Let's start off with what market networks are. From this article, there are several key points and relationships that we can establish. Below are several highlighted passages and how they are critical to Gitcoin:
"Market networks use SaaS workflow software to focus action around longer-term projects, not just a quick transaction."
This essentially is Gitcoin, as we've definitely extended past the transactional relationship of a bounty, and more into relationships centered around communities and projects, which inherently are more collaborative.
"[Within market networks, the] many-to-many transaction pattern is key, n-sided marketplaces [are] where people come with transacting in mind."
Gitcoin is a network but also a SaaS tool. We provide value on critical tasks for both sides of the market. We also inherently connect inter and intra sides of the market network.
"The highest value services - like event planning and home remodels - are neither simple nor objectively judged."
This also applies to abstract things like software engineering projects. Gitcoin.
Market networks are also unique from a monetization standpoint. They combine the strong network effects defensibility and scalability of direct networks like LinkedIn or Facebook together with the lucrative revenue models of SaaS or marketplace businesses.
An example will help: let's go back to HoneyBook, a market network for the events industry. An event planner builds a profile on HoneyBook.com. That profile serves as his professional home on the Web. He uses the HoneyBook SaaS workflow to send self-branded proposals to clients and sign contracts digitally. He then connects the other professionals he works with like florists and photographers to that project. They also get profiles on HoneyBook and everyone can team up to service a client, send each other proposals, sign contracts and get paid by everyone else.
This goes back to that analysis about the unit of engagement that we're basing the edges of the network from. Mapping it first to contributors and the value that they receive from Gitcoin looks something like this:
In the early days, we were thinking more from a Bounties + Grants standpoint, where contributors enter the flow from the Bounties side, and we eventually capture them and convert them to maintainers. With our current business model, the high flow entry into Gitcoin is Hackathons. If we really break it down, it's the profile data that we receive from users that contributes to the network, but we still have to solve the problems of contributors. In the above graph, the project is what provides the context for the services that we provide. Of course, it is possible to find work and projects on our platform (e.g via Hackathons), but once a developer has that kind of project direction, this is where Gitcoin shines.
As an example, the flow above tell us that a contributor joins the network with a project, either of their own volition, or from a Hackathon. That project is then the basis of finding funding in Grants, mentorship from a Tribe, or help from targeted communities like Kernel and Apollo.
We can't forget the funder/maintainer side of the market as well, and if we map it similarly to what funders come here to find, it oddly looks more like a mature version of a contributor's goals. Contributors come with interesting projects they want to collaborate on or find, funders come with mature projects that are essentially, organizations. So really, it's a two-sided marketplace but one side of the marketplace converts nicely into the other, and in the end, it really all just feeds into the strength of the network.
To summarize this qualitative analysis of market networks:
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It will be a complex network. As witnessed in the flowcharts above, it's not a simple organism. Everything feeds into everything else, but there are places where the "current" gets stronger. These are the product leverage points that we must get right.
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Collaboration tends to happen around a unit of engagement, which in this case, I'm defining as a project. This helps us better answer the question, "what the hell do I do when I come to Gitcoin?" Start with a project, because if you can start with a project, you can work on it with targeted communities (Kernel/Apollo), get feedback (Hackathons, maybe), get mentorship (Tribes), get funding (Grants), or find teammates on Gitcoin (profile). Anchoring off of a project narrows the action pool, where contributors bring something interesting, and in return, we have an entire tool suite for them to make their project the bomb-diggity. Enabling the ability to create an open project can also be seen as a step in the right direction for breaking into the web2.0 market.
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The quality of the people matter. This means projects, developers, mature projects (organizations), and funders.
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Long-term relationships matter. These are the edges in the network graphs above. There are transactions between human and Saas product, and human to human. The former generates revenue, but the latter generates multiplied growth with our network.
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Unique profiles and profile data is a very important part of this. The information that we collect from this front will be a multiplier to anything that we do within our network. That being said, something like user directory is a tool to access unique profiles, but more importantly, we must collect the right information within our products and and our onboarding to maximize the user directory.
Before we get to the hypotheses of this particular epic, how have hackathon project cohorts fared in terms of long and short term retention? Do contributors who open a project within a hackathon find it easier to engage on Gitcoin? Let us compare several cohorts:
Opening a project on a hackathon results in a 100% increase (doubling) of retention 8 months to 12 months after joining Gitcoin (green), as compared to multiple avenues of verification (participating in hacks, being active on our platform, accumulating actions), in the blue. In the earlier weeks, our traditional definition of user verification offers double the retention rate, but those who create projects tend to retain heavily long term, overtaking our traditional definition of verification. This is a good trend.
An analysis result like this isn't a causal relationship, so a strong recommendation to structure our product completely around projects may be heavy handed. However, it is a start to suggest that projects could be the glue that helps compress our product suite together.
Let's take this analysis one step further, and check out what happens at the "project demarcation line" - the point at which a user creates a project, and everything that happens after it:
After the creation of a project, retention starts off around 70%, but does NOT precipitously drop in the first 4-5 weeks to < 50% to the "asymptote" that we most commonly see with retention curves. Thus, retention remains strong even in the later weeks. As time progresses, you can see that the curve is much flatter, meaning there's definitely more engagement week over week post project creation, and drop off, while still possible, occurs at a far lower rate than normal. This adds evidence to suggest that project cohorts are simply more active and retain better, and could suggest that opening a project decreases the time to value on Gitcoin's product suite.