Dominant Rise of Marketplace Model in Indian Startups

Learn more about Accel’s upcoming event ‘Decoding Marketplace’ here - www.seedtoscale.com/marketpla...
In this video, we talk about how marketplace model has seen a massive adoption among Indian Startups and how Accel, a venture capital firm that invests in early and growth stage startups, has helped in it’s growth in India.
The marketplace business model is when an online store allows multiple sellers to sell their goods and services through its platform, connecting them to possible buyers.
Marketplaces come in many shapes or forms, but are often separated between two categories: horizontal or vertical.
Horizontal Marketplaces offer products across different categories on a single platform with a similar level of services, so for example customers can buy products on Flipkart ranging from groceries to mobiles to fashion to electronics, Flipkart has everything.
Vertical Marketplaces, on the other hand, focus on just one product category but they offer a lot of variety within that category, and Cars24 is a great example of this. They buy and sell used cars and also provide other services like for example car financing.
So those are the basics of the marketplace model, but now let’s actually take a look at how these businesses make money.
The first method of generating revenue from a marketplace is called the Commission Model.
This is arguably the most widespread way for a marketplace to make money. They take a commission for each successful transaction, and the reason they’re able to justify this is that they handle the payment and logistics for each sale. Examples of companies that use this model include Flipkart, Amazon, and Myntra.
Now another revenue generator is called the Subscription Model, where either buyers or sellers or both are charged a recurring fee to access the marketplace, making it more exclusive. Buyers will pay this subscription because through it, they gain access to a high-quality customer experience, and sometimes it actually allows them to save money if they’re a power user. The cost of the subscription ends up paying for itself - Netflix uses this model where its users are charged a recurring fee to gain access to its entire library of movies and web series.
And then finally we have: the Freemium Model. Here, the marketplace can be used free of charge for both buyers and sellers, and the idea is that once buyers and sellers get hooked, once they realise how valuable the platform is for them, they don’t mind paying a fee or subscription to gain access to additional power user features.
About Accel:
Accel is one of the leading venture capital firm in India, investing mainly in early and growth stage startups. They've launched an exciting community initiative called SeedToScale, where they sit down with successful Indian startup founders to find out how they went from Seed to Scale, how they went from an idea, a tiny little startup, to a massive change making business. A part of this initiative is they're upcoming event called Decoding Marketplaces which is happening on December 1st, where they'll be bringing together aspiring startup founders to learn more about the marketplace ecosystem in the country and how to navigate it.
#startup #accel #marketplace

[@whalemurugun]

Expecting more content like this. Need these contest, even after Caleb returns.

[@shaikusman536]

Awsome Caleb....Much needed content....Subscribed Seed to Scale YT......Thanks a ton Caleb & team BWM.........

[@momentsofhappiness]

Would love to see your opinion on IndiaMart and like companies.

[@nothing-pu4mk]

Editing is top notch is he one from varun mayyas cohort

[@aditeyasharma3873]

How to win the ticket? Please help!

[@AmitKumar-he3dl]

How to get invited to this event?

[@PradeepSharma-zq9ei]

But does it make money though?

[@barryobrien1890]

Too bad you did not cover ondc. It seems to fall into this topic but fits none of the models, and it's difficult to understand the driving forces or profitability model. Thanks

[@ashiq1141]

Ondc is the worst thing. And my experience at ondc is the worst. Too bad services.

[@omthakkar7801]

@@ashiq1141 please tell more. What happened exactly?

[@krishnachaitanya7435]

@@ashiq1141 it's Still in the pilot version and the bugs are normal even the UPI, Co-Win Portal had issued in the initial stage of deployment, Hopefully they'll fix up the issues like they did it successfully as always

[@Hakimshafin]

Not owning the assets that makes them money is the problem imo, look at dmart they don't outsource their assets like these modern days cash burning companies (Uber,ola,Zomato) etc. Properitary assets are a must for sustainability,what you think Caleb ?

[@brhmanmedia]

Amen to that

[@Dina_1041]

I come from Kips vid

[@RamThakur-selfgrowth]

You forgot one of the biggest marketplace INDIAMART

[@7thson47]

Indiamart is 99% scam

[@yosup125]

hello

[@mygallery4899]

😊👍 Hi

[@backstagewithmillionaires]

Hi 😊👍 -Caleb

[@zkephmnoy8877]

Marketplace model is failure model. 90% company you mentioned in video doesn't make single penny as profit.

[@Dr.Kraig_Ren]

Well, the number one company in the world started out as a Marketplace model. It's like software, easier to scale.

[@zkephmnoy8877]

@@Dr.Kraig_Ren Yeah ,in current technology seller can easily connect with buyer, for example every reliable amazon seller has own ecom site to sell product.

[@Prabhakaranraj]

Is it ? What about KZbin, App Store, Fiverr, check what all apps you have on your phone most will be marketplace some how. All social media platforms are marketplaces for content. If u see just physical product marketplaces it may seem like a failure model for now.

[@zkephmnoy8877]

@@Prabhakaranraj if you think like that any thing sold in this world through a medium is called marketplace... hospital is market place for cure, library is marketplace for knowledge , etc.

[@Prabhakaranraj]

@@zkephmnoy8877 I think here we are talking about online marketplaces. You referred marketplace model is a failure. I hoped u are referring to online marketplaces.

[@Dr.Kraig_Ren]

4:09 Look at the phone on the top right screen. Just before the image ends. There is a "wand massager"

[@anonymoushacker9094]

All these are not even making profit

[@honahi2351]

marketplace model is most unimaginative thing . its like a dalal(middlemen) not doing anything not producing anything worthwhile in the end its a bad thing.

[@---_---_---_---_---_---]

First!

[@dieter7043]

This has brightened up my day 🌞!! YT ranking services = "Promo SM"!