The Power and Perils of Two Sided Marketplaces

Our co-founder and COO, Brett Crosby, recently wrote an article for Entrepreneur.com that discusses the power and perils of two sided marketplaces, and offered his thoughts on how to best build one from his years of experience at PeerStreet. He reflects on some of the specific opportunities and challenges he has learned at PeerStreet and provides examples of other two-sided marketplaces that have flourished - and in many ways, dominated - their respective industries. 

When our founders started PeerStreet, they often found it difficult to explain exactly what our platform is, and the scope of what we had set out to build. PeerStreet isn’t exactly a “marketplace lender”, nor is it a “crowdfunding platform” in the traditional sense of those commonly used categories in our space. PeerStreet is the industry’s first two-sided marketplace for investing in real estate debt with investors on one side and lenders on the other.

From the article, “as my co-founder Brew Johnson likes to say, ‘a one-sided marketplace builds one business; a two-sided marketplace scales thousands of businesses.’ This is the social impact element of two-sided marketplaces and one of its defining advantages.”

This model allows accredited investors to make more informed decisions and diversify their portfolios with unprecedented data and transparency into their investment options. It also provides private lenders with diverse capital sources and technology to make lending processes more efficient. That means they can make more loans to real estate investors who can then purchase and enhance more investment properties. Check out the article and let us know what you think.

Another fantastic piece on the power of two-sided FinTech marketplaces was recently penned by Pete Flint at NFX. It gives additional insights and examples specific to the FinTech space.

If you or someone you know is passionate about aligning the interests of two-sided marketplaces, we’d love to talk to them about a career here at PeerStreet.

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