How marketplaces win: Liquidity, growth levers, quality, and more | Benjamin Lauzier (Lyft, Thumbtack, Reforge)

0:00 I think when you're running a marketplace, you tend to sit in your ivory tower a little bit, looking at stats and thinking like if only we could get people to do X, it'd be better for for everyone, right? I I I certainly, you know, did that in my career. I think um that's missing the point that we're humans. And I think sometimes we act in ways that are non-deterministic, uh or counterintuitive. But my take is I'm a huge believer in market forces and empowerment. So provide guardrails for what a good experience is in your marketplace. Set a clear bar for quality and provide the right coaching uh and tools for supply to be successful, and then take a step back and see where the gaps are, and invest more in hands-on tactics just to close those gaps more specifically. Today my guest is Ben Lazier. Ben was VP of Product and Growth at ThumbTeC, where he rebuilt the product team and ThumbTeX growth strategy, re-architected the revenue model, and helped 3X Thumbtack's growth within three years.

0:59 Prior to Thumbtack, Ben was at Lift for over six years, where he was employee number thirty and led product and growth for the driver's side of the business, and at one point reached one percent of US workers driving for Lyft every month. He currently spend his time advising marketplace teams and founders. Teaching a Reforge course on marketplace growth. And most recently started a healthcare company called Nura that connects you to a care advocate to help you navigate the healthcare system in the US. In our conversation, we go many lay deep on the many key elements of building and scaling a marketplace business, including what to focus on pre-product market fit, how to know which side of the marketplace to prioritize, what product market fit looks like, how to track liquidity, what causes most marketplaces to fail, and how to avoid that.

1:43 And a bunch of examples of really clever growth strategies, especially on the supply side. And some really interesting stories about how Lift was able to compete with Uber early on with one tenth of the resources. As a bonus, Ben also shares insights into how the European product market is different from the US product market and what he encourages European companies to change in order to operate more effectively and be more innovative. This episode is for anyone building or thinking about building a marketplace business. If you enjoy this podcast, don't forget to subscribe and follow it in your favorite podcasting app or YouTube.

2:15 It's the best way to avoid missing future episodes and it helps the podcast tremendously. With that I bring you Ben Lazie. Ben, thank you so much for being here. Welcome to the podcast. Thank you so much. It's so good to be here. Thanks for having me.

2:32 It's absolutely my pleasure. Okay, so you are one of the most knowledgeable and experienced product leaders in the world on Building and scaling a marketplace company. And so I wanna spend the bulk of our time talking about And essentially extracting as much wisdom out of your brain.

2:48 on how to build and scale a marketplace business so that Founders and teams that are struggling with building their marketplace company. Or just thinking about building a marketplace business can save a lot of Time a lot of

3:00 Pain. Uh, how does that sound to you? That sounds amazing. That's a high bar, but I will try to live up to your expectations. I am confident we will hit that bar. Let me start with just setting a little context. And for folks that aren't super familiar with

3:15 What is a marketplace business? They hear this term marketplace company. Uh what's the simplest way to understand what makes a company a marketplace company in a marketplace business? I mean, like you mentioned, I love marketplaces. I think uh I've been building and scaling marketplaces for, you know, I think almost fifteen years now. And I feel like they add just such a fascinating dimension to the challenge that we work on as as PMs. You know, it's this hide hidden dimension that you uncover when you work on marketplaces. And I think on paper, what makes the marketplace is pretty straightforward, right? It's two or more sides that are distinct uh you know from one another and they provide value to each other. And then you have an intermediary uh trying to facilitate that exchange of value in the middle.

3:53 That's Pretty simple sort of explanation. I think in In practice, it's always a little bit more nuanced on the fringes, right? Uh you have all those interesting dimensions, like how involved is the intermediary defines how managed the marketplace is. So something like Crixist is super hands off, unmanaged. And something like Lyft starts to be more into the semi managed where

4:13 The platform significantly shapes the transaction and this exchange of value, right? So um I think that's how I see it, but there's also all those sort of fascinating, you know, variations of marketplaces, I guess. This episode is brought to you by Epo. Epo is a next generation A B testing and feature management platform built by alums of Airbnb and Snowflake for modern growth teams. Companies like Twitch, Miro, ClickUp, and DraftKings rely on Epo to power their experiments.

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6:43 And get$1,000 in credit on their pro and enterprise plans. That's use P-A-R-A-G-O-N.com. You mentioned managed marketplaces and just how that becomes uh something marketplaces start to think about more. I wanna get back to that'cause that's a really important point. But just just to even uh clarify this point, a key part of a marketplace is that the company doesn't own the supply. Right.

7:07 That's In a sense kind of what defines their marketplace versus they're just selling stuff. Totally, yes, yes. And I think again, like You have companies that claim to be sort of

7:16 The fo managed marketplaces. I think depending on like how you want to look, uh with investors, perhaps you'll pick like one and go or the other. But um that's where you get into like, you know, sort of grey waters. Uh but yeah, like the the Mark Plus implies this concept of too independent and, you know supposedly autonomous uh parties. uh that you sort of help connect and and uh

7:38 and and provide this exchange of value for them. Awesome. Okay. So let's come back to that'cause that's a really important topic and it's something that every marketplace kind of trends towards or thinks about is just like we're gonna control the supply, we're gonna manage it, we're gonna maybe own it in the future, but let's come back to that. So

7:53 You work with a ton of marketplaces, you've built a bunch of marketplaces. What do you find? is the biggest struggle to building A successful marketplace business, the most common.

8:03 problem people run into. I think there's two types of challenges, I guess. There's uh You know, when you're talking about creating a marketplace and then there's when you're talking about scaling a marketplace. For creating a marketplace, I see many founders that are Pre-park market fit, super eager to nerd out on marketplace dynamics. They're super excited to launch a marketplace. Uh, we all are. Uh, and they want to talk about supply and demand. They wanna look at all kinds of ratios, they wanna they show me economic papers uh and ask like how could we apply this principle to my company.

8:35 Uh, and here my advice is generally always If you don't have product market fit, and if you don't have A good enough growth strategy for at least one side of your marketplace. Just forget about all this marketless stuff, right? Focus on this core exchange of value. Go deep with one side of the marketplace and see if you can rely on some crutch, some hack.

8:54 For the other side for the time being, right? And you see companies like um You know, Airbnb and ThemTech doing this with Craigsis pretty early on to jump start their growth as just countless examples, but You know, don't get distracted by, you know, this shiny and and cool sort of intellectually challenging idea of working in a marketplace and nail the basics of your product market fit, um, at first. So just to spend a little more time there to make this even more real, so You're saying that

9:18 Pre product market fit before you Find that anyone really Wants what you're building. Focus on figuring out a way to grow. one side of the marketplace.

9:28 So maybe just two quick follow up questions. How do you know which site to focus on initially? And can you give an example, I think ThumbTech may be a good example of this of how they did that. W which third to focus on is like There's Different approaches to this, but generally people will pick the hardest side.

9:45 And so if you know uh for I'll Take the example of FemTok because we're gonna talk about it. So ThemTyke is a home services marketplace to help you find plumbers, electricians. And um the Sort of

9:57 The the The harder side there was uh uh was a demand. Like th there is there's supply you can like sort of look for you can open the yellow pages, you can like find plumbers somewhere, but the hardest question was

10:10 Can we go out there and can we find people to uh you know to who want to uh you know do something in their house, who have like projects that need to be done, right? What is the core growth strategy for us to to acquire those people to find them? And what kind of retention can we create? Can we create a delightful experience for them, uh, you know, to come back to our platform and want us to take care of their home for them. Pick the hardest side is sort of my advice. Um And then how some companies sort of do this, again like I think there's

10:39 A lot of different ways to do this, but a common advice is find a way to jump start one side, right? Find a way to like hack one side. Uh Play one player mode is uh what is also also called sometimes. But you know, try to find a way to tap into existing channels that have one uh side of your marketplace already latent.

10:59 Um, and so uh again you have countless businesses that have been built off of Craigslist, uh, I think Them Tac was partially one of them. Uh and the idea was like hey, like we can find, you know, all those great pros on TemTech, we can when we have someone who wants a job. Uh oh you want your kitchen remodeled, we can like you know, behind the scenes going post that job on Craigslist. And then we'll bring on like you know all the contractors who are like browsing Craigsist looking for a job, right? We'll bring them to our platform. That's an example of like how, you know, that way you you worry around the core, you worry about the core value proposition of can we get people to come back to a platform? Can we create this

11:35 delightful exchange of value. Are people trusting us? Do we have the right checks in place to make sure that you are hiring the right person, uh what will make you come back. And once that's done, then you can focus around how do I build a fly well on the supply side and how do I manage and how do I make sure I have enough plumbers for you know per market or something like that. When you say the uh Buying the hard side.

11:55 How do you find that any advice you can give Founders and teams. In general I would say Okay. In two D V, like the teams know, like especially the teams are like in the weeds.

