Matchmakers: The New Economics of Multisided Platforms

Matchmakers examines the economics and business dynamics of platforms that connect different groups of customers. The book analyzes how companies like OpenTable, Uber, and Alibaba create value by reducing friction between parties who want to conduct transactions. Authors Evans and Schmalensee draw from decades of research to explain the core principles behind successful platform businesses. Through case studies and economic frameworks, they demonstrate how matchmakers must solve the chicken-and-egg problem of attracting multiple sides of the market simultaneously. The book tracks the evolution of matchmaking businesses from ancient bazaars to modern digital platforms. It dissects both successes and failures to reveal the strategies that help platforms achieve critical mass and maintain sustainable growth. This work offers a systematic analysis of how platforms reshape markets and challenge traditional economic theories about how businesses create value. The frameworks presented have implications for entrepreneurs, investors, and policymakers grappling with the rise of platform business models.

Readers describe this book as a practical guide to platform economics that bridges academic theory and real business applications. The examples and case studies help explain complex concepts about network effects and critical mass. Liked: - Clear explanations of platform business models - Mix of historical and modern company examples - Practical frameworks for platform pricing and growth - Accessibility for non-economists Disliked: - Some repetition of concepts and examples - Later chapters become more technical - Focus mainly on US companies - Limited coverage of newer platforms Ratings: Goodreads: 4.1/5 (245 ratings) Amazon: 4.4/5 (89 ratings) Notable reader comments: "Explains complex economics without getting bogged down in jargon" - Amazon reviewer "Good primer but could be more concise" - Goodreads review "More relevant for established businesses than startups" - Goodreads review "Best book on platform strategy since Platform Revolution" - Amazon reviewer

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🔹 David S. Evans has served as an economic advisor to some of the world's largest multi-sided platforms, including Microsoft, Visa, and Tencent. 🔹 The concept of multi-sided platforms dates back to ancient bazaars and marketplaces, where merchants acted as intermediaries between buyers and sellers, though the term wasn't coined until the digital age. 🔹 The book explains how companies like OpenTable solved the "chicken-and-egg" problem by initially paying restaurants to join their platform, before becoming profitable enough to charge them instead. 🔹 Matchmakers typically generate about 70% of their revenue from one side of their platform while subsidizing the other side to maintain balance and growth. 🔹 The manuscript underwent extensive revision after Uber's dramatic rise, as the company became one of the most significant examples of modern matchmaking platforms during the book's development.