How do service oriented sites start with content? For instance, when a site such as ebay or elance.com start, they woudl need some type of auctions already posted to generate interest in new customers and to gain credibility. What is the best plan of action for this?
Invite some people to participate in a beta? People will be lured by the opportunity for participation in an exclusive community, and at the same time, they will understand why there's no other content. Then, when the site launches to the public, you will have some content. There's also the obvious benefit of being able to squash any bugs before you go public that wouldn't have come up unless there was a diverse/larger group of users.
It's a bit like the chicken and the egg. You need the content to attract users but you need the users to get the content...to attract users. So they start small, find users through networking, through just the sheer value of the product and users telling other users. Then as things start to grow, typically marketing and business development efforts will focus on both sides of the equation, greater on one or the other if it gets out of balance. Eventually if it's a strong offering it will grow and the balance will naturally occur.
An example is AuctionWeb/eBay. Initially it was a small number of people who bought and sold a pretty small number of items. It grew as people discovered it through word of mouth. Over the years eBay has done marketing to attract more buyers and done marketing to attract more sellers. I'd guess the balance is determined by how they see the balance in their marketplace.
Sometimes you do not start. For some time. Twitter, for example, was pretty much a dead project for years until the critical mass was reached.