12:04 Ah, they know they know like, Well, yeah, we can get no X. But what we really struggle with is getting students to look at this, right? That's sort of your sign. And I think um sometimes it takes, you know, someone else to like make you think about it to reflect like actually yes, you're right. Like this site is is obvious. We know how to get it. We just don't have the right supply for it and we don't know how where to find the supply. Boom. That's that's the site that you should be focused on. that then you know find a way to like outsource your demand, subsidize it, find some other way, and like focus on on this site that you have no idea how to grow. Like that's that you should have a reliable growth strategy for for this site.

12:39 In my experience it's almost always the supply side is what you need to work on because once you have awesome supply people are gonna be really excited to Tap it like Uber Drivers, R B homes. Uh Professionals on thumbtack. Is that is that your experience too?

12:54 Yes, I would say Um, supply is the hardest side, maybe like eighty to ninety percent of the time. Yeah, I totally agree. Yeah. I was trying to think of like counterexamples, but I can think of one. I just know that there are there's one I know which is a Rover. based on research I did ba because it turned out it was really easy to find people who wanna walk dogs and watch dogs for fifty bucks an hour or whatever. It was like a very easy value prop.

13:16 And so that they had a wait list. They had just like so many people. Also Task Rabbit is the one I know about where That so many people wanting to be Taskers, whatever they call them right. I was gonna mention Tasker B as well, I heard that as well, yeah. Okay. And then uh you talked about There's a core part of figure out how to grow that part, how to grow the hard part.

13:33 Generally the supply side. You shared a couple of examples. Are there any more like clever things you recall that you might be able to share of just ways people grew. supply early on that could inspire people that are trying to figure this out right now. Yeah, I think there's a couple of, you know, uh

13:50 Like common like tactics outs like pretty early on that um I think companies like rely on so we've talked about jump starting one side of the marketplace uh with you know like it may be with uh Yeah, FemTAC and Lift also leverage jump boards. Um You have um

14:06 Uh also a lot of companies like building like value added services like pretty early on as like a core way of retaining supply, like pretty early on. Like let's build You know. a really compelling basket of value for the supply. And this is gonna be like the thing that like appeals everyone. Uh so uh you know like uh Open Table did this like really well with like all the restroom services. uh other things that I've seen people use like really well early on or uh like You know, converting your s your supply into demand or demand into like supply, uh pretty early on. So

14:35 Liv we tried that. Uh it actually didn't work at Lyft, uh, but I know uh other marketplaces have been like uh pretty successful with like, you know, w with with that. Um just to make sure people understand that one. It's a really interesting one is In the left example would be convincing drivers to become riders, convincing riders to become drivers, and mostly the latter. Convincing riders to become drivers.

14:55 Yeah, exactly. In our case that lived early on. we were you know, we we had a wait list on the demand side because we just couldn't uh you know onboard enough supply. And so we had this idea of like having a pop up instead of saying like no drivers available, it would be like hey So all the drivers are taken, do you want like People are making fifty bucks an hour right now. Do you want to like hop on your car and and drive? Uh and we had like some conversions, but it felt a little distracting to the overall experience and wasn't like a huge driver of uh of supply. But I know that for Uber uh it actually was. Um I think they had like a a non like a relatively meaningful uh amount of supply coming from the game. Wow, how does that make you feel that Uber figure out a better way to approach this and

15:31 Made it work. That doesn't feel like and it's a different audience. You would think that the lift sort of passenger and driver is sort of a more uh you know likely to like flip back and forth between the two. Um Um I don't know. I don't know. I um

15:46 Some cam and Uber outdid you guys. Oh no. Yes. On a couple of other things. And we addressed them on a few other things so I'll talk about it. That's right. So essentially what we've been spending some time on here is just When you're starting a marketplace.

16:01 Figure out which side. You need to Drive because That's what we'll unlock this opportunity. There's a hard thing that nobody's ever done before.

16:10 And most of the time it's build a bunch of supply that nobody has done before. And there's all these tactics for how to do that. And all of this is As you coming back to kind of the main question I asked, we've gone on this awesome tangent. is uh pre product market fit before

16:25 You even know this is a thing, spend time. Most of the time building supply to see if demand customers actually want this thing. Right. Exactly.

16:34 And then I think there's A different set of challenges. I think another like the other pitfall that I see Um, is uh so Pre product market fit. People tend to be distracted by those markupless dynamics like we talked about, instead of doing what we just talked about.

16:48 For companies that have some sort of scale and product market fit. To me that the place where I see people getting tripped up most often is The concept of marketplace liquidity or how to manage the health of a marketplace. And to me

17:02 Liquidity is how marketplaces win, right? It's it's this measure of your ability to match buyers and sellers efficiently, right? It's it's how quickly and efficiently people can find what they're looking for on your platform. So you can picture A Venn diagram. Uh one circle is this is what supply wants to sell. And another circle is this is what D Men wants to buy and your liquidity uh is you know the overlap between those two circles, right?

17:26 So for let's take the example of Lyfter Uber, because we talked about them You know, it might be For all the people who open the app with the intention to book a ride, how many of those actually turn into a ride? Right. And

17:39 This metric, um Liquid G, it's it's a direct multiplier on the efficiency of your marketplace. It's literally at the center of your vision. It's what you exist as a marketplace, it's to connect the two, right? And it's it's also the ultimate engagement loop. The more supply you have The more choice people have, the better the service is, the more likely it is that it turns into a transaction, and the more likely it is that they come back. Uh, and so it's really this incredible sort of circle and What I see is people

18:05 sort of you know, uh missing how critical this component is in the marketplace. uh struggle to define it for the business. And uh most importantly, you struggle to build like an actionable playbook against it. Like, okay, like how do I manage this? Okay, it's important, but like what do I do about it, basically. Is there a metric you recommend people specifically look at to understand liquidity?

18:26 I think the metric that I like uh the most is sort of a uh a predictor of liquidity. So your liquidity might be like uh it's typically a measure of you know demand utilization, right? Like it might be um looking for you know, like something on there, maybe like how many of those searches with intent actually turn into a transaction, right? So it's your field rate of your intentful demand, typically. And that that's really indicative of the net output of your marketplace. Um and so that gives you a a sense of like the the health of your marketplace. But it can be influenced by a whole bunch of different factors, right? So if you think about You know, for

19:01 Uh for ThemTac, it can be influenced by if there's a snowstorm out there, if like the competition is like bidding, if there's a whole bunch of you know exogenous factors that come into play. And the metric that I think is slightly more actionable, um, is a little harder to define, but so much more you know, helpful in my opinion. It's what I call like a market health metric. And this is basically think of your proxy that is the best predictor of your liquidity. So I'll use the example of lift. You know, you have your liquidity is, you know, your demand utilization, it's uh, you know, how many apple buttons turn into a ride.

19:34 And what predicts this, right? Like what will predict you deciding to book a ride. Uh for Lyft uh and for Uber it was uh ETAs. Uh so we knew that if we had uh if the closest driver was at least three minutes away from from you or closer. then you we had hit a ceiling. You were more than like X percent likely to, you know, to convert and book a ride. If it's more than two minutes, if it's five, then maybe you check out Uber, maybe you walk, maybe you take the bus. If it's two minutes, it doesn't make a big enough difference. You're just gonna book the ride anyway.

20:06 Um, so find this sort of like threshold, find this sort of predictor that tends to plateau that correlates strongly with retention, but with also like sort of the transaction happening. And that's the metric that you can predict. That's a metric that's so much more actionable for teams to work against. If you're a supply team now you can think of okay. I'm adding a hundred supplies into the platform.

20:26 I wanna know what, you know, uh, you know, if it's actually reducing ETAs in this case, or like I can look at correlations like this uh and uh, you know, sort of uh uh limiting some of the effect of those exhaust factors that that I mentioned. Awesome. So essentially Watch uh fill rate. Is the term that used that a lot of people love. Which is just like people with intent converting. So the Airbnb example is exactly the way we did Airbnb is

20:50 Uh we we looked at people that are searching with dates. as intentful. Users and then how many of them convert to booking. Yeah, so that's basically what you're trying to get to. And your point here is that's kind of the output metric. That's like where you What you want to move.

21:05 But in order to move it, there's something that is the biggest lever to moving. Phil Right and in your experience and I've seen this exact same thing. It's usually amount of supply. You have enough good supply. And so in the case of lift is do you have enough cars?

21:19 Clumbers. Mm-hmm. And that's usually where you can actually impact full rate. Sweet. Yeah, exactly. And that becomes the goal of the team, that becomes the focus of the company, basically drive that up in

21:31 All the little markets you're in, all the categories you're in. Exactly. Yeah, completely. Awesome. You mentioned this idea of product market fit. And the things change pre product market fit, post

21:42 Pro product market fit. Uh Class question. I'm curious if you have any insights here. Just like what is tells you that you've climb that hill of product market fit that you might have product market fit or you definitely have product market fit in a marketplace.

21:55 It's hard because to me. Uh the two are almost independent. Maybe this is a a hot take, but I feel like product market fit is independent of your marketplace dynamics. You might have like you know, a great product and it provides amazing value to both sides. But you have yet to crack the you know the the fly wheel on the supply side for how to bring those people. You don't have the right your product channel fit, for example. And so it this will have a massive impact on the dynamics of your marketplace.

