Lessons for Product Managers from Trading — Startup Analytics

Think In Terms of Probability

Every single trader whether that’s capital markets aka stocks, funds etc or exotic instruments such as sports betting, poker etc. A successful trader takes bets with the positive payoff and capped downside risk.

Auction Design

CRED had this interesting public spending game where if you finish among the top 50 or 25 leaderboards in terms of spend within a time window. You get to win certain prices such as Air Pods. From what I understand, they have since managed to launch multiple such games with prizes for maximum spending.

Specific Details

With just minimal marketing spend of ~20K*50 which translates to Rs 10L, if CRED can drive incremental spending across a good chunk of users. This might be a cheaper way to drive engagement and spending among existing users compared to other means of marketing such as ads, discounts etc.

Order Management

Another very interesting concept is to bring liquidity and manage priorities when running an exchange to match buyers and sellers. A stock exchange is a place to match buyers and sellers with an orderbook consisting of bids and asks.

  • Market Order: This allows you to sell at any price. The key is the speed of execution. It can be buying or selling. We might not get the price, but we will be able to get the quantity we need to buy or sell.
  • Limit Order: Here, price is the key. Use this order, when you don’t wanna optimise for speed but for price. The order might never even get full filled if the price is too far off from the existing ones.

Specific Cases

At the current stage, the priorities likely were market share and growing the size of the market places. This meant all decision making was made purely from a marketing point of view. This also meant funding and carrying out trades or order full fills which were negative pay off for the companies. This is well understood across the firms and the consumers as well.

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