Developing a growth model + marketplace growth strategy | Dan Hockenmaier (Faire, Thumbtack, Reforge)

Dan Hockenmaier is an expert on marketplace strategy and growth. He was previously the Director of Growth at Thumbtack as well as a partner at Reforge, where he co-created the monetization track. Currently, he is the Head of Strategy and Analytics at Faire. In today’s episode, Dan shares the building blocks of a growth model, important considerations when building your growth model, and how to get started. We also chat about retention best practices, the complexity of building a marketplace, the future of marketplaces, and when it makes sense to add a SaaS business to a marketplace, and vice versa. — Find the full transcript here: https://www.lennysnewsletter.com/p/developing-a-growth-model-marketplace — Where to find Dan Hockenmaier: • Twitter: https://twitter.com/danhockenmaier • LinkedIn: https://www.linkedin.com/in/dan-hock/ • Website: https://www.danhock.com/ — Where to find Lenny: • Newsletter: https://www.lennysnewsletter.com • Twitter: https://twitter.com/lennysan • LinkedIn: https://www.linkedin.com/in/lennyrachitsky/ — Thank you to our wonderful sponsors for making this episode possible: • Amplitude: https://amplitude.com/ • Flatfile: https://www.flatfile.com/lenny • Eppo: https://www.geteppo.com/ — Referenced: • Reforge: https://www.reforge.com/ • Casey Winters on Lenny’s Podcast: https://podcasts.apple.com/us/podcast/how-to-sell-your-ideas-and-rise-within-your-company • Faire: https://www.faire.com/ • Dan’s blog post on the future of marketplaces: https://www.danhock.com/posts/the-future-of-marketplaces • Careers at Faire: https://www.faire.com/careers — In this episode, we cover: (00:43) Dan’s background (04:01) What is a growth model? (07:20) The building blocks of a growth model for your own business (10:22) The value in building your own model (11:12) The importance of retention over growth (14:49) Getting started building your model (19:18) The growth model at Thumbtack (20:36) The importance of the early user experience for retention (25:02) Why is a marketplace a good business? (28:23) Health metrics for marketplaces (33:47) Supply and demand, and why you shouldn’t neglect demand (36:23) The role of ROI equations and how to use them (39:16) Why you should tread lightly when working with marketplaces (42:43) Expanding marketplaces (46:50) How marketplaces can add a SaaS offering, and why adding a marketplace to a SaaS business is trickier (49:47) When is there an opportunity to unbundle? (54:43) B2B marketplaces (56:36) What is fragmentation? (58:46) The future of marketplaces — Production and marketing by https://penname.co/. For inquiries about sponsoring the podcast, email podcast@lennyrachitsky.com. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.lennysnewsletter.com/subscribe