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We're sharing a guest blog post from Matt Bendett, where he shares some of his key learnings & lessons from marketplace expansion at Peerspace during their expansion into 40+ markets (both domestic & international). This was previously shared as a post in the community here.
Hey all, I shared this in a reply to Danny's post, but Mike and I thought it would be helpful to share here as a post so it doesn't get lost in the replies. I've been fortunate to lead Peerspace's expansion into 40+ markets domestically (US) and internationally (CA, UK, FR, DE, ES, AU). While we iterated and ultimately established network effects across several regions, our success didn't come without hard learnings over the years. With the right foresight, you can mitigate these common pitfalls.
You could go so incredibly deep with this that it would talk most founders out of expansion in the first place! However, with the right foresight, you can mitigate common pitfalls. These are ones that I’ve grappled with when expanding to new markets:
It’s tempting to justify expansion with aggressive forecasts, particularly when you’ve established product-market fit (PMF) and solid unit economics in your home market. However, if you haven’t fully optimized your initial market, expanding can lead to more challenges than growth. When forecasting for a new market, temper your expectations. Apply a conservative reduction (in the range of 30-50%) to account for unknowns like slow user acquisition, lower purchasing power, or misalignment between your brand and the local audience. Simultaneously, carefully model your OpEx from headcount to SaaS licenses and marketing costs. A conservative P&L forecast will provide a more realistic foundation for investment decisions and help you avoid organizational strain down the road.
Tied closely to your P&L, expansion is often de-risked by assumptions about operational efficiency and rapid time to payback. Teams frequently underestimate the time it takes to operationalize a new market and overestimate the speed of organic growth. Small deviations in your forecast can compound over time, leading to significant delays in profitability. Be prepared to pivot your strategies if early indicators suggest you won’t hit your original goals. The ability to course-correct or exit underperforming markets quickly will be key to protecting broader business health.
Assuming you are leveraging centralized or off-shore help in certain areas of your market launch, you will have some critical hires to make in local geos where geographic, cultural, and language expertise are critical for success. Allow ample time for recruiting and onboarding local talent, and be prepared for notice periods and hiring surprises that can slow momentum.
Launching multiple markets at once may seem like an attractive path to scale, but doing so often dilutes focus and increases operational complexity. Make sure you have enough people available to build and engage your early supply in authentic ways. Coordinate with your marketing and product teams with plenty of lead time to make sure you have a go-to-market process in place with agreed upon resources you will need from them. Miscommunication or unclear expectations can lead to delays, missed goals, or inconsistency in brand messaging. Regular cross-functional meetings and alignment on KPIs, timelines, and responsibilities are essential to avoid operational silos.
Each new market introduces a unique set of challenges, and what worked in one market will not necessarily work in another. The strategies that helped you establish PMF may not scale universally—whether it’s your paid marketing ROAS, supply-side onboarding, or SEO effectiveness. As others have called out, past performance does not guarantee future results. Stay flexible and have strategic thinkers on hand to navigate the inevitable hurdles that arise in unfamiliar territory.
This should require no explanation, but make sure you really understand your local competitors, their value props, and how they resonate with customers of different segments you’ll want to attract. You’ll need to understand your differentiator and lean into it, whether you are bringing the firepower of a larger org/brand, your unique product approach, or to show sensitivity to the way things operate differently at the local level.
People typically choose expansion because its a seemingly straightforward way to expand your addressable market potential. It sounds appealing and you have some playbook at the ready to repeat, but their are many complexities that lie beneath the surface. It’s worth standing this strategy up against other options such as expanding market-share within your primary audience (i.e. going “upmarket”) or monetizing their already captured audience in new ways (i.e. offering a premium subscription). Assess these opportunities alongside where your product, team, and cash resources stand.
Finally, it’s worth asking yourself if you’d rather seed markets and grow slowly and responsibly, or apply a winner-take-all mentality. I think the latter approach remains most desirable from a growth standpoint, but the chaos and economic uncertainty it brings can derail a company. The former approach seems to have some benefits as long as you are reasonable with expectations and able to effectively nurture and prioritize the healthiest markets for the long-haul.
Hope this helps and happy to chat through it in the replies.
You can connect with Matt to discuss this post in the Everything Marketplaces community here. A big thanks to Matt for also being active in the community, where he is often sharing his marketplace experience, insights, and helping early stage founders.
