Great article. Wish I read it earlier. I started a company (graduate jobs board) which failed remarkably. I had no idea the extent of difficulties I would face. The hardest thing was getting the "buyers" - i.e. the employers - to advertise. The "sellers" - the graduates & students - was a piece of cake. 1,000 users in a couple of months. But without buyers, the whole thing was for naught.
The other thing I noticed in the "marketplace" business model is that the leader is able to reinforce their market position and take the lion's share of the market. It's very difficult you're up against a competitor like that but if you're establishing yourself to be the leader and succeed, it's extremely profitable. The CEO of Australia's leading job site, seek.com.au, commented that unless you have market leadership in "marketplace" business models, it's not worthwhile.
