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Operations as a Platform

As I've written in prior blog posts, the talent marketplace space, precipitated by the Market Network business model, has exploded. The quality of founders entering this space is remarkable.

Everyone I talk to that is looking to start a talent marketplace, and who have also had prior success in starting companies, has said their motivation is: "It was hardest for me to hire the talent I needed in my past scaling company." It's shocking how consistent this is.  Even the Hired founders cited this as their motivation for entering the space.  The problem is universally painful and necessary to solve so that great companies can be built and achieve their missions.

Lost in the harried genesis of starting a marketplace is productizing operations. It's a very thorny problem requiring deep understanding of the talent space while trading off the need for human touch in bespoke transactions and the scale necessary to maintain favorable unit economics.

In having these conversations, there are two issues that come up:

1) Productizing Ops too late in the company's lifecycle: When a team is built and a process is working, it's hard to blow it up. It gets harder the larger the company is and too often it is de-prioritized until it is too late.

2) Disjointed Product Experience: Because ops is so heavy and complicated it can't possibly live in one product team. So, the product is serialized with different owners at each stage of the transactional journey. This creates thrash, inability to metric teams effectively and results in a decreasing quality of experience for the end users over time.

The combo of increasing overhead and decreasing quality of experience creates a death spiral that can be often mis-diagnosed as a demand problem, marketplace problem, or growth problem. In effect, all of these are problems but they are caused by the ops dependency decreasing efficiency on all aspects of the marketplace.

To solve this, I think establishing platform teams owning the operations pieces of the journey is critical and will allow for the establishment of a true experience product team that can own the whole candidate journey.

This orientation doesn't make sense when the team is small, but I think raising sufficient capital early (pre-C stage) to staff up platform teams supporting ops is critical. You will either spend this capital on large and fast growing Ops headcount down the road or nip it in the bud early enough to ensure that you don't scale your marketplace in to oblivion (where unit economics no longer support long term investment or further growth).

With so many talent marketplaces starting off on this journey, I advise them to have this in their strategic plans. It's not a nice to have, it is ultimately the thorniest problem to getting to scale. It's where you should be investing your effort.

I often bring Uber up as a classic example of a productized ops success story. Their business has many intrinsic benefits that make it more scalable than talent marketplaces, but that just means that talent marketplaces need to be even more aggressive about building out platform teams that will scale operations.

Trent Krupp

Currently Head of Product at Impact, a market network serving the entertainment industry. Previously, Head of Revenue at Triplebyte and Hired. Founded an agency in my 20's, sold it to Hired and became employee 5. Recruited for Atomic (VC), Credit Sesame and MakerSights. Helped the founders of recruitment tech startups Shift.org, Terminal and Beacon in the early days.

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