22:25 And so to me my answer would tend to be uh you know like pretty like classical. It would be like, you know, measure your product market fit the way you would for a normal company. So like yep. You know. Unlike the uh it's a bit of a an art more than science, but I like the the classic, you know, like if we were to take this product away, you know, like uh what percentage of users uh you know would be like

22:46 significantly uh you know disappointed or have no other solution, right? So questions like this, I think go to the heart of how valuable is your solution to users. And you can do this on the supply side and the demon side. Then you hear more advice. My advice is typically like To consider that you have Two product market fits, essentially. You want to make sure that you have like a compelling enough value proposition on both sides of the marketplace. And very often at the beginning, you find product market fit on the demand side, but you realize like it's not compelling enough uh for your suppliers because your margins are too high or something like that. Uh so realizing that you have like both those things, but I think you can measure them in a way that's like relatively traditional.

23:23 Um and that's independent of marketplace sort of dynamics. I love that. We actually just had Sean Alice on the podcast talking about that exact surveyed uh the Sean Ellis test of asking people how disappointed would you be if they left? If the product didn't exist. And uh I just love that you keep coming back to this point that I hundred percent agree with that

23:42 Most of the challenges you have with a marketplace business are Like ninety percent are the same challenges you'll have with a non marketplace business. And people overfocus on Oh, I need to think of this like a marketplace and all the marketplace science behind all this stuff. And really it's

23:59 All the same stuff every founder's dealing with. Product market did except you have two sides of it. uh growth strategy, but you have two sides of it. So I love that you keep going back to that. Something that I definitely want to touch on is

24:13 When people are thinking about starting a marketplace company What are signals that a marketplace is a good model for The idea. Because I think a lot of people come into it and be like, I want to build a marketplace. Oh, I'm gonna connect these two sides, gonna be great. There's no there's no marketplace in this business in this vertical

24:32 What are signs that marketplace Dynamic in a And a business model is right for an idea versus no, it's not. No one ever say like, Oh, I'm gonna build Airbnb for X, right? It's not something that people say. Uh

24:46 I think um The sort of the signs that that come to mind or one high fragmentation. I think you want this long tail of buyers and sellers without a handful of big players controlling the market, because this is where you can provide value by doing this job of aggregation, right? I think you also want a relatively uniform uh set of needs. Uh that means that it can be like your supply can be commoditized to some extent. This is what's so tricky, by the way, about um you know services, service marketplaces like FemTech.

25:17 Because unlike eBay where sellers, you know, they just want to sell very clear and distinct inventory, on ThemTech, you have electricians who only want certain types of jobs. But they only want it if they're available that day. And they might take a job and cancel it because something better comes up. Uh and so this makes for like a very fuzzy definition of supply. And you have very s like You know. different set of needs. Like one electrician

25:42 Wants something, the other one has a very different perception of the same unit of demand, right? And I that makes it very, very difficult. So it's it's feasible, but I would say. That is not a compelling attribute for uh building a marketplace, so a relatively ye form sort of set of needs. And the last one I'd mention is um A high enough barrier. uh in the matchmaking or the creation. Um

26:05 I think how hard it is for people to find each other today, uh, and how much effort do they have to put in to vet each other. Um I think is another great sign. If it the higher it is, like the bigger the opportunity, right? Because he means like you come in, implement the right processes. to simplify this sort of like this this exchange of value.

26:24 Awesome. I'd love to know if there's any examples you can think of of bad marketplace ideas that people have tried. But if I'll summarize the three points you just made, which I love. So these are signs that This is a great opportunity for marketplace business.

26:37 that there there's a lot of fragmentation on both sides. There's not just like A small number of companies or customers on If there are, why do they need you? They'll just find.

26:49 Like there's five airlines or whatever, you know, you don't need like A marketplace to Match with an airline. Uh Then two is there's uniform needs. The needs are basically consistent. Like I just want to stay in a home.

27:01 I want a car to take me somewhere. I want a plumber. And then uh there's a barrier, there's complexity to the matchmaking. And Helping someone. Book the thing.

27:10 work with them like finding a car, I imagine, is like I'm not gonna just flag down a car. Right, there's challenge there. I'm not gonna just go and ask them why can I stay in your home? There's challenges there. Exactly. Awesome. Are there any examples of companies you've seen that are just like that will That will never work as a marketplace. Or here's like a funny example of a marketplace that tried to be a marketplace and it's not

27:29 I don't have a a great example of that, but I can give you s like a uh tangentially related example of a marketplace that um I don't wanna throw anyone under the bus. I I respect the the sort of the the company and the effort. Um but Sidecar uh at the time was another Redshank company uh competing with uh Left and

27:49 And um Uh There's a I'm sure a whole bunch of uh sort of lessons there. Uh they ended up Um

27:56 Uh Sort of. Closing. But I think one real interesting direction that they took pretty early on to differentiate themselves was, in my mind, perhaps very naively, uh a mistake. They decide to give complete control um to the user, uh where

28:12 As a user, you had a whole bunch of filters you could decide like I want a car that's you know, at least like twenty fifteen or newer, I want a driver that's at least like, you know, this or newer. And so I think the theory was, you know, uh sort of reasonable on paper. It was like, hey, let's give people like more control over it. You have those other players out there, you have Lyft and Uber, and people uh, you know I feel sort of forced in this like standardized experience. We're gonna compete by giving you the choice. You get to decide the experience that you uh want.

28:42 I think in reality it just fragments your marketplace like even further, right? And you have this like hyper fragmentation uh your marketplace, uh, and I think it hurt their, you know, their their their essay is like quite drastically. If you think about ETA, When you ask explicitly, you're like, Yeah, sure, I want a new car, and you like slide it to like twenty twenty, not realizing like you just lost like ten minutes because now like you know, we had a great driver, but it they have a Honda Civic from twenty eighteen and It's yeah, not the special that you wanted. So I think uh uh you know. People who build marketplaces tend to want to give a lot of control to their users because this is what users uh want or this is what comes up oftentimes in user feedback, like oh, we have those two distinct group of users.

29:22 Those ones they really want new cars. Those ones they don't want new cars, right? And so naturally you have a product team that builds the tuggle to get into new cars. Uh And I think the mistake is that you uh, you know, uh unknowingly fragment your supply in a way that has a much more meaningful impact on the health of your marketplace than than you suspect. I think this is another awesome example of Uh

29:45 This Like don't overlisten to users and do what you think is gonna be best for the business. And this is not even a marketplace. uh lesson. It's just generally you don't want to give users more options than they will need to be successful and happy. And

30:01 Like I think Sidecar did that because they were trying to like differentiate from Lift and Uver. They're like, what can we do differently? And they're like, Oh, let's give people all these options. I think they even let uh drivers choose the price that they're offering. The right at? Which made it extra complicated. They're like, Oh my god, all these cars at different prices. But I you know, I respect their attempt'cause they were just the third wheel. No pun intended.

30:20 It's it's also like Ironically, it's um almost the the opposite advice that I usually give to companies who struggle uh with um you know, market health. It's you know, if you have like different verticals like try if possible to like open up your supply walls. Like your user is telling you like X, but

30:37 try to give them like something that is tangential to what you think they want because odds are that they uh are actually fine with it. There's this amazing example, um From ThemTyke. It's the the the smoke machine example. Uh so the Thumbtake uh now they s they specialise a little bit more in home services, but Um, a few years ago they were also doing a lot of events. So you had DJs, you had

30:58 Like photographers, uh And a lot of people were piring for uh wedding DJ on the platform. And one of the checkboxes was A smoke machine. And it turns out a lot of people are checking this. You're like Yeah, hell yeah, I want a smoke machine at my wedding.

31:14 And unknowingly to them, obviously, like only five percent of our DJs had a smoke machine. And so you would carve out like ninety five percent of our supply. And if when we talked to users, uh, they were like, I don't know, I don't care that much about the smoke machine, I didn't realize that like this was automatically going to like remove half of the supply. And so uh you know. work on ways so I can make this sort of checkbox affect the ranking, but not the actual filtering. Uh is a great example of uh How you can listen to your users.

31:41 uh and you know tweak the experience but you know uh Simplify their cognitive uh, you know, load by knowing like hey We know you prefer a smoke machine, but we're intelligent enough to know like y it's probably not a deal breaker for you. I love that example.

31:56 The other thing that I think is important to talk about briefly is when you're thinking about building a marketplace, a lot of times they fail because The business model just doesn't work. I think about a company like Cherry that tried to do Uber for Car washes.

32:11 And in theory, there's like a smart idea of I'm gonna just do on demand car wash. The problem is no one's gonna pay what it costs to do that to the like a car wash person shows up and washes your car. Yeah. I think cleaning is another example. There's also just like another one that comes to mind. Oh, exactly. Where it's just like Like someone help come does stuff for you. Something, yeah. Yeah.

