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by harmmonica
3479 days ago
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I agree with so much of what you say here (hope for the AWS strategy; the fact that this is a service business, which is what the existing brokerage business is as well of course; using data/ml to remove (massive) fat), but I'm torn about whether their end goal is actually, or even should be a marketplace in the traditional ebay/zillow/trulia sense. There are countless residential marketplaces with good reach already that as long as their pricing model works really well they can focus on supply side exclusively (i.e., buying for 98 cents on the dollar) and then using the existing marketplaces to market. They have to find buyers, of course, but that doesn't mean they need to directly source the buyer. In this model, as the old real estate adage goes, you make your money when you buy the property (that's not meant literally of course). |
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1. one co-founder is a VC who previously led a marketplace business, paypal. VCs are already conditioned to aim for marketplaces. tasting marketplace success as an operator probably only deepens this reflex. it's harder to eat ground beef when you're used to wagyu.
2. if a marketplace is possible, why not? it creates a larger moat to keep out competitors and assuming they don't abuse monopolistic power, a single marketplace can make pricing fairer (more buyers, more sellers) and more efficient (lower fees). instead of 6%, what if OD enables a world where transaction fees are 0.5% or 1%? the classic disruption playbook (hi, telsa!) is to aim for a dominant market position by starting high, then using technology to steadily reduce prices, expand use cases, and gain market share.