From Social Networks To Market Networks

From Social Networks To Market Networks

Most people didn’t notice last month when a 35-person company in San Francisco called HoneyBook announced a $22 million Series B*.

What was unusual about the deal is that nearly all the best-known Silicon Valley VCs competed for it. That’s because HoneyBook is a prime example of an important new category of digital company that combines the best elements of networks like Facebook with marketplaces like Airbnb — what we call a market network.

Market networks will produce a new class of unicorn companies and impact how millions of service professionals will work and earn their living.

What Is A Market Network?

“Marketplaces” provide transactions among multiple buyers and multiple sellers — like eBay, Etsy, Uber and LendingClub.

“Networks” provide profiles that project a person’s identity, then lets them communicate in a 360-degree pattern with other people in the network. Think Facebook, Twitter and LinkedIn.

What’s unique about market networks is that they:

  • Combine the main elements of both networks and marketplaces
  • Use SaaS workflow software to focus action around longer-term projects, not just a quick transaction
  • Promote the service provider as a differentiated individual, helping to build long-term relationships

An example will help: Let’s go back to HoneyBook, a market network for the events industry.

An event planner builds a profile on HoneyBook.com. That profile serves as her professional home on the web. She uses the HoneyBook SaaS workflow to send self-branded proposals to clients and sign contracts digitally.

She then connects to that project the other professionals she works with, like florists and photographers. They also get profiles on HoneyBook, and everyone can team up to service a client, send each other proposals, sign contracts and get paid by everyone else.

This many-to-many transaction pattern is key. HoneyBook is an N-sided marketplace — transactions happen in a 360-degree pattern like a network. That makes HoneyBook both a marketplace and network.

A market network often starts by enhancing a network of professionals that exists offline. Many of them have been transacting with each other for years using fax, checks, overnight packages and phone calls.

By moving these connections and transactions into software, a market network makes it significantly easier for professionals to operate their businesses and clients to get better service.

We’ve Seen This Before

AngelList is also a market network*. I don’t know if it was the first, but Naval Ravikant and Babak Nivi deserve a lot of credit for pioneering the model in 2010.

On AngelList, the pattern is similar. The startup CEO can complete her fundraising paperwork through the AngelList SaaS workflow, and everyone in the network can share deals, hire employees and find customers in a 360-degree pattern.

Joist is another good example. Based in Toronto, it provides a market network for the home remodel and construction industry. Houzz is also in that space, with broader reach and a different approach*. DotLoop in Cincinnati shows the same pattern for the residential real estate brokerage industry.

 

Looking at AngelList, Joist, Houzz, DotLoop and HoneyBook, the market network pattern is visible.

Six Attributes Of A Successful Market Network

Market networks target more complex services. In the last six years, the tech industry has obsessed over on-demand labor marketplaces for quick transactions of simple services. Companies like Uber, Mechanical Turk, Thumbtack, Luxe and many others make it efficient to buy simple services whose quality is judged objectively. Their success is based on commodifying the people on both sides of the marketplace.

However, the highest value services — like event planning and home remodeling — are neither simple nor objectively judged. They are more involved and longer term. Market networks are designed for these types of services.

People matter. With complex services, each client is unique, and the professional they get matters. Would you hand over your wedding to just anyone? Or your home remodel? The people on both sides of those equations are not interchangeable like they are with Lyft or Uber. Each person brings unique opinions, expertise and relationships to the transaction. A market network is designed to acknowledge that as a core tenet — and provide a solution.

Collaboration happens around a project. For most complex services, multiple professionals collaborate among themselves — and with a client — over a period of time. The SaaS at the center of market networks focuses the action on a project that can take days or years to complete.

Market networks help build long-term relationships. Market networks bring a career’s worth of professional connections online and make them more useful. For years, social networks like LinkedIn and Facebook have helped build long-term relationships. However, until market networks, they hadn’t been used for commerce and transactions.

