$1.5 Million to take on Craigslist. Good Luck. | Hacker News Reader

$1.5 Million to take on Craigslist. Good Luck.

techcrunch.com

6 pointsrokhayakebe11 comments

I think all the people saying it's hard to take on craigslist are right.

My own spin on it is simply that craigslist has been around since the dawn of the popular web, it was founded in 1995, and started growing rapidly in 1999. The fact is, it takes time to build the network effect inherent in business models like craigslist (and ebay, also founded 1995).

The current startups trying to tackle these problems all seem stuck in the 'get big fast' mode of the 2000 bubble era companies, aiming for millions of users in a couple years. It ain't gonna happen (most likely). You are most likely going to be growing slowly, and if you really want success in this field, you need patience to whether the storm of not much activity (we're talking years here, I'd say minimum 4).

But most start ups usually aren't built for that, they are taking 1.5 million funding, burning through it promising big returns and large growth month over month, and investors get tired of that game real quick if a site is not delivering.

I think it's a good opportunity from someone in the hacker news mindset to build something simple NOW, work on it on the side for a few years (4+), and see what happens. Heck, I may do it myself.

Countless articles I've read about Craigslist say they could make a lot more money than they do if they were more business-like, more aggressive. They choose not to. As I understand, they only charge for job ads, nothing else.

Also, a small but important point about the identity of Craigslist as a community is that Craig Newmark has a purpose behind sticking with .org instead of .com.

In Norway there's a service called Finn (www.finn.no), that translates to "Find"

They were backed by a large news corporation, so that probably helped. The corporation really didn't want to look too much at classifieds on the internet, since they had a paper business to protect. That's why they waited until 2000 before the site was released.

When it comes to real estate, I think they have close to 100% of the market. Only real estate agents are allowed to post ads, and I think they pay a lot to do so.

They are also huge in the motor market. You have to pay 76 USD to add your used car to the listing. There are numerous free alternatives, but people still use Finn because it is the place to go.

When free alternatives can't compete, what can? When someone has a lot of market share, it is hard to compete.

But on the positive side, there's not a lot of spam :-)

Examples: http://www.finn.no/finn/car/used/result?CAR_MAKE=749

http://www.finn.no/finn/realestate/homes/result?areaId=20061

This is interesting, especially after yesterdays thread (http://news.ycombinator.com/item?id=281741). I think we determined social functionality wasn't the answer. Hope they read that before they launch :)

The way to take on Craigslist is 1) to be better than they are, which is not hard, and 2) to have some way of getting past their network effect advantage. 2) is hard. Maybe it can be accomplished in a particular niche. But you aren't going to be able to take them on across the board without a lot of resources.

I'm not sure I agree. I've heard the sentiment that the network effect is unbeatable a few times. I think people are so hungry to take over CL's market that if you had a good product it shouldn't be so hard to get it well publicized. ESPECIALLY if you beat them in how housing is done.

There's no need to take on the rants and raves service CL provides.

Words placed in my mouth again. I don't think Craigslist is unbeatable. I just think that beating the network effect is going to be hard. Either have a lot of resources, or do a tactical concentration in one area. Apparently, there are lots of competitors to Craigslist overseas because they could avoid the network effect. There are also local market competitors.

I responded to you, but the sentiment I mention is here on HN in a bunch of places.

Why isn't eBay's Kijiji doing better in the US? They've got tons of money and resources.

probably will fail. Facebook marketplace is pretty much what these guys sound like, and its a failure. And these guys are trying to replicate this w/o the millions of users

Facebook's marketplace failed cause it wasn't a core product and they didn't want to advertise it. I'll bet most members didn't even know it was there.

Reply on news.ycombinator.com