Market Failure - What Is the Exercise of Building a Market?

A few months ago, Professor Scott Kominers and Cliff Maxwell, former Chief of Staff to Clayton Christensen and an HBS alumnus, co-authored an HBR article entitled, What Makes An Online Marketplace Disruptive?  They pointed out that rather than digitize or make existing transactions more efficient, truly disruptive marketplaces create entirely new transactions, engaging non-consumers and/or non-producers.  In this episode, Scott joins Cliff to discuss a number of topics relevant to online marketplace disruption, including sources of market failure; entrepreneurial opportunities for marketplace design; trust as an enabler of market participation; the disruptive potential of platforms enabled by Web3 and blockchain technologies; market design as a tool for addressing inequality; and much more!  They draw on examples such as the experience of buying a used car, Airbnb’s disruptive business model, and the market for high-end art.  This is a must-listen conversation for those curious about marketplace design; what disruption in marketplaces looks like; and how entrepreneurs, investors, and others can spot future marketplace opportunities!