Introduction
After you’ve spent some time analyzing your Aha Marketplace idea, you’ll be ready to start brainstorming, defining requirements, designing, and then coding the platform. This is what we thought anyway when we started ours in 2017. In the era of AI and the golden age of marketplaces, there might be a better way, something else to consider before you embark on your maiden voyage.
You can now leverage AI to code a basic marketplace for you, or at least explain how to yourself, even for us non-technical people.
You can use no-code tools like Bubble to assemble or hire an agent.
You can use a low-code tool to start and eventually graduate to building on top of
All 3 points show you no longer need to spend hundreds of thousands or millions on building your Phase 1 Marketplace.
This will show some examples of building custom from the ground up or leveraging what’s available today.
To Qualify
Our Core Team at Marketplace Studio were the founding employees of a rent-anything marketplace in 2017. Leading Product, Design, Trust & Safety, and Ops. We spent over $11 million on building our platform, a mobile app, a desktop application, and a backend system to manage the marketplace.
We built nearly everything custom because we had the capital and advantage of first-to-market with the plan of lowering our monthly partnership payments.
This is from our Member Chat System, Live Delivery Tracking, to Search.
Now, you could build an equivalent for a few hundred thousand (at the high end), launch even faster, and be more agile.
Once necessary mention to consider, we started with the mindset of doing it manually first, automating when it becomes a headache. In other words, do things that don’t scale. Learn from them. Correct it later.
What We Built
All core functionality typically required to create a marketplace, Signup, Add Listing, Checkout, etc. We also made an Uber-like feature where people could be Drivers to ship rentals and track in real-time. Renters could request Shipping, have it automatically assigned to a driver, and provide them with navigation to and from the delivery.
We had a custom Ops Backend where we could manage every detail.
Users
Listings
Bookings
Deliveries
Platform Fee By Category
Taxes
Discount Codes
Search
Taxonomy
Notification Types, Triggers, & Content
And on and on
We built or partnered the best tools for the least expensive costs to help automate a lot of the “Behind The Scene” effort. This ultimately saved at the end of year 4 Annualized Wage Savings: $4,817,356.00.
In 2017, no suitable solutions in the market would have worked for what we built. That is the most significant benefit of going custom, the freedom.
We spent four years building out a hybrid mobile application marketplace and desktop version that mirrored functionality and our backend system, which resulted in being critical to our success in managing the marketplace.
There were a few areas we would partner with because we were fortunate enough to have the funding to invest in custom builds later to reduce our monthly payments for our partnered tools. For example, our Search & Discovery experience was a custom elastic search engine commonly used for document searching at scale. We could add “events” in the code to track what terms were searched and where; however, it was elementary compared to a specialist like Algolia. Algolia is the tool Marketplace Studio has partnered with for various reasons, mainly Cost, Implementation Time, and Reporting.
Partnering
This depends on the type of marketplace you’re looking to create, but there are platforms like our partners at Sharetribe or Nautical Commerce that you can leverage and use out-of-the-box or build on top of when you can.
Sharetribe, for example, offers a combination of no code and code in their newly released product, combining the previously separate Go & Flex products. You can launch a marketplace within a day, depending on your use case and if it requires unique tweaks or upgrades. Once you launch and prove the concept to raise money or bootstrapping, you can layer in coded workflows to improve the UX or business model.
Sharetribe allows you to manage a lot without a developer or hiring an Expert; they’ve added a lightweight CMS (Content Management System) to build and design your static pages, Landing Page, FAQ Pages, etc. You can change the wording everywhere in the platform: platform free rate, email templates, and much more!
If you need a tool for Adoption Analysis integrated, you will require a developer to integrate Mixpanel or Pendo. Sharetribe has Stripe for money in and out. Still, the fees are astronomical at scale. Marketplace Studio typically switches to Tipalti for payouts to make it more cost-effective from a business perspective and easier onboarding from Supply’s POV.
Nautical Commerce is a relatively new player in this space but has an excellent module product that can contain the massive functionality required for a B2B marketplace. Typically, you will require some changes to personalize your unique business; however, it gives you 80% of what you need to get started, which will vary depending on requirements. Nautical is more focused on the Developer experience, being lightweight and API-driven development following the best modern standards.
Nautical will handle your commerce, logistics, and financials out of the box. It is a platform juggernaut that a business can leverage to get ahead of any competition.
Our Suggestion
Take your time. We understand that it is challenging to slow down to accelerate later, but this will pay off in the long term. As the Founder(s), you must diligently brainstorm and think of what is required in three areas: Launch, Phase 2, and Business Management.
We typically discuss very high-level requirements during our conversations with Marketplace Founders, and the details are only defined during our Pre-Development phase of the partnership; however, some have flushed the marketplace functionality and business requirements to a T.
There is no winning here by investing a lot of effort upfront because, in our experience, there are many changes during development and in beta testing. The more upfront planning and research you do, the better the choice of the proposed question, Build or Partner. It will mainly revolve around your business's finances and how much you can safely invest in creating this marketplace.
Time to Market is the most significant factor when creating your marketplace, and that indicates that Partnering with a system like Sharetribe or Nautical is the most effective choice and building on top of it, like Lego.
