Inbound Growth for Two-Sided Marketplaces (No Cold Calling)

A two-sided marketplace has two empty rooms on launch day. Buyers will not come until there is something to buy, and sellers will not list until there are buyers. Every marketplace founder knows this as the chicken-and-egg problem, and a lot of them try to solve it with brute force: cold emails, cold calls, scraped lists.

It can work, briefly. It also tends to attract the least interested people on each side, burns your reputation in small industries where everyone talks, and stops the moment you stop pushing.

Inbound growth is slower to start and much more durable. You make each side come to you, because what you publish, and what the other side has already posted, is useful to them. This post is a practical plan for doing that, written for founders of marketplaces that serve small businesses.

Decide which side is harder, then seed the other

Not both sides are equally hard. Usually one side is scarce and valuable, and the other follows it. The first job is to work out which is which.

Ask three questions of each side:

• Who has more to gain from a single match? They will put in more effort to be there.
• Who is easier to find in one place? Communities, associations, directories and forums make a side cheaper to reach.
• Who can you serve well at small numbers? A handful of good listings can be enough for a buyer; a handful of buyers is rarely enough for a seller.

In most marketplaces the supply side (the people listing) is seeded first, because a buyer arriving at an empty shelf leaves and does not come back. Andrew Chen's "The Cold Start Problem" describes this as building an atomic network: the smallest group, on both sides, that can sustain itself. For a local services marketplace that might be one suburb and one trade. For a software marketplace it might be one industry.

Narrow before you grow

The most common inbound mistake is being broad too early. A marketplace "for all small businesses" has no community to join, no keyword it can win and no newsletter anyone would miss.

Pick a starting niche where:

• both sides gather in identifiable places, online or off
• the problem the marketplace solves is frequent, not annual
• you or someone on the team understands the work (the jargon, the busy season, the software they already hate)

A marketplace connecting bookkeepers with small clients might start with bookkeepers who serve tradespeople in one country. A trial marketplace for software might start with two or three industries, say transport, salons and bookkeeping, rather than every category at once.

Everything below gets easier when the niche is narrow: the posts you write, the forums you join, the phrases you rank for.

Four inbound channels and what each is good for

| Channel | Best for | What works | What backfires | |---|---|---|---| | Communities (Reddit, Facebook groups, industry forums) | Early trust in a niche | Answering questions properly, sharing what you learned, being open about who you are | Link-dropping, fake "has anyone tried..." posts | | LinkedIn | Reaching owners and founders on the supply side | Short posts from the founder about specific problems in the industry | Automated connection requests and pitch-in-the-DM | | Search (SEO) | Durable, compounding traffic from both sides | Pages that answer one real question each, in the searcher's language | Hundreds of near-identical template pages | | Newsletter | Turning one-time visitors into returning ones | A regular, useful digest: new listings, new requests, one short lesson | Irregular sends that only announce features |

A founder can realistically run two of these well at once. Choose the one closest to where your harder side already gathers, plus search, which pays off slowly and so should start early.

Make one side's activity the other side's content

The strongest inbound engine in a marketplace is using what one side does as the reason for the other side to show up.

• New listings become content for buyers: "three new tools for mobile groomers this month".
• Requests from buyers become content for sellers: "what salon owners are asking for right now".
• Completed matches become proof for both, as long as both parties agree to be mentioned.

On LetsBeta this is built into the product. Builders list software still being built; businesses apply to try it. Businesses can also post on the demand board describing software they need, and builders can see how much demand there is in each category. A category with requests in it is a reason for a builder to list; a category with open trials in it is a reason for a business to come and browse. Each side's activity is a reason for the other to come.

You do not need a demand board to use the idea. A simple "what are you looking for?" form, published as an anonymised list, can do the same job for many marketplaces.

A 12-week inbound plan

A rough sequence, adjusted to your niche. Treat the timings as a rule of thumb, not a promise of results.

| Weeks | Supply side | Demand side | Content | |---|---|---|---| | 1 to 2 | Personally invite a small number of sellers you already know or have met in the community | None yet | Write the three pages that answer your niche's most common questions | | 3 to 4 | Help each new seller make a strong listing; review every one by hand | Share the first listings in one or two communities where you already contribute | Start a fortnightly newsletter, even to a small list | | 5 to 8 | Publish what buyers are asking for, to attract more sellers | Answer questions in communities; link only when it genuinely helps | One useful post a week, each targeting a distinct search | | 9 to 12 | Add a second niche only if the first is active without your daily effort | Ask satisfied buyers what else they need | Turn the best-performing post into a series |

The rule for moving on: do not open a second niche until the first one has matches happening without you manually introducing every pair.

Keep quality high enough that word of mouth works

Inbound growth relies on people recommending you, and people only recommend a marketplace where the other side turned out to be good.

That means some unglamorous rules:

• Review listings before they go live. LetsBeta has a person review every build before it is published. One misleading listing can lose you a buyer permanently.
• Show prices plainly. Buyers trust a marketplace more when there are no surprises. Every LetsBeta listing shows the full price, the early-adopter price, how long the discount lasts and what happens after.
• Protect people from being spammed. Keeping contact details out of public listings stops your marketplace becoming a lead list. On LetsBeta, messaging opens only after a builder accepts an application, and contact details are blocked in listings and messages alike.
• Label paid placement. If sellers can pay for visibility, say so clearly on the page. LetsBeta marks every sponsored listing and category as Sponsored.

Mistakes that stall inbound growth

• Posting the same announcement in twenty groups. Moderators notice and so do members.
• Measuring sign-ups instead of matches. A thousand registered buyers with nothing to do are a cost, not an asset.
• Opening every category at launch. Empty categories tell visitors the marketplace is empty.
• Treating content as advertising. A post that only says "we exist" is not useful to anyone, and search engines and readers both treat it that way.
• Charging the harder side too early. Make the scarce side's first experience easy; earn the right to charge once it is working for them.

Where to go from here

For more on showing up usefully in communities, read How to Find Customers in Online Communities Without Being Spammy. For choosing your first niche, Beachhead Market is the natural next step.

If you are building software for small businesses and want to be on the supply side of a marketplace like this, list your beta and see what businesses in your category are asking for.