32:34 And so I guess is there anything you want to add there just like This is another reason your marketplace might fail. Maybe just let me expand on this question. Just what are the most reason what are the most common reasons marketplaces fail, in your experience? And And I think it's important to say most marketplace ideas fail, just like most startup ideas fail. The most ideas period fail, thank you. Most ideas period fail. Same coming back to most of the things you're gonna struggle with are the same things that every company struggles with outside of marketplace. So let me just ask, is

33:00 Maybe specifically within marketplaces or even probably why are the What are the biggest reasons that marketplaces fail? I think Uh three things come to mind. One is this concept of liquidity that we've talked about, right? So you need to kick off this flywheel, uh, you need to build enough of that sort of density within your marketplace. And depending on a business, it can take a lot of time or money, and without the right sort of diagnostic framework, you can end up running out of both.

33:26 And so it's like that's the theme one. Um and I I felt this at Lift and I've seen this at other companies, this like rush like wow, we we have to get to this point, otherwise like we know it's kind of a losing battle until we have enough density for both sides to have a good enough experience. The other one that I see is um ignoring one side. Um Uh so we talked about like, you know, doing that when you're sort of early on.

33:49 But I see, you know, a lot of uh larger companies operating for too long as one sided businesses. Uh you know Many large You don't. marketplaces only thinking about their demand site funnels. So they run ads, they get clicks, they turn those clicks into dollars.

34:05 And they try to get it enough supply so that intuitively the experience is good enough for users. And uh my advice is if you're doing this, you're missing out on half of your business. Um and The trick is marketplaces are very laggy, so Once your network effects start to die down, it turns into this moment of panic of Oh shoot, we forgot about

34:24 you know, half of our users. We forgot that sellers are people too, and they're all leaving. And now we need to completely transform, you know, our product uh to to save the ship and to create a compelling value proposition on their side. So That's the other thing that I see is businesses realizing that they are marketplaces with like true marketplace needs like too late in the game. Um And the last one is uh quality.

34:47 I think we talked a little bit about the quality before, but It doesn't mean that you always need to have the best quality in your marketplace. But Being a marketplace implies a level of curation. Right. You need to be intentional about the quality that you aim to provide.

35:02 Um, and I think a lot of companies uh, you know, don't have necessarily that inten intentionality and you have this constant push of you know, supply, if only we'd lower our bar a little bit, uh you know, we could get like more supply, right? And so until you end up we've all experienced this at some point, you found like some e commerce website, you look for something, and there's also like, Oh my God, this looks super shitty because all the sellers look don't look that great, right? Uh, that's a quality problem, right? And so you need to be intentional about your quality. And I think that's another area where my companies fail. This episode is brought to you by Vanta. When it comes to ensuring your company has top notch security practices.

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36:18 That's V A N T A dot com slash Lenny. Kind of as a segue. From that idea of quality. I wanna talk about managed marketplaces with managed supply. So I think it

36:30 The reason quality is so Such an issue for marketplaces is Because you do not own the supply and control the supply Your marketplace, you're not just selling something. quality is innately gonna be a challenge. Air B doesn't own homes, Uber doesn't control

36:45 Employed drivers. They can't even legally tell them exactly what to do'cause they're contractors. So quality's always this ongoing challenge with marketplaces. push towards making it more of a managed marketplace. We like give people a lot more instruction. Maybe they sort of own some of the supply. Maybe they

37:04 invest a lot in training, all that kind of stuff. And like in a perfect world Not an and like an idealized world, quality will be best if you own it. But then you're no longer marketplace, your business model sucks. So I guess just any thought on marketplaces that are considering becoming more managed.

37:21 Any advice on when it makes sense to move towards that spectrum and how far To go. I think when you're running a marketplace, you tend to sit in your ivory tower a little bit, looking at stats and thinking like if only we could get people to do X, it'd be better for for everyone, right? I I suddenly

37:37 You know, did that uh In my career. I think um that's missing the point that We're humans. And I think sometimes we act in ways that are non deterministic, uh or counterintuitive. Um

37:50 Uh I'll mention another thing like example, but like would originally sell leads to pros like Plumbers and electricians. And of those leads, obviously only a fraction would turn into actual jobs and revenue for those pros. So We also saw that those pros were

38:04 Always great at converting leads into jobs. And so naturally we thought that we could provide a more consistent experience for customers and for pros by improving their ROI and selling bookings, right, uh directly to those pros. It's a common sort of marketplace move, going from, you know, some version of lead to a direct booking. Uh and did it look great. We knew we're gonna increase improve their ROI by you know something like twenty percent, maybe. And we launched this and pros hated it. Uh they hated it because They actually subconsciously like they like the spill of the sale, right? They love this contact with customer.

38:36 And they sometimes like completely overestimated their ability to close a customer. They were like I you took all those those phone calls, they kept me busy. I felt like I was like hustling, I was like about to close this customer. Uh, and so no matter what the data says, if like oh we increase the earnings by twenty percent, like the the person don't feel this way and it's the right to, you know. However they want. And We saw the same thing at Lift when trying to, you know, make drive earnings less volatile. We had to like fight a lot of that perception and a lot of that peak in effect. So my call out here is

39:06 Any attempt at control can be really tricky and backfire in ways that are unpredictable. Uh, you also touched on sort of employment classification, right? In the US when you talk about controlling supply, like all the lawyers are like No, no, no. That's not something that we do. Uh, because you know, if you control your supply, then uh there you know can be legally classified as employees and be entitled to a whole bunch of benefits. So

39:30 My take on this in general is I'm a huge believer in it it really depends on the type of company, I should say, obviously. Um But my take is I'm a huge believer in market forces and empowerment. So Provide guardrails for what a good experience is in your marketplace, set a clear bar for quality

39:48 And provide the right coaching uh and tools for supply to be successful. And then take a step back and see where the gaps. and invest more in hands on tactics, uh, you know, just to close those gap more specifically. Right. So lots of like coaching tools that left Uber did it like most sort of uh marketplaces like provide some sort of coaching. You have like a review system, perhaps you have like stars for your, you know, sellers, um, you know, for sellers who fall below the threshold, then like coach them, provide them the right tools, the right guidance, what is the standard that you have on your marketplace and help them

40:22 You know, meet that bar. And uh for people who like fall in you know For the gap that you have, then that's when you you invest in like sort of more hands-on, uh, you know, sort of uh Tools. And this is a great this is one of the things that we did at Lyft also with the the rental company that we spent up. I'm happy to tell you more about that. That's interesting.

40:40 I'd love to hear about that. Before we hear that, is there any Marketplace that has been very good at Up leveling quality. Without becoming

40:50 Managed. That did this really well that you can think of. Yeah. There's a Talent marketplace called Top Tow. Um

40:58 and they are specialized in uh in this they have a really high bar for for quality. Uh they claim to only have like sort of the Top one percent, top two percent, I believe, uh, you know, of of talent out there. Uh and uh they have uh really amazing select set of of of Uh of checks and processes. Uh there's uh this um

41:20 sort of funny story uh from from them, but apparently they're There's they advertise something like maybe like a three percent uh you know, sort of uh uh pass rate uh for their talent. So they only like on board like three percent of the people who apply. And allegedly their uh actual pass rate is even lower than that. But they thought that if they actually advertise the actual number, it would sound fake. Uh, and so they're actually like they're actually gonna say three percent because like one percent would sound like

41:47 too ridiculous and it would discredit sort of like uh their uh their town. So they're one company that does a tremendous amount of work for uh you know, vetting quality early on with a ton of uh you know like different checks, but also maintaining that quality so throughout with the right coaching tools with um you know education and things like that. That's a really good example. And so basically they just vet and only approve

42:11 high quality supply in their case. It's mostly engineers, right, I think on top tail. Correct, yes. It's most engineers' designers, I think. Which uh you can only do if you have so much supply that has so much interest in becoming part of your platform. But that's a really cool example. Basically it's just like only allowed really high quality supply. Let's hear this rental car story. So this is uh Lift trying to do rental cars, right? Correct, yes, yes.

42:33 Yeah, so this is Um Little bit of context. I uh was leading The drivers had a product lift and General Motors had investe half a billion dollars in our last round of funding. And this is Christmas Eve, I always remember uh I got a call from uh lift CEO uh and General Motors CTO.

42:52 And we decided to build a rental company, uh, essentially. And the the reason for it was really fascinating. Uh GM had all those vehicles that were coming off of lease and uh that they were forced to sell at auctions. Uh they didn't really know what to do with. Um And from our perspective, we had this massive supply gap. We've talked about this before, but we had this huge supply crunch, we, you know, were growing super fast and couldn't hire drivers fast enough, couldn't onboard drivers fast enough. Um, and when we looked at the market, we realized that fifty percent of the job seekers and welfare recipients uh don't in the US don't have a car. Right. So that was like that was our supply gap. This was

43:28 a huge pool of people that we just couldn't tap into because they didn't have a car. And so by renting cars, we could essentially manufacture our own supply, right? We could Dow this up and down. We could be very surgical about like how many vehicles do we bring in, which markets do we bring this in, at what price, right? We could even of uh you know offer to pay for the car if they drove thirty hours a week um and completely transform the lives of those people, right? Now we allow them to have true mobility. They can go buy groceries, they can go take the kids on vacation. Uh so

43:58 a huge win win for for everybody. uh you know, with with something like this. And Um, I think in in a few months we had built you know rental company from the ground up, and within 18 months, I think we were like the fourth largest rental fleet in the US. Uh And um but all this sort of stemmed from like this gap that that we saw from like okay, like it's it's not about like controlling like the drivers in general. It's about like okay, we wanna be Surgical wanna control like the quality of the cars on the platform. So we talked about that. That's a great example in the markets where

44:27 We thought the vehicles of quality was too low. We knew we could onboard like more rental vehicles, uh, you know, that were like more recent, uh to like raise the average sort of like uh you know age of a vehicle on the platform. So it gave us more control, uh, you know, by You know, in a much more surgical way, I guess. So it's not that you are launching a rental car service. The idea was add supply and give drivers a car so that they can become drivers.

