How to Build a Successful MarketPlace by Going Vertical

In this episode, we talk to Max Ade, the CEO, and founder of GrowthCollective.

There is an explosion in the popularity of the gig economy. As more people move towards a remote work lifestyle, this trend is going to continue.

However, it's also a very competitive market with huge companies like UpWork and Freelancer.com already very successful.

We talk to Max about what it's like to build a company in such a competitive market, and how can he compete with those companies. We cover the benefits of building a vertical marketplace, what Max feels his competitive advantage is, and what it's like to be an entrepreneur.

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Time Stamped Notes

[2:20] - Growthcollective is a freelance marketplace for marketers. It's ten months old, bootstrapped, and generates $50k a month in revenue through the platform.

[5:00] - Max spent four months in discovery mode, understanding the common problems freelancers have. He realized the primary problem they need help with is finding clients.

[6:45] - Max likes launching products in competitive markets. It means that the market has been validated and is sizeable. If you can out-execute and find ways to win on your go-to-market, you'll build a profitable business.

[8:45] - Max doesn't see the likes of Upwork.com or Freelancer.com as his competition. Those places compete on price, so many of the best freelancers avoid them. Instead, he feels his competition are agencies. With the rise of remote work, he feels more companies will hire the best freelancers for a job vs. a local agency.

[12:00] - Growthcollective is a marketplace. Max leveraged his network to get the first number of freelancers and companies onboard and using the platform.

[14:15] - Growthcollective makes money by taking a % of invoices through the platform.

[16:40] - One of the challenges marketplaces like Growthcolletive has is people leaving the platform once the introduction is made, and doing business directly with each other. Max talks about how Growthcollective overcomes that by helping companies to understand what marketing they need and who they should hire.

[20:00] - Max talks about how he retains quality throughout the marketplace, both for clients and freelancers.

[22:10] - The problem Growthcollective solves is both helping companies understand what marketers they need, and providing them with vetted marketers who can do that job.

[23:30] - Max talks to how Growthcollective can scale, and still maintain a very hands-on approach to matching companies with the right marketers.

[25:30] - There are a lot of metrics to track when growing a marketplace. The two most important for Max are the total revenue through the platform, and what's Growthcollective's cut of that. He also is looking at metrics like churn, the average length of a contract the cost per acquisition of each marketing channel.

[26:50] - Max is currently raising a seed round; he wants to use that to hire marketers to help build more pipeline for the business. He also wants to hire a product manager to optimize the web experience. Later in the year, he wants to start building out a remote engineering team.

[29:30] - Max talks about his plans to expand Growthcollective beyond marketers. He thinks a lot about things like the NoCode market, and people who are looking for experts on platforms like Zapier, HubSpot.

[32:30] - Max talks about what it's like to be an entrepreneur, and how it's a rollercoaster of ups and downs.

– Max on Twitter / LinkedIn
– Kieran on Twitter / LinkedIn / Medium
– Scott on Twitter / Linked / Medium