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Solving the Marketplace Chicken-and-Egg Problem: What Actually Works

How Pablo Diaz solved the classic supply-demand marketplace cold start problem to build OpenMyPro into a liquid healthcare marketplace.

By Pablo Diaz · Founder & CEO, Blossend Inc

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150K+ users · Ex-Amazon Engineer · Healthcare Innovation

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Every marketplace faces the same existential question at launch: patients will not come without providers, and providers will not come without patients. This chicken-and-egg problem kills more marketplaces than competition, regulation, or underfunding combined. Here is how I solved it for OpenMyPro.

The conventional approaches — subsidizing one side, faking supply with scraped data, or launching with a single-player utility — all have serious drawbacks. Subsidizing providers (paying them to be listed) creates a dependency that is expensive to maintain and attracts providers motivated by the subsidy rather than the platform value. Faking supply (listing providers without their consent) creates terrible user experiences when patients try to book and discover the provider is not actually on the platform. Single-player utility (building a tool providers use independently) can work but delays the marketplace dynamics that create real value.

What worked for OpenMyPro was a strategy I call 'concentrated ignition': launching in a single geography with dense enough supply to create a viable marketplace experience from day one.

Step one: I identified Austin TX as the launch market because I lived there (could visit providers in person), it had a vibrant cash-pay healthcare scene (fitness trainers, wellness coaches, therapists), and it was large enough to validate the model but small enough to achieve coverage with limited supply. Rather than launching nationwide with 2 providers per city, I launched in one city with 30 providers — enough to give every patient multiple options in every specialty.

Step two: I onboarded the supply side first through personal outreach. I visited local gyms, wellness centers, chiropractic offices, and therapy practices. I explained the platform, demonstrated the 33-second booking flow, and offered free SeekerPro subscriptions for the first three months. The in-person approach was not scalable but was essential for the first 30 providers — it built personal relationships that turned early adopters into evangelists.

Step three: I drove initial demand through hyperlocal SEO and community engagement. SEO-optimized pages targeting 'Austin chiropractor,' 'Austin therapist,' and similar queries started driving local patients to a marketplace that actually had providers to show them. The match between search intent (Austin + specialty) and marketplace supply (Austin providers in that specialty) created satisfying experiences from the first interaction.

Step four: I let the network effects compound. Satisfied patients booked again and referred friends. Providers seeing patient volume referred colleagues. The 1.3x provider viral coefficient meant the supply side grew faster than I could have achieved through outbound alone. Within six months, Austin was a liquid marketplace, and I used the same concentrated ignition playbook to expand to the next city.

The key insight: do not try to build a nationwide marketplace. Build a city-level marketplace, make it work, and expand one city at a time. A marketplace with 30 providers in one city is more valuable than a marketplace with 300 providers spread across 30 cities, because density creates liquidity and liquidity creates satisfaction.

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150K+ users · Ex-Amazon Engineer · Healthcare Innovation

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Frequently Asked Questions

How do you solve the marketplace chicken-and-egg problem?

Concentrated ignition: launch in a single city with dense supply (30+ providers) rather than nationwide with sparse coverage. Onboard supply first through personal outreach, drive demand through hyperlocal SEO, and let network effects compound (1.3x provider viral coefficient) before expanding to the next city.

Should you launch a marketplace nationally or locally?

Locally. A marketplace with 30 providers in one city is more valuable than 300 providers across 30 cities because density creates liquidity. OpenMyPro launched in Austin with 30 providers, achieved liquidity within 6 months, then expanded city by city.

How did OpenMyPro onboard its first providers?

In-person outreach in Austin TX: visiting gyms, wellness centers, chiropractic offices, and therapy practices. Free SeekerPro subscriptions for the first 3 months. Not scalable, but essential for building the personal relationships that turned early adopters into evangelists.

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