44:53 Yeah. uh we uh had vehicles that uh drivers could uh rent uh from from lifts. And uh to drive uh on the platform. And also to drive for their personal needs, essentially. But but yeah. Got it. Okay. And then uh

45:12 Did this actually Work and have impact. Was this a good idea? Yeah. Okay. Yeah, yeah. It had uh had Tremendous impact, like I mentioned, I think we we scale this uh sort of exponentially to become, I think, uh, again, like the fourth largest rental fleet in the US. Uh

45:26 Because it was uh you know, it w it was so effective for us, both because We had the right amount of control, but also Um, those drivers were incredibly loyal to us. Uh, we had a whole bunch of other incentives uh that we could do. We could offer to pay for the car. Um, but only if you don't drive for the competition for Uber for Uber, uh, and only if you drive at least like thirty hours a week. Uh so this again like provided us with uh, you know, again, like much greater retention, much higher like engagement, uh, and uh was a real incentive for for us, but also for for the drivers. Awesome. And

46:00 Maybe the reason that's most interesting is this is along the spectrum of a managed marketplace. It moves closer to Like you guys sort of like are paying and covering costs of cars. It makes it less just like this simple uh highly efficient marketplace.

46:15 Exactly. Yeah. It's the Markless version of You know, maybe like your like black car fleet owner has like their fleet of vehicle and they have like people. So it this was like the the marketplace version of of doing that. And it's also just a differentiator because Jim and you guys were close and so you had this lever that other that say that Uber didn't have.

46:34 Amazing. Another uh area that I know you spend time on that I think is really interesting and I think could be helpful to people here is the mentorship program. And kind of the ambassador program that you had that lift? And how that helped you scale much more quickly than other folks were able to can you share that story?

46:52 Pretty early on at left. Uh, this was twenty fourteen, twenty fifteen, maybe, um Uber was basically like thirty X or size. Uh, they had thirty times more revenue, more people, more liquidity, like everything you can think of, right? They were growing like crazy. And we had a bit of this existential moment, as you can imagine, where we were wondering how we're supposed to compete with that, right? Uh and we had to be like super clever. Everything that you did at the company

47:17 had to be ten times more efficient, like per person. than the competition just to survive. Like that was that was the bar, just not to die. And uh put a lot of pressure on us, but uh we basically found kind of a clever way of onboarding driver uh drivers at a fraction uh of the the cost and resources. Um

47:35 So let me give you a little bit of context on Forward. So at the time the last step to get onboarded as a driver was after your background check and your driving record check came back, um you had to do a visual inspection of your car. A quick test drive, some light training, and we would check your documents. We would check that like you are the person with a driver's license and all those things.

47:57 And Uber at the time would launch a team on the ground. They would go and open an office and they would have DMV style group onboarding sessions and car inspections. And we did this as well in our first sort of like three to four markets, but you can imagine the the overhead, right, and the lead time. You had to go and you had to find office space, sign a lease, hire employees, right? Like huge, huge lead time. And We thought about it in at the time a huge competitive differentiator for us was our brand. As a passenger or as a driver

48:26 Why would you use a platform uh with lower liquidity? As a driver you had lower earnings, guaranteed. As a passenger you had like with longer wait times. Why would you use a service like that? Um You do because of the brand. Right? Because of its values.

48:39 It's how it makes you feel. And and so we had, you know, the pink mustaches at the time. We had like this like very sort of like strong brand identity. I think a lot of that has been lost now, but We also had this amazing community of drivers who were fierce advocates for the brand. And so what we did is leveraging this community and building uh essentially a self onboarding supply engine where we would pay our best drivers uh thirty five dollars per mentor session. And uh mentor session was essentially replacing this onboarding flow. So it was basically another driver looking at your vehicle.

49:12 uh they check all your documents, take photos of your driver's license and all that stuff and take you on the short Right along. And the benefits of this were absolutely mind blowing and Uh yeah. Kind of unexpected for us on on all sides.

49:25 First the the mentors were our very best drivers and they were evangelists for the brand, right? So What they did was they would share like personal tips on when and where to drive, right? Oftentimes they'd share the contact info. And This created some tremendous leverage and social proof for those new drivers who were on the fence about taking strangers into the car. It's actually quite funny because with the brightest minds in the company, like writing the best marketing email and copy, like, hey, like drive on lit on you know, hop on the car and drive this Saturday.

49:54 And you had all those drivers, like all those mentors like don't listen to the those Liv guys. Like here's what you should do. Like go uh you know, on Tuesday at two PM Text me. I'll tell you where the good spot is, uh, and this is like how you're gonna get right. This is how you're gonna get rich and make a lot of money, right? And this reconditioned level was just so much more powerful than anything we could be telling you, right?

50:13 Um And so very, very sort of like efficient activation lever for the new drivers. For us also a very, you know, like Incredibly. Right, we could fly a small team uh to rigorously vet and onboard maybe like 10, 20 top drivers.

50:28 And then they'd fly to a different market and we would let the rest of our drivers be onboarded by those mentors. And even for those mentors for those like top drivers, it was an incredible recognition lever. For them, if you were like a four point nine driver, you had enough rides, you knew you had a chance to make it into being a mentor. And this provided additional earnings opportunity for you. If you did two mentor sessions in an hour, you could make seventy bucks an hour. You could take a break from driving, if you're tired, uh and just do some of those. It felt like getting promoted a job, right? And so it actually had a huge impact on the retention of our very best drivers, which was

51:02 Yeah, kind of unexpected. So lot of like really, really interesting benefits and we actually leaned into this and build like a couple of really fascinating variations of this, uh, you know, for a while. But uh this this allowed us to match most of Uber's footprint with like, you know A tenth or a twentieth of the the resources that Uh you know, I I I'd uh Incredible to speed, I guess.

51:21 That is an amazing story and it's such a great lever that I totally agree I don't hear people Using and I wonder why. So what I'm hearing is it was cheaper The Drivers were making money.

51:32 I imagine the drivers trained by the mentors ended up being better drivers. That's what we saw at R B and B. hosts they came in through a referral ended up being better hosts. For whatever reason. And you're saying basically this is what allowed you to compete with Uber at a much smaller scale. And

51:47 And much less uh money raised. Amazing. Exactly. You said there's like a couple of variations. Is there anything interesting there to share? Just like things that you built as a follow up? Based on the success. So like the next uh step in that journey was basically um we Uh were growing like crazy, but now we had

52:05 With cracked like the the activation phase. But now we had a whole bunch of people like dropping off in the phone like before activation. Like so they didn't enter their SSN or they didn't enter like the right info for us to run like all those checks and the previous steps of the onboarding flow. And so we built a team of, you know, hundreds of account executives, and their job was to just like pick up the phone and like call those drivers. And so we had the same, you know, a hard moment, like Can we get, you know, some of our best drivers to to do that for us?

52:30 And empower them to like, you know, to to to be a part of this. And so uh we did this and we launched like another mic sort of role with we call them recruiters. And so as a recruiter, as a driver, you could just like if this was quiet, uh, you know, on the road. You could just like up on your phone and you would have like a mini sales dashboard where you could like claads.

52:49 And this was like a driver who had dropped off in the funnel. And you had like a tool you phone number, you could like call them and text them. And same thing, those guys were outperforming our very best to like train salespeople. Because it's not like hey, it's Ben from Lyft, like hop on the road, please. It's like hey, my name is like you know James and I'm a fellow driver as well. Like Lyft told me that you have a complete application. Like do you have any questions? Do you want to like come to your house, we can do this together and

53:13 And we would pay them twenty bucks. uh you know cur person that they like converted to activation. Uh and so something like Incredibly scalable for us. another uh way for us to uh to reward and recognize like our best drivers.

53:27 And it also provided like a really interesting way for us to like smooth out the supply and demand. The problem with a marketplace like Lyft is that You have like this big spikes, right? Like everyone wants to drive on a Tuesday at two PM, but Everyone wants rides uh, you know, on a Saturday at two AM, right? And so how can you manufacture demand uh you know, like during those low utilization times, like this was a great way to do that. Now you could like you know wait on the road and like still make money.

