How did gross merchandise value change and where did the movement come from?
№ 029 · GMV waterfall
Definition
MetricGross merchandise value growth, decomposed into new, retained, expanded, resurrected and churned GMV
Unit% change period over period, decomposed in currency
Period start GMV, plus new buyers and repeat purchases, minus churned buyers, ends at period GMV. Repeat-buyer bar size versus new-buyer bar shows marketplace maturity (a healthy marketplace shouldn't be 100% new). Build from order data classified by buyer cohort age. Example: $42M start, +$8.4M new, +$5.2M repeat, -$3.8M churned = $51.8M.
- GMV
- Gross merchandise value. Total value of goods sold through the platform before returns, discounts and take rate.
Benchmarks
| Bottom 30% | Median | Top 30% |
|---|---|---|
| under 20% YoY at venture stage, or growth where the new-GMV bar fully offsets a shrinking retained-GMV bar | roughly 30-70% YoY for venture-stage consumer marketplaces; public SEA on-demand comps printed 20-24% YoY in 2025 | 70%+ YoY GMV growth at Series A to B scale; 25-35%+ YoY at multi-billion GMV scale, with most of the bridge coming from retained and expanded cohorts |
consumer marketplaces, seed to public scale, 2022-2026 data; venture-stage figures from fund deal-flow benchmarks, public-scale figures from Grab 2025 disclosures · No large-sample dataset publishes GMV waterfalls directly; growth benchmarks are assembled from investor surveys and public filings. Waterfall composition norms (share of growth from retained cohorts) come from the a16z GMV retention framework rather than a survey. Early-stage MoM growth percentages are unreliable at small denominators per the Lenny investor survey.
Category split omitted: No two independent Tier 1-2 sources publish GMV growth splits by marketplace category at comparable stage definitions.
When it looks bad
The new-GMV bar grows every period while the retained bar shrinks faster, so total GMV inches up on an ever-larger acquisition spend and the churned-GMV bar widens each quarter.
GMV moves from $10.0M to $10.4M in a quarter, but the bridge is +$2.1M new, -$1.5M churned, -$0.2M contraction; 100%+ of net growth is bought.
What to do about it
- Rebuild the waterfall from cohort data before acting; if churned GMV exceeds 30% of new GMV, shift budget from acquisition to resurrection campaigns aimed at lapsed buyers with prior 2+ transactions, the cheapest GMV bar to move.
- Attack expansion GMV through cross-category merchandising to retained buyers; a16z documents best marketplaces growing retained cohorts to 100%+ GMV retention through frequency and basket expansion rather than new-user volume.
- Reprice promo-led new GMV: cap first-order incentives at the level where the cohort's m3 retained GMV still covers the subsidy, and report subsidized vs organic new GMV as separate bars.
- Move the review cadence from blended GMV growth to bookings growth plus AOV, per the Lenny framework, so price increases cannot mask declining transaction counts.
Sources
- Lenny's Newsletter two dozen investors: good and great growth rates by stage; early MoM growth is noisy, annualized growth becomes the meaningful bar past approx $1M revenue lennysnewsletter.com ↗
- Everything Marketplaces (Marketplace Capital) Series A marketplace bar: $1.5-5M+ monthly GMV, 70%+ YoY revenue growth, down from 2021 peaks everythingmarketplaces.com ↗
- Grab Holdings public SEA scale reference: FY2025 Deliveries GMV +21% YoY, Q4 Mobility GMV +20% YoY s205.q4cdn.com ↗
- Andreessen Horowitz (Olivia Moore) high GMV retention means existing cohorts fund more of the growth target, requiring fewer new users; the waterfall should not be all new-GMV a16z.com ↗
- Andreessen Horowitz GMV is the headline volume metric but must be read with take rate and cohort quality; concentration and retention determine durability a16z.com ↗
- Lenny's Newsletter bookings growth is the cleanest growth read because GMV mixes in AOV and pricing changes; track both lennysnewsletter.com ↗