Marketplaces — Sell before Building?

If you’re building a marketplace with large transactions ($1k+), it usually makes sense to sell first vs build.

You can be a ‘broker’ & quickly test ideas with only a phone & Google Docs. No need to build for weeks first.

Once you’ve learned what works, it will be much easier to build.

Transcription

Hello, everyone. Today, we’re talking about marketplaces with large transactions. By large transactions, I mean over $1,000 each. For example, a marketplace for the reselling of construction equipment or the licensing of intellectual property.

If you’re building something like this ask yourself, if you actually need to build anything at all to get started. I would argue you could become a ‘broker’ so it’s easy to test your ideas with nothing more than a cellphone and Google Docs, on a pretty fast iteration cycle. No need to code for weeks.

Given that many of your assumptions about the business will unfortunately be wrong, this approach will actually save you the trouble of building it all twice. Once you’ve learned what works, you can build exactly what the customers want. Some Founders pushback on this approach because they want a demo to show off to investors. And to that I would say: investors do like demos, but they really love traction.

Written by

Pre-seed Investor. Email: ash@sterlingroad.com. B2B, US only. I work with founders for 3 months before investing. More info: http://SterlingRoad.com/process

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store