53:53 uh, you know, while just sitting in your car while waiting for the next ride. So this was another sort of iteration of this model that was like really cool. Amazing. That is so cool. I've just I just know like the feeling of having of uh being on a team, like coming up with this idea and being working must feel so great. Just like holy shit, look at this. Mm-hmm. Like all these cool things that we can do with our

54:11 Supply. Something I wasn't gonna get into, but I it might be interesting just to hear if you have thoughts on this. So I'm looking at So I've been a huge fan of Lyft from the beginning. I use Lyft the very first weekend it came out in San Francisco and there's like five drivers. It was like a beta test. I was friends with someone that worked at Lift early on and it was just like man, Lift's the best. I was like

54:30 All lift. Uber sucks. I hate that. I l I wanna give it the fist bump or the mustache. So great. Today though, I was just looking at market caps. So Uber is worth a hundred fifty billion dollars. Lift is worth five billion dollars. I'm curious if you have thoughts on just

54:46 Like it feels like Uber has one at this point. And I don't know where Lyft goes. I know you Your heart is with lift and you work the lift for a long time. I know it's not uh it doesn't feel great to see how things have played out necessarily. I'm curious just to hear your take on just like

55:01 Why do you what do you think Uber did if you look back that Allowed them to Basically win and where where do you think lift goes from here? What do you think happens with Lyft? Like they're still worth five billion. It's still a huge, amazing, successful business. Yeah. But just where do you think things go? Yeah. I think um

55:18 It all went south when I left the company I'm just getting. Uh no, I and again I I have to uh Uh I I have to cloud the fact that I haven't been close to like sort of lift and you know, their their business and strategy for you know, like many years at this point. So uh take this with a grain of salt. This is my very naive perspective. But

55:39 Um I think Um Uh To me, perhaps like the biggest Blow to

55:47 uh lift's business was Uh somewhat enhanced like the vision. Lift's vision was always anchored around like transportation, people transportation. The founders were deeply passionate about like moving people, they were passionate about transforming the way. People, you know, uh move around in a city, they wanted to just change like how cities are designed, how roads are designed. Um

56:08 And so that meant uh you know investing in like dynamic, uh, you know, uh uh like shuttles and and things like that. And there's a lot of experimentation that went to that. But it also meant that Lyft never invested in things like food delivery or like goods and parcels and and and things like that.

56:26 And I think uh that crushed them during COVID, essentially. Um Uh I think um Uh Uber had I think at some point like their like slogan was uh you know moving in like bits and and atoms or something like that. But I think it implies this, you know, this this uh notion of

56:44 uh being a like a logistics platform for Mm. assets uh in the world, right? For transporting people, for transporting things, uh for transporting like you know uh and I think um Uh they built they invest a lot in like, you know uh trucks and you know food delivery and like all those like really exotic things uh that lift had never any intention to invest in, not even because of the lack of resources.

57:06 But because this was like in part like a distraction from from our vision. We wanted to change like how people like move around in cities. We want to reinvent like public transportation who we did not want to, you know, be a door dash competitor and help you get in donuts during Covid. And a huge part of it also was you know, leaning heavily in like shed rides. Uh, and so like this was like

57:26 You know, again, how do you reinvent public transportation? It's like Every car is a dynamic bus, uh, and now like there's no bus line. The bus line is like always running, right? It's always like by your house. So a lot of our investment, I think, and thinking went in like that direction. And the last thing that people wanted with COVID was to be in a car with like five strangers. And uh, but what people wanted is like food delivered to the house, right? And so uh that's sort of uh I know that the business like, you know, had a huge blow during COVID, whereas I think Uber was able to like rebound much more quickly because of how diversified the business was. And so uh it's funny now because I think

58:00 Lived actually killed uh shared rides, which was just so core to their identity. They were like the first ones to like launch this, and so Um uh yeah, the new CO, I think, uh killed the shared rights, uh, which I'm really sad about. Um Yeah, so I think it indicates like a very different vision now, a very different like direction for the business. Uh and um yeah. That's my take, I guess. Interesting. So essentially Covid really

58:22 F them because Their strategy was always about transportation. And when de nobody needs a ride and actually people want food. Mm-hmm. Strategically Uber made a really good move expanding into food delivery, which I think was a bigger business than rides for a long time. I don't know where it's at today for Uber.

58:38 Yeah. And Lyft didn't have that and It's hard to recover from a time like that. So it's sounds like it's a combination of strategy was pointing lift in a certain direction and circumstances in the world. Just like

58:49 Mat made it explained. I'm losing but I'm looking at the uh so you left in twenty nineteen, March twenty nineteen. And is that working that we're in public? Yeah. Yeah. And it's like all downhill from then.

59:02 Uh and then And then during Covid actually when there was a big bump, which I think when people started writing again. And then it went down again. So I think there is a correlation there.

59:12 So there we go. That's the thing. Don't ever fire Ben, don't let Ben leep. That's reticulous. I'm just Okay. I was just uh Different ways you might leave a company, don't let happen. No I'm kidding.

59:25 Okay, so there's two more things I wanna spend a little time on before we close up. Uh one is you your work in Europe, so you're a product lead leader in Europe and I wanna hear a little bit about what it's like to be product person in Europe. And then too, I wanna hear about the startup. So at this point no one can actually fire you, you have your own company that you're running? And I want to spend a little time here.

59:43 Usually we don't spend time on this sort of stuff, but you're working on something very cool. I think is gonna be really helpful to a lot of people in a really meaningful way. So wanna spend a little time there. So but before that So you you're living in France now.

59:56 You Before you started your company, you were interviewing for CPO roles in France. You work with a lot of French companies, European companies. I'm curious what you've noticed. Might be different in the cultures of tech companies in France and Europe in general versus the US.

1:00:12 It's been really fascinating. Uh I think so my my entire career has been in the US, uh, and I'm just starting to understand S fuck what that the European and the French market in particular looks like. And Um My my read so far is uh But Product management has really exploded, I think, in Europe in in recent years, but the market dynamics are uh are still quite different.

1:00:34 In the US, I think you have this inherently very liquid and dynamic markets. Um, I think this is my interpretation of it, but I think it leads to greater ownership and accountability for people and product at all levels. So um you know product managers and leaders, they join a startup and uh, you know, you're immediately in charge of a relatively meaningful piece of the business.

1:00:58 Uh with genuine autonomy oftentimes, right? Doesn't always happen, but you know, uh oftentimes I think uh that's the case. And if things don't work out, well, you know, there's this expectation that you'll be managed out. Uh this is just There are countless memes on LinkedIn about the tenure of CPOs at tech companies to illustrate that. I think in France the the market is just much less liquid. Uh, so it's incredibly difficult to change jobs and it's very expensive to fire someone in front. So

1:01:23 It seems to lead to two effects beyond the the obvious job security. Um One is I think PMs tend to have less autonomy and ownership and a little bit more like micromanagement. And They're also less business owners, uh than they can be in the US. Uh, and I see like sort of founders and managers struggling to let go of control a little bit more.

1:01:44 Again because you you know, it's understandable in a way, and you you don't have like as much sort of a control as as you do in the US. Uh and so It is do a lot of like really fascinating sort of effects. You have startups who tend to wait a little bit longer before hiring, especially product.

1:02:00 uh the the art of product is a little bit less of a thing. You have a lot of amazing PMs in France, but the recognition of of the craft uh is you know uh is a little bit different. Outside of the people who practice it. Uh, and you have a lot of, you know, real interesting outsourcing also. You have you see startups and companies of all sizes actually relying on great product studios like Mods are to build end to end products. From the ground up, right? So uh something that's been uh sort of um

1:02:26 Really, really interesting. Um Another Side that I see is You know this sort of like uh dominance of business uh over tech in France. Uh there isn't as much of a you know, cult of technology and software engineering in France, as there is in the US.

1:02:41 And so the the French Ivy League schools are business schools, like Ash I say. And the most highly valuable skill that you get is soft skills around management and business. It's You know, it differs from like the the stereotype of the, you know C S degree, Stanford Dropouts, uh, you know, that you have in in sort of Seacon Valley. Um And I think because of a few of those things that that I just mentioned. less liquid, you know, job market, but also like less liquid financial markets.

1:03:06 The last thing that I've observed that's kind of interesting is you know, that's also around ownership, I guess, is like equity is much less meaningful in France. Ah, so of the product leaders that I talk to you. You know, most of them consider their equity to be like virtually worthless. Uh, none of them know of anyone who's made a down payment on a house, uh, thanks to their sort of equity. So it's seen as like a nice bonus.

1:03:27 But it's not the token of ownership and the the the promise of future wealth that it can be in the US when you join your uh a startup. For for exec roles, I think it's often like sub ten percent of their total compensation. Uh, whereas you know, in the US it's very often like more than fifty percent of your competition will be will be equity. So Um that's been kind of interesting in terms of like the the dynamic, but it's also been Real interesting to just see like how vibrant the sort culture is here in France. You have like a truly exciting innovation happening, especially in AI.

1:03:57 I have a lot of like French companies at the forefront of this with like Mr. LA and Hugging Face and things like that. And Also how How It's been exciting to see how the government is leaning into that as kind of a catalyst for this innovation. Thing there.

1:04:13 French government has dedicated something like uh two point five billion dollars in funding to support French AI excellence by twenty thirty. So Uh, they're running a lot of internal government incubators to try to disrupt some of the, you know. uh government functions from the inside and they're hiring like top towns to do that. Uh I've met some of the people working on this. It's just really fascinating. It's Makes me super excited about, you know.

