Solving the Chicken and Egg Problem


11

My partner and I are in the development phase of a website which essentially is a new marketplace for a sector that we believe is lacking one.

However most of our resources are going for design and development leaving us with just a couple of thousands to solve the "chicken and egg problem" (reach critical mass) and we believe that it will be difficult to get funding before we have a proof that we have a business in our hands.

How do we attack this problem?

Marketing Launch

asked Nov 14 '09 at 19:44
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Gera
91 points

2 Answers


16

Focus on satisfying one side of the equation first. Pick the chicken, or the egg. Make sure they can see the value early in time.

Example: Del.icio.us, the founder made it valuable even if it's used by a single user (bookmark). It provides additional value as it reaches critical mass (share etc).

There are few techniques you can use to do that (references below). That's the best i can say without any clear idea what marketplaces you guys are building.

Few more links that you might want to read about this problem that kill heaps of startups:

Hope that helps.
answered Nov 14 '09 at 20:41
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Hendro Wijaya
1,408 points

1

Is it really a problem? I don't think so.

Your idea must reduce an inefficiency that currently exists, this is my start-up equation -

execution

High inefficiency + efforts/investment --------------> Low inefficiency + Benefits/Money
Also read this answer by Alex - http://www.brightjourney.com/q/learn-internet-business-charts
answered Nov 15 '09 at 20:31
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Arpit Tambi
1,050 points

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