Ramesh Johari is a professor at Stanford University focusing on data science methods and practice, as well as the design and operation of online markets and platforms. Beyond academia, Ramesh has advised some incredible startups, including Airbnb, Uber, Bumble, and Stitch Fix. Today we discuss: • What exactly a marketplace is, if you boil it down • What you need to get right to build a successful marketplace • How to optimize any marketplace • An easy litmus test to see if there’s an opportunity to build a marketplace in the space • The role of data science in successful marketplaces • Ramesh’s philosophy on experimentation and AI • Advice on implementing rating systems • Why learning isn’t free — Brought to you by Sanity—The most customizable content layer to power your growth engine: https://www.sanity.io/lenny | Hex—Helping teams ask and answer data questions by working together: https://www.hex.tech/lenny | Eppo—Run reliable, impactful experiments: https://www.geteppo.com/ Find the full transcript at: https://www.lennyspodcast.com/marketplace-lessons-from-uber-airbnb-bumble-and-more-ramesh-johari-stanford-professor-startup/ Where to find Ramesh Johari: • LinkedIn: https://www.linkedin.com/in/rameshjohari/ • Website: https://web.stanford.edu/~rjohari/ • X: https://twitter.com/rameshjohari Where to find Lenny: • Newsletter: https://www.lennysnewsletter.com • X: https://twitter.com/lennysan • LinkedIn: https://www.linkedin.com/in/lennyrachitsky/ In this episode, we cover: Referenced: • Riley Newman on LinkedIn: https://www.linkedin.com/in/rileynewman/ • Upwork (formerly Odesk): https://www.upwork.com/ • Ancient Agora: https://en.wikipedia.org/wiki/Ancient_Agora_of_Athens • Trajan’s Market: https://en.wikipedia.org/wiki/Trajan%27s_Market • Kayak: https://www.kayak.com/ • UrbanSitter: https://www.urbansitter.com/ • Thumbtack: https://www.thumbtack.com/ • Substack: https://substack.com/ • Ebay: https://www.ebay.com/ • Coase: “The Nature of the Firm”: https://en.wikipedia.org/wiki/The_Nature_of_the_Firm • Stitch Fix: https://www.stitchfix.com/ • A/B Testing with Fat Tails: https://www.journals.uchicago.edu/doi/abs/10.1086/710607 • The ultimate guide to A/B testing | Ronny Kohavi (Airbnb, Microsoft, Amazon): https://www.lennyspodcast.com/the-ultimate-guide-to-ab-testing-ronny-kohavi-airbnb-microsoft-amazon/ • Servaes Tholen on LinkedIn: https://www.linkedin.com/in/servaestholen/ • Bayesian A/B Testing: A More Calculated Approach to an A/B Test: https://blog.hubspot.com/marketing/bayesian-ab-testing • Designing Informative Rating Systems: Evidence from an Online Labor Market: https://arxiv.org/abs/1810.13028 • Reputation and Feedback Systems in Online Platform Markets: https://faculty.haas.berkeley.edu/stadelis/Annual_Review_Tadelis.pdf • How to Lie with Statistics: https://www.amazon.com/How-Lie-Statistics-Darrell-Huff/dp/0393310728 • David Freedman’s books on Amazon: https://www.amazon.com/stores/David-Freedman/author/B001IGLSGA • Four Thousand Weeks: Time Management for Mortals: https://www.amazon.com/Four-Thousand-Weeks-Management-Mortals/dp/0374159122 • The Alpinist on Prime Video: https://www.amazon.com/Alpinist-Peter-Mortimer/dp/B09KYDWVVC • Only Murders in the Building on Hulu: https://www.hulu.com/series/only-murders-in-the-building-ef31c7e1-cd0f-4e07-848d-1cbfedb50ddf Production and marketing by https://penname.co/. For inquiries about sponsoring the podcast, email podcast@lennyrachitsky.com. Lenny may be an investor in the companies discussed.