Rothman joined eBay early and led U.S. operations, helping attract nearly 200 million people to the auction site. He was also a founder of eBay Motors. He joined Greylock as an entrepreneur-in-residence in 2011 and today announced a promotion to partner.
Marketplaces are playing an increasingly significant role on consumer Internet. Companies like eBay pioneered this sector years ago, but a lot of innovation is happening right now, largely driven by mobile technology. The past few years have seen the meteoric rise of companies like Airbnb (which is now valued at $1 billion), TaskRabbit, LendingClub, Lyft, Etsy, and scores of others that connect people to transact online.
Rothman told Reuters in an interview that marketplaces have the potential to create more billion-dollar business in the next five years than in the last 20 because they scale well. There is no inventory to manage and the business is self-serving.
“When they get bigger, they get stronger,” he said.
But two-sided marketplaces can be difficult to get off the ground. Entrepreneurs often face the chicken-and-egg problem of attracting a critical mass of buyers and sellers that adds value to both sides. Once achieved, however, the “network effect” comes into play, where both sides grow quickly. Mobile penetration has fueled marketplace growth because people can buy and sell any time, anywhere.
The $100 million is not new money; it comes from existing funds and covers companies at all stages of their lifecycle. Current marketplace investments include Airbnb and Rothman is an adviser at Wanelo, Poshmark, and Lyft. Greylock has also made notable network investments include Facebook, LinkedIn, Nextdoor, Path, and Tumblr. The firm has had success with building online networks, to put it lightly. Now this expertise and a hefty chunk of change will be funneled towards building the next generation of marketplaces.
Earlier this summer, Greylock promoted principal Josh Elman to partner. Elman previously worked as product manager at Twitter, Facebook, and LinkedIn and focuses on consumer tech. Greylock was founded in 1965 and has $2 billion under management.
Greylock Partners is one of the oldest venture capital firms, founded in 1965, with committed capital of over $2 billion under management. The firm focuses on early stage companies in the co... All Greylock Partners news »