1. Define the large market.

2. Focus entirely on one small niche within that large market that will give you enough credibility to win over the late majority in the latter. See facebook [harvard college social], myspace [music], bebo [birthday reminders], craigslist [local events in san fran] etc.

3. Own > 90% of your niche

4. Cross the chasm into the large market. The market adoption curve demographics of the large market should ideally match the niche you chose.

BTW it is unlikely that a "tech" audience are a good niche to pick, as they do not contain many peers for the larger market to identify with. It will be interesting to look at twitter in a few years to see if it crosses the chasm into the mainstream user.

I'd say read the book. It's a classic.

Craig clearly and explicitly treats Craigslist like a nonprofit, so he's leaving a lot of value "on the table" that he isn't extracting. I'd say this value goes to Craigslist users. If you use both eBay and Craigslist a lot, and I do, you can feel the difference pretty strongly...

On a side note, Craigslist is hardly successful outside of the US. Even in London it's got no traction.

http://www.squeezedbooks.com/book/show/7/information-rules-a...

Basically, there are what are called "positive network externalities" or "network effects" for a site like craigslist: if you you want to sell something, you want to go where lots of buyers are. If you want to buy stuff, you'll get a better selection where there are lots of sellers.

These things can be a factor, but are not an explanation.

One way you could beat Craigslist: Start in one local region and build a hell of a community around it. Maybe have parties or events. Get everyone in the city talking about it, and own that city. Make it so that everyone in that city chooses the new local competitor over Craigslist.

Another: Find one thing Craigslist is doing really poorly, and do that really, really well. Focus only on that and branch out from there.

If you want to fight an empire, you don't march out the same sets of troops as them into the plains to fight. You go find a tiny, isolated, already unhappy part of their empire, and you raise hell there. Build support for the cause. Get more troops, supplies, allies, experience. Realistically speaking, there won't be a "craigslist killer" that comes out of nowhere with better classifieds unless it's backed by someone that already runs things. Someone like Google might be able to do it by making a push on sites that people already use a lot, similar to the way they're pushing Chrome right now. But if you're starting from scratch?

Then think small. What or where is Craigslist failing? Go there. Take over that place. Then branch out.

It's not just enough to say "we have a better search engine than google" if you want to dethrone google, you actually have to be better (although the former may get you funding). Witness Cuil. Or Live -- who tried to pay people to use their search engine: even the lure of easy money isn't enough to get people to switch. With places like craigslist and ebay, the first mover advantage is significant. These sites bring two parties together. Those who have something to sell and those who have something to buy. The sellers want to be where the buyers are and the buyers will go where the sellers are.

It is possible to have a successful business as a small time competitor to an established, entrenched player, but if your goal is to be competitive, you've got a long uphill battle ahead of you. It may be wiser to redefine the industry or look at it from another angle, then tackle that. What does craigslist do really bad that could be better? Is the lack of a competitor that eases that pain the reason why people still use the incumbent?

I'm not sure what craigslist's weak points are. The site is extremely minimal, search works reasonably well, people automatically sort most things into the right places (because otherwise they'd be wasting their time), the majority of posters don't need to pay, fraud is managed well enough that people are not looking for something else. I can't think of any weak points -- which may be why I'm not working on craigslist competitor.

Craigslist is good for some things but it has a lot of trash posts. Sometimes I get lucky and someone happens to have what I want but it's easy to get bogged down by all the junk. These days if I don't find what I'm interested in there very quickly I go to someplace with a better signal/noise ratio. I wouldn't compete directly with them unless I had a way to improve that.

I mean, you spelled it out right there: if you don't find what you want on craigslist _first_, then you go someplace else. craigslist apparently has enough value, and it's easy enough to determine if you're going to get any value out of any one visit, that you don't bother going someplace else _first_. It is not a last resort visit, the craiglist competitor sites are the last resorts.

So it's the same answer again: craigslist is where majority of the users are.

http://www.angieslist.com/Angieslist/

would make for a better experience for buyers of services. But maybe that isn't the main business model of Craigslist anyway, so maybe Craigslist is happy enough with the status quo.

I suspect:

* Buying pets is not a killer app for craigslist-like sites

* The fancier design is a net negative

craigslist has a pretty good lock on what craigslist does -- they don't charge users for much, have the userbase, have a simple UI.

Kijiji is very competitive with craigslist in several countries.

Canada: http://www.alexa.com/site/ds/top_sites?cc=CA&ts_mode=cou... http://siteanalytics.compete.com/kijiji.ca+craigslist.ca/?me...

Germany: http://www.alexa.com/site/ds/top_sites?cc=DE&ts_mode=cou... http://siteanalytics.compete.com/kijiji.de+craigslist.de/?me...

The basic problem in this area is reach, but that's not a problem or ebay so asking why kijiji fails is not going to answer your questions for a startup.Different situation different problems.

I prefer this over posting on a job board, as it's quicker and some other things too!

One pattern that you could apply to break craigslist would be focus: http://ycombinator.com/munger.html [Search for 'travel magazine'].

You'd want to pick a suitable niche within craigslist and service that like crazy. Then move on to others.

Of course, Craigslist isn't nearly as big in other countries - In the UK gumtree is the winner, and in Norway finn.no is the place to go for classifieds.

2) Layout. Craigslist is beautifully simple. Kijiji looks like "web 2.0".

For some reason it has taken off in Toronto though.

Did you talk to craigslist users and see what they wanted changed? Is allowing sales of pets a deal breaker?