Sjoerd Handgraaf: [00:35:46] All right.

Ryan Gill: [00:35:47] Because that's, it's a series ... I don't know if you've heard this quote before. But great entrepreneurs, successful entrepreneurs are able to go from failure to failure without losing excitement.

Sjoerd Handgraaf: [00:35:56] Yeah.

Ryan Gill: [00:35:56] And, uh, that's true, right? Or, uh, I think I, I butchered the quote. I think it's failure to failure without losing enthusiasm.

Sjoerd Handgraaf: [00:36:02] Yeah.

Ryan Gill: [00:36:03] And that's, especially in a marketplace, is they are the hardest businesses. And su- also if you're listening, if you don't have, like, thick skin and you don't have staying power, just don't do it. They're the hardest businesses to build. I've built big businesses before. This is my fifth or sixth business. So I've had a couple successes and a couple failures. This, by far, is the most amazing, exciting journey, but it's, we're still early. It's a very hard business. We can easily fail still. And so-

Sjoerd Handgraaf: [00:36:28] Yeah.

Ryan Gill: [00:36:28] ... I think about that every day. And I tell my team, like, uh, we look paranoid every day.

Sjoerd Handgraaf: [00:36:33] All right. Hey, let's end on that [laughing] let's end on paranoia. That sounds great-

Ryan Gill: [00:36:38] Yes.

Sjoerd Handgraaf: [00:36:38] Thank you very much, Ryan. Do you wanna do a final plug on where people can find Communo or something you want them to do?

Ryan Gill: [00:36:44] Yeah. We, uh, at the moment, during COVID, for all freelancers, we just talked this whole podcast about being you pay, but for freelancers right now that are looking for work, uh, we have a promotion that it's free for the first few months. So you can go to Communo.com and sign up. Or download Communo on the Apple IOS store or on Android. And if you wanna follow me, you can check me out at Ryan Gill Shares on Instagram.

Sjoerd Handgraaf: [00:37:07] All right. Thank you very much. Announcer: [00:37:10] Thank you for listening to Two Sided, the marketplace podcast. If you enjoyed today's show, don't forget to subscribe. If you listen on iTunes, we'd also love for you to rate and give us a review. If you got inspired to build your own marketplace, go visit https://www.sharetribe.com. It's the fastest way to build a successful online marketplace business. Until next time.

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