Referrals flow freely. In these industries, referrals are gold, for both the client and the service professional. The market network software is designed to make referrals simple and more frequent.

Market networks increase transaction velocity and satisfaction. By putting the network of professionals and clients into software, the market network increases transaction velocity for everyone. It increases the close rate on proposals and expedites payment. The software also increases customer satisfaction scores, reduces miscommunication and makes the work pleasing and beautiful. Never underestimate pleasing and beautiful.

Social Networks Were The Last 10 Years. Market Networks Will Be The Next 10.

First we had communication networks, like telephones and email. Then we had social networks, like Facebook and LinkedIn. Now we have market networks, like HoneyBook, AngelList, Houzz, DotLoop and Joist.

You can imagine a market network for every industry where professionals are not interchangeable: law, travel, real estate, media production, architecture, investment banking, personal finance, construction, management consulting and more. Each market network will have different attributes that make it work in each vertical, but the principles will remain the same.

Over time, nearly all independent professionals and their clients will conduct business through the market network of their industry. We’re just seeing the beginning of it now.

Market networks will have a massive positive impact on how millions of people work and live, and how hundreds of millions of people buy better services.

I hope more entrepreneurs will set their sights on building these businesses. It’s time. They are hard products to get right, but the payoff is potentially massive.

by (@JamesCurrier)

Is Markethive one of the new pioneers called a Market Network?
Please comment below what do you think?

There Is No Such Thing As Flexible Work

Technology was meant to herald a new way of working anytime, anywhere – but that’s not the case.

Original article by Georgina Kenyon

We didn’t get the flying cars or the self-lacing shoes. But we did get the work world of the future – you know, the one where the internet allows us to work anytime, anywhere, resulting in the death of the 9-to-5 life.

Our ability to trust each other has not advanced in parallel with the technology we have created

Oh, wait. As more and more companies promise flexibility, the reality, it turns out, is pretty far from the culture we dreamed of.

For almost all of us, flexible work really means working a few hours each side of the core workday of 09:00 and 17:00. And, if you think about it, that makes sense, because many businesses still run within those core hours when markets are open, banks process deposits and payments and daylight makes it easier for tradespeople to do their jobs, for example.

 

(Credit: iStock)

Flexible hours have made working from home possible for many – but how many people actually make the most of it? (Credit: iStock)

But while digital technology has enabled a very small degree of flexibility around the regular working day for some, there have been unseen and sometimes unsettling repercussions for employees and employers. For instance, experts say that always emailing your staff and colleagues, even though they sit a metre from you, has had a hidden, but very real impact on morale and trust.

That, in turn, has made truly flexible work nearly impossible for most of us.“There can be a dark side of innovation, and unintended consequences of some organisational innovations,” says Almudena Cañibano, lecturer in human resource management at ESCP Europe, a business school in Madrid, Spain.

No matter how much a work rock star you might be, your manager does not trust you

Our ability to trust each other has not advanced in parallel with the technology we have created. And therein lies one of the real reasons flexible work is little more than a catch phrase. No matter how much a work rock star you might be, your manager does not trust you. Your colleagues do not trust your manager. And, truth be told, you probably don’t trust most of your colleagues or your boss, either.

Trust and the digital age

For Rachel Botsman, a visiting economics lecturer at the University of Oxford’s Saïd Business School, it’s simple: “Institutional trust isn’t designed for the digital age.”

 

(Credit: Alamy)

Technology has let us work anywhere, anytime – but trust issues can get in the way (Credit: Alamy)

 

That’s also the case for the trust people have towards colleagues, within organisations. Perhaps not surprisingly, then, we’re also less able to understand or make room to consider each person as, well, a person.

"The digital age… has resulted in an ‘assault on empathy’, that makes us less able to appreciate the situation of another person,” writes Sherry Turkle, director of the Initiative on Technology and Self at the Massachusetts Institute of Technology.