1:04:35 what a federal setup task we've been inventing the DMB would look like. Uh so uh yeah it's been really exciting to like see sort of like the the the whole space and how it it differs from the US. Fascinating. Do you so I know there's also like AI regulation that feels really strange in Europe, but I think that's EU based, right, not like France specifically. Yeah.

1:04:55 Yeah, that people are tr are like not excited about. There's just like a lot of fear of AI and so there's a lot of uh regulation talk. And I know I'm a big Android guy and I I a lot of the I features like Gemini and all this, like is only available in the US and then

1:05:10 Now that I'm in France, I I I see the difference a little bit. Interesting. Uh so the the cultural Differences you spoke of. Do you think they're rooted in this in the fact that people don't move jobs often? Like what do you or or is it like

1:05:24 Culture, people just don't learn. to work in the way that people learn to work in the US in turn in the product role. Like, what do you think is the root of why Things are so different.

1:05:35 I'm not quite sure. It's a good question. I my take and I think this is I'm sure very naive and and reductive. Um and I know I this is like, you know, one of my sort of core principles. So I'm sure I also have a new tunnel vision on this a little bit, but To me like One

1:05:51 The biggest difference that I see is really around like this concept of ownership and and accountability. Whereas in the US, um, and again, I saw it and I'm sure you saw later, maybe you see that like a lot of companies. Not everywhere, but A lot of companies will be able to do it. You know, uh higher you give your big chunk of the business and it's up to you to like, you know, prove yourself out, right? Like you have six months, you have a year, like you know

1:06:10 It's up to you to actually show impact. I think that the the French employment model uh is less uh conducive to like this type of dynamic. Uh uh because employment is like much more rigid. So uh you have much less of this like You know, higher now and like prove yourself out. Uh it's much more of like

1:06:27 prove yourself like beforehand and uh and if you've made about higher then as a founder like you become perhaps like a little bit cagey about like your vision you want like be more hands on because you made about higher So like someone perfect and like you'll kind of make you work, but it means like you'll be more hands on in like the work of PMs uh you know daily and perhaps you'll think like, Oh, maybe I don't need product managers who want like On my vision, I'll hire project managers or something like that, right? So it's perhaps like slightly more conducive to like those those types of dynamics. And you're saying that's in part because it's harder to fire people in France and in Europe?

1:06:58 Yeah, I think so. And it's not just about firing, I think, to be clear. I just think it's like culturally the market seems like a lot less like liquid uh and dynamic. So people like people don't move around as much, they kinda stick around for a long time. Yeah, exactly. Yeah. Got it. And it sounds like there's also just like a cultural difference of like founders innately are much more I am in control and I'm not gonna hire people and trust you to take this thing off. I am just gonna run the show.

1:07:23 Like it's basically Paul Graham's founder mode is like Maybe, yeah. Maybe maybe that's a little bit and I think also it's this culture of like business, so like very business centric sort of culture. Uh you have And again, it makes sense, right? Like

1:07:37 the markets you have less venture capital, you have less, you know, uh Less the good in the financial markets as well. And so when you raise funding, uh, you need to have like a strong business case. Like the business case is at the center of your happy business. Whereas I think oftentimes in the US, you have again, it's a little bit um It's very typical, but it's a very like tech or product centric view of the world, or it can be uh, you know, a very like tech or product centric view of the world. Like we will be like this product, this is like the vision of the product.

1:08:06 And sometimes even like, you know, the business model will be like will follow, right? Uh And uh and in France I think like the business model like has to be like front and center, perhaps for each like be able to raise venture capital for you to be able to like even exist, right? So it means like it attracts a lot of like business uh you know minded uh you know entrepreneurs much more So perhaps then like uh tech minded or product minded entrepreneurs. Got it.

1:08:30 If someone wants to help their company in Europe and France operate. more closely to the way companies in the US operate. Do you have any advice for them? What do you I know you meant when you talk and work with a lot of companies in Europe. What do you help them? Change and see.

1:08:46 Differently. Yeah, yeah, it's a great question. I Uh I haven't like fully cracked that and think it's uh It's a really hard question. I I'll give like some sort of small pointers, uh that Have

1:08:57 helped at least some of the companies that I talked to, but Uh the one is equity. I think there's like a desire from a lot of the founders that I talk to to like to give equity uh to employees. But because it's not in the culture yet, like I think Employees also have like an under appreciation for like equity. Uh like, Well, yeah, it's nice, but like I don't know what's gonna happen. Like I just Work for the CO anyways.

1:09:17 um there's less of like this sense of again like ownership um that you can have, you know, like the uh in the US. Um and so I think like leaning into that and investing in like You know, education around equity. Uh it's the case also in the US. I'm convinced like you know, eighty percent of people just don't fully understand like their equity. But I think like leaning into that, uh, especially in in Europe to like help understand uh help people understand like the value of their equity, help them uh I you know

1:09:42 Yeah. telling more about like the story of the business, uh, you know, the trajectory of the business, why it matters for their future equity. I think uh any anything along those lines, I think can uh you know help uh cultivate this like greater ownership mindset, I think for for people. Um And then um Yeah, and then uh I think uh another like big piece again is

1:10:03 at least to me, this is a big recipe to successful product teams is to like develop teams that revolve around like this concept of ownership and accounting. Teams are like Clea. ow a huge, you know, or it doesn't have to be huge, but like a slice of the business, like not feature teams like, you know. should be maybe guests, but teams that uh have clear accountability with c consequences, but also like clear ownership and a leeway to Do their best uh and to and to thrive.

1:10:29 Again, I usually don't Spend time on the sort of thing, but I just Think uh what you're working on is extremely cool. And I think it's gonna be really meaningful to a lot of people. And so I just want to spend a few minutes giving you a chance to talk about what you're gonna know. You started a company, is this your first company the year you've started?

1:10:45 It is, yeah. Yeah, yeah, yeah. There's a L C there's a C Corp, or yeah, it's like filed, there's paperwork. Uh amazing. Talk about what you're building. Hel people know how to find it if it's right for them. Yeah, I have to say like Entrepreneurship has been a very humbling journey. I think that

1:11:03 The zero to one is is way harder than anything else I've done so far. Uh And I feel like when you're used to building and scaling products uh within companies, you kinda take for granted, at least I did, uh you take for granted that that the problem space has already been validated, right? you have like some benefit, even if you launch a new vertical, like you know, there's like an existing user base, there's a validation of the broader problem space. I think going to truly zero is like

1:11:28 felt at least to me like super overwhelming and lonely. Uh but also super exciting, right? With tons of condensed learnings. It's been like a really, really interesting journey. Uh so Uh what brought me there is my wife started to have some uh health issues about a few years ago now. It's partially why we decided to uh move to France last year, just for a couple of years. She's had this undiagnosed condition and chronic pain, and we saw just like how much of a nightmare it was to manage, you know, like her care and to navigate the healthcare system in the US. So would wait, you know, three months uh for an appointment for a neurologist, then they'd see her for maybe eight minutes. Average appointment time in the US is between like ten and twelve minutes. Uh

1:12:06 They dump a bunch of jargon uh see like hey it does to look normal, like sorry, like you should just go see this other specialist instead. We'd wait another few months, see another specialist. And that and with a lot of anxiety, a lot of pain, as you can imagine, like all those things, where like you have another eight minute slide with someone and it's like, Oh, why didn't the neurologist do this test? Like I can help you, like this, you know, this makes some sense. And so you just like it ended up being like incredibly isolating, like the whole time, you know We just felt completely alone. It was just like us and Google. Uh, you know, we felt we kept getting conflicting advice from doctors. Um

1:12:38 And I was spending all my time researching specialists, what solutions to consider. Uh, you know, I'd spend all my nights reading through long research papers, uh What is the academic consensus on this particular treatment that the doctors don't seem to know about, right? And Yeah, throughout this whole process it felt like no one, you know, really had her back. No one within the medical system was was fighting for her. The way that your m family doctor uh, you know, might have fought for you twenty years ago.

1:13:04 knowing everything about you and being like Lenin, like, you know, let's talk about this. I know your uncle had this, right? Like there's this sort of like a sense of of advocacy that came from your family doctor that just doesn't exist today, right? It's not uncommon for doctors to have thousands of patients that they see like just a few minutes each year. So digging into this, we just realized like we're you know This is not an isolated case. You have nearly half of Americans have at least like one chronic condition or have to deal with like some sort of like you know, complex healthy issue largely on their own.

1:13:32 Uh, you see a lot of like those, you know, large online communities revolving around like chronic conditions or chronic pain and trying to make sense of it and advocate for themselves. And I think I I want to be clear uh in my mind the problem is obviously not about the practitioners, right? It's it's systemic. It's just growing financial pressure from private equity firms. It's just countless other factors. But you see the physicians being overwhelmed, overworked, you know, burning out, uh, and you see that pressure just, you know, only increasing, I think. So

1:14:01 I basically spent the you know next six months just talking to hundreds of patients and doctors and experts. Um And what we're we built is basically a platform to help people fight for their health. And so we want to close the gap between like patients and the healthcare system. Uh there's this critical layer of the system that's missing, I think. People are navigating, you know, life threatening or debilitating conditions largely with with Google. And at some point you just get tired of fighting for yourself. Right. So We we connect people uh with complex conditions typically with their own health advocate.

