Field notes
Every marketplace has a first transaction. Here is ours.
By Ross Day2 min read
Every marketplace has a first transaction. Ours happened on a Friday at 1:33 PM.
The first job
A homeowner in Great Falls, VA posted a tree removal on GivingStump. Eleven days later a local tree service won it with a $1,200 bid. Nine seconds after the homeowner accepted, the money was sitting in escrow.
That is the whole loop. GivingStump is the contractor-first marketplace we built for tree work in the DC metro. Homeowners post a job with photos, and licensed crews bid on it. When the homeowner accepts a bid, the payment goes into escrow. It is released the minute the homeowner confirms the work is done. How we built it is in the GivingStump case study.
Escrow protects both sides. The homeowner's money is committed when they accept, so the crew knows the job is real. The crew is paid when the homeowner confirms, so the homeowner knows the work is finished before the money moves.
The economics
The economics are the part I care about. The crew keeps $1,140. We took $60. Sixty dollars is 5 percent of the winning bid.
Every incumbent in home services charges contractors for leads. Money out the door before anyone has won anything, for a phone number that four competitors also bought. We charge 5%, only when a contractor wins the job, and the homeowner pays nothing.
At the 20 to 30 percent some platforms take instead, the same $1,200 job would have cost the crew $240 to $360.
Lead fees put the risk on the contractor. A 5% fee on a won job puts it on us. We only get paid when the crew does.
That model only works if the marketplace actually clears. On that Friday, it cleared.
When the work was done
The homeowner confirmed the work looked good, and the money went to the crew's bank the same minute. No lead fees. The crew paid 5 percent, and only because they won.
The first 50 contractors lock the 5% rate for three years. If you run a tree crew in the DC metro, the founding spots are at givingstump.com.