A lack of trust brings about fear, which goes a long way to explaining why we put in face time, even when we probably don’t need to

In other words, the propensity for email, texting and quick-type apps has led us to forget some of our people skills, including distinguishing the nuances of language and meaning, fostering of a feeling of belonging among groups of people, and knowing our bosses and colleagues well enough to have confidence that others will pull their weight. That, in turn, has diminished implicit and earned trust among the people we work with.

 

(Credit: Alamy)

Technology has disrupted the workplace – and not always for the better (Credit: Alamy)

 

That lack of trust brings about fear, which goes a long way to explaining why we put in face time, even when we probably don’t need to in order to do our work well. It also can explains why we feel we’ve got to have our “butt in the seat” even if our work could truly be done from the corner café or the back garden.

Mother, may I?

Phyllis Moen, professor of sociology at the University of Minnesota in the US, calls this the ‘mother, may I’ problem. It’s when we feel fearful of asking our managers if we can work from home or work altered hours if, say, we need to help a relative or attend a series of medical appointments or simply want to work during hours we’re feeling more productive or efficient.

 

(Credit: Alamy)

While it is technically possible for many to work odd hours, the majority of us only need flexibility a couple of hours either side of the typical 9-to-5 day (Credit: Alamy)

 

Some workplace psychologists take it a step further, saying that modern technology is a way for employers to constantly keep surveillance over their staff. In turn, people are increasingly suffering from the impacts of feeling watched, even when they are allowed to work remotely. The Future Work Centre in London released findings earlier this year that showed the emotional reactions we have to constantly being connected to our work causes “a toxic source of stress.”

As a result, we often start thinking up more ‘creative’ ways of excusing ourselves to create flexibility.

What next

There’s also the worry that flexible work options may actually get more limited as automation and advances in information technology now threaten many traditional white-collar jobs, such as accounting and law.  And that’s led to a feeling of insecurity that keeps people in their seats, playing out face time for the boss, and avoiding flexible options when they are available.

As a result of job insecurity, even when flexible work options are offered in a workplace, employees do not always take them up

One report from the World Economic Forum examines how, just as technology made manufacturing largely automated, now white-collar jobs will be automated (for example, when selling a house, the seller will fill in all the required information for an 'online solicitor').

As a result of job insecurity, even when flexible work options are offered in a workplace, employees do not always take them up. Being present it seems in the workplace, seems the most secure option for most.

 

(Credit: Getty Images)

As automation threatens more jobs, it may seem more important to be present in the office (Credit: Getty Images)

 

But, that could be counterproductive for employers. The more control that we have over our time – of when and where we work – the more job satisfaction increases, says Moen. The University of Warwick in the UK found that being happy at work makes people, on average, 12% more productive. In the paper, the researchers found that happier workers use the time they have more effectively, increasing the pace at which people work without sacrificing quality.

In reality, for some of us, the flexibility of a few hours outside of core hours actually turns out to be enough to improve quality of life. 

In Spain, Iberdrola, one of the country’s largest utilities companies, decided a few years ago to allow its employees to choose working 08:00 to 15:00 with no lunch break – a major change in a country where most people work 09:00 to 19:00 with a two-hour lunch break. The company reported employee satisfaction levels increased as a result and lower turnover (90% of the workforce has been with the company for more than five years).

Changing habits

How do you change a workplace culture? Bring in blanket company rules, say some experts, making benefits universal to all staff if possible. Financial company Moody’s instituted a policy that women returning from maternity leave do not have to fulfil the usual 'billable hours' for several months. “Middle ranking managers can also help introduce flexible and healthy workplaces by getting rid of low value work – like meetings every Monday with no agenda,” says Moen.

“It’s said that to understand something you should try to change it. We are trying to redesign working conditions, giving employees greater flexibility and control over their time with more supportive supervisors,” says Moen.

But, maybe like flying cars in the film Back to the Future, truly flexible work wasn’t ever really going to happen.

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Stephen Hodgkiss
Chief Engineer at MarketHive

markethive.com


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