1:14:33 Uh, so it's essentially like their own health assistant. Uh they're available 24/7 to help you navigate your care. So we find appointments for you, we help you prepare your appointment, we make sense of a diagnosis of test results, we spend hours like you know researching solutions and potential treatments and Just more generally, we do everything we can to help you A better advocate for for themselves, basically. And Yeah.

1:14:56 Launched um in the US uh early version of this uh uh a few few weeks ago and the engagement has been like really, you know, really really mind blowing so far. Uh I know we've having cancer patients, people with a lot of those sort of like niche chronic conditions. Uh and uh literally harassing the doctor's office like hey, like we still haven't received that referral, like All the things that you just get tired of doing when you're you're dealing with like so many appointments and when you're having to manage a a condition like this. And our our mental model is

1:15:24 What would we do if this user was, you know, our partner or our parent, right? You'd likely like spend all night calm make the research, you'd call like all the providers in the state to be like, Hey, who has an appointment? Because There's no PT available for the next like two months. Like we'll find you a PT available, like, you know, sooner, right? Uh so we're building the engine to do that at scale, essentially, and make people feel like they're not alone and that someone is fighting for them. Super cool. It's sad that we need something like this, but we do because the healthcare system is so

1:15:51 not uh ideal. And so it's basically someone in your corner that's just that's like in the inside that knows how these things work that is there to help you through the process. What's the what's the company called? Where do people find it? Yeah, it's called uh Nura Health, uh and our website is uh Nura N U R A dot M E. Awesome. And we'll link through in the show notes. And just to be clear, I'm not an investor. I'm just like excited about this thing because I think a lot of people need this.

1:16:15 Just to load back to what we've been talking about. It's not a marketplace. How would you describe this business in relation to marketplace companies? We're ignoring the marketplace dynamics. I'm following my own advice. Uh and I'm terms one side of the marketplace. The health advocates were, you know, like uh jump starting this side for now and we're only focusing on what I think is think could be the hardest side for us. And it's going to be demand. Like how do we find those people? How do we

1:16:39 Uh create the right value proposition for them. Uh so that's what we're focused on. So and and so in the future there may be a marketplace component here is what my what I'm hearing. Yeah, exactly. Interesting. Very cool. Ben, is there anything else that you

1:16:54 want to share, mention, leave listeners with before we get to our very exciting lightning round. No. Oh, thank you. Well with that we reached our very exciting lightning round. Ben, are you ready? Woo. I'm ready.

1:17:07 All right. First question. What are two or three books that you've recommended most to other people? I'll give you Books in different directions. Uh one is Misbehaving.

1:17:18 Uh the makings of behavioral economics. I'm really interested in behavioral economics. I love this intersection between economics and human psychology. Like it's a great analogy for for product. So that's a great introduction to this. Field. Um The second book uh that I recommend a lot is Range, Why Journalists Triumph in a Specialised World by David Epstein. Uh I've always felt curious about a lot of things, but it's made me feel like I'm decent at many things, but I'm good at nothing. Uh I'm very good at nothing.

1:17:45 And so uh even my career, I'd see like all those PMs who are like machine learning gurus leading conferences on weekends that were contributing to I think tanks. I just feel like a generalist, you know. Uh so if you feel this way, this is a great book to make you feel a little bit better about yourself uh in your imposter syndrome, at least it did for me. And last one, uh nothing to do with business, uh, but uh immune by Philip Detmer. This is the creator of the YouTube channel, uh Kurz Guz. I don't know if I'm pronouncing this right, but it's a the science sort of channel. It's uh if you're even remotely curious about how your body works, how your immune system works, it's an amazing book. That's really, really fun to read, super entertaining. Uh and uh yeah, just

1:18:23 Great sort of biology and Fun book, I promise. I've been trying to get the author of Range on the podcast and I've not had success yet. So if anyone knows him. Uh with his name is Epstein. There is.

1:18:34 Okay. Um DVDs, yeah. David Epstein, please connect me. I would love to have him on the podcast. I really love his message of just The most Like basically it's the most successful people are

1:18:45 Is it that you should be a generalist, or that you can be very successful as a generalist? Is that the message? You can be very successful as a generalist. I completely agree. That's been me too. Next question. Do you have a favorite recent movie or TV show you've really enjoyed? To be sure, I haven't seen anything lately that's been like mind blowing, but I'll I'll share an old new one. Uh I've re watched The Last of Us recently and I just it's uh an old favorite. I just I love the T show. Like the game, played the game many years ago, uh and love the T show. When the heck's the next season coming up. Excited for that. I know'cause I know the game has more.

1:19:16 Yeah. Oh man. Yeah. Hello. Okay. Uh Next question. Do you have a favorite product you recently discovered that you really love?

1:19:25 Maybe a little bit behind the curve on this one, but uh I've been uh loving the Arc browser. Uh I don't know if you use it, but I love Arc it's my number one my main browser. Absolutely. I love it. Amazing. All right. So yeah, y you know all about it, yeah. It's It's been really fun. Uh yeah, it's it's like uh just the onboarding of the Arc browser is

1:19:44 Such a lesson in onboarding. They do such an amazing job. Like that alone is a great thing to do as a product person, just see how they do onboarding. I was like, I've been using Chrome for like twelve years or I don't know how many years like it feels like such high friction to change my entire life.

1:20:00 In like eight seconds, it was done, it felt like home. I was like, Wow, this is way faster than I expected. Two more questions. Do you have a favorite life motto? That you often come back to repeat yourself, share friends or in family. I don't have anything like particularly philosophical, unfortunately. Uh I I lived in

1:20:15 I hope for a few years I live now in the French Alps, so I have a Frame with John Muir's quote, The Mams are calling and I must go. I feel like this is uh I it's my sort of grounding place, like the mountains are And so

1:20:27 Uh I don't share that work often. I don't like piece out and mill meetings like the men's are calling on this go. But uh but uh but it's been sort of like a grounding uh you know, sort of a uh yeah, but I guess I mean. That's beautiful. That just m my nervous system relaxes just hearing that quote. And I know you live in a mountain y part of France, so you've done it. You've Mm.

1:20:47 You've listened to the call. Final question. Uh You live in France, the Olympics are just in Paris. Uh, did you go to any of the games?

1:20:56 Did you watch any of the games, anything stand out to you but the Olympics that were not so far from where you are now? Great question. I uh Did not see any live events, unfortunately. Um I perhaps like the highlight for me was I'm a big man biker. Uh Uh but uh uh in s like the biking realm, I love the

1:21:16 the uh men BMX uh event where like uh all three men on the podium were were French. Uh so this was like a kind of a Great moment for France. I didn't even know that was an Olympic sports. It's a BMX like mountain Like dirt bite kind of uh race. Yeah, yeah.

1:21:33 So cool. Amazing. Ben, thank you so much for being here. Two final questions. Where can folks find you online? And what else are you doing that people can check out? If they want to learn more.

1:21:44 And I can listener is beautiful to you. Yeah. You can find me uh Two things that are perhaps helpful for for people out there. Um

1:21:52 One is I have a Reforge course. So if you're curious about marketplace, uh if you wanna dig deeper into marketplace growth, um I have a a course on Reforge. Uh we're about to do our Fifth or sixth court, I think now. Uh, it's been going really well. Uh we've been working with tons of really, really cool marketplaces going much deeper into some of the topics that we just talked about. So If you're interested in marketplaces, I would say uh check this out. And on that real quick. Is the customer ideal? Is it founders or is it like PMs on marketpla at larger marketplace companies? Who is this perfect for?

1:22:22 It's Uh we've had both founders and PMs and sort of like uh heads of product, but it's my strong recommendation it's uh people that have product market fit. Again, per or Uh Pro conversation. Uh if you don't have program fit, uh, you know. wait uh a little bit before enrolling in this course, uh focus on you know

1:22:39 your core business, uh Yeah. And then I cut you off if there's something else you're gonna point people to. Oh and just uh Nura. Uh the company that we're building, uh anyone that you know or if you yourself have sort of

1:22:54 chronic or complex conditions, uh, and if you feel like you need help managing your your health and navigating your care. uh you know, uh would love to to help or or share how uh what you need and how we can help you. Uh and our website is Nura.me. And then how can listeners be useful to you? If you have advice if you know uh anyone in the space, if you're interested in like learning more about this, if you have like advice, if you have learnings, uh if you know anything about this, I would love to hear it. Uh, if you have like hot takes about marketplace if you disagree with any of what I've said, I'd love to also hear it. I love it.

1:23:26 Ben, thank you so much for being here. Thank you so much for having me. It's been a dream come true, finally. Same. Same for me, Ben. Bye everyone.

1:23:39 Thank you so much for listening. If you found this valuable, you can subscribe to the show on Apple Podcasts, Spotify, or your favorite podcast app. Also, please consider giving us a rating or leaving a review, as that really helps other listeners find the podcast. You can find all past episodes or learn more about the show. at Lenny's podcast dot com. See you in the next episode.

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