From Teen Student Entrepreneur in Australia to a Mature Global E-commerce Entrepreneur: Mike Rosenbaum, CEO of Spacer (Part 6)

Sramana Mitra: What are the metrics? How many buy side and how many sell side do you have?

Mike Rosenbaum: We have over 50,000 locations across Australia and over 200,000 members on our platform. In the US, we have over 10,000 locations now. It’s growing rapidly. The key thing for us is to keep balancing supply and demand at that hyperlocal level. That’s something we’re optimizing. 

Sramana Mitra: To launch a new location, how many suppliers do you need for your to be able to bring the buy side on?

Mike Rosenbaum: You want to have lots of pins on the map. I work at this particular building. I want a two to three minute walk from where I want to be. That’s quite challenging. It depends on that location. If that location is only six blocks, then maybe you only need 10 listings. If it’s a bigger area, maybe you need a hundred listings to make it work. You have to have some choice for the customer. 

Sramana Mitra: Do you use online marketing like Google AdWords and Facebook marketing for acquiring the sell side and the buy side?

Mike Rosenbaum: We do. It’s getting more expensive. Back then, it started at 20 cents. It’s expensive now, but it’s a part of our marketing mix.

Sramana Mitra: What is your primary marketing strategy if Google and Facebook is too expensive? What works?

Mike Rosenbaum: The beauty of marketplaces is that once you are the destination and you’ve got great supply, your SEO does very well. Google loves great content. If people are looking for parking and you have the most listings, Google rewards that. It’s a long-term play. If you look at marketplaces, they do rank very well. 

Sramana Mitra: Before you get critical mass in a particular hyperlocal area, how do you market?

Mike Rosenbaum: That’s why you need to raise a lot of capital. You have to pay for those customers. There’s no other way. You can do it more cleverly. You can try different things and see what works.

Sramana Mitra: You have to seed the marketplace with Google Ads and Facebook. Then once there is critical mass, the SEO kicks in gear.

Mike Rosenbaum: That’s why I strongly believe you cannot bootstrap a marketplace.

Sramana Mitra: You’re absolutely right. It’s very hard to bootstrap a marketplace. It also takes time. It’s not something that become profitable very quickly. Once it scales, it scales very well, but it takes time to get to that.

Thank you for your time.

This segment is part 6 in the series : From Teen Student Entrepreneur in Australia to a Mature Global E-commerce Entrepreneur: Mike Rosenbaum, CEO of Spacer
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