Some disconnected thoughts about marketplaces, decentralization and trust:
The first wave of marketplaces has been about setting up intermediaries between suppliers and customers across different industries. Sometimes the supply has come from existing sources (e.g. Expedia for Hotels and Flights), and other times a marketplace distinguishes itself because of a unique form of supply (Airbnb, Uber). Customers obviously benefit from convenience and access to this supplier.
For suppliers, these intermediaries did well to establish a source of revenue that perhaps didn’t exist before - e.g. for drivers of UberX, hosts on Airbnb. In many cases, that has become a significant portion of personal income and there are countless stories of people leaving their day jobs. These folks are often makers, creators and entrepreneurs in their own right.
But as these intermediaries become more powerful, they often do things to drive marketplace value, (or sometimes, just in the name of customer centricity) that ends up harming these suppliers.
What I believe will end up happening is a new crop of companies that exist solely to help these entrepreneurs operate as independent entities. These companies will provide suppliers with what the marketplaces do - the ability to reach customers, manage the customer relationship, and ensure that their customers are being fulfilled. This is already well underway in retail (Shopify being the clear example here), but also in journalism (Substack), Food delivery (Dumpling), and others.
This is how I believe decentralization takes place - through a slow erosion trust in intermediaries that are acting to optimize the overall marketplace versus trying to make their suppliers successful.
In future posts, I’ll explore how trust in the intermediary gets eroded on the customer end, and what opportunities that will create.