Do sellers we onboard stick around and keep transacting?
№ 045 · Net active suppliers cohort
Definition
MetricNet active suppliers: onboarded sellers still transacting at month N, netting churn against reactivation
Unitcount and % of onboarded cohort active at month N
Triangular grid of % of seller cohort still actively selling per month-since-onboarding. Climbing color toward newer cohorts means better onboarding. Build by counting sellers with at least one transaction per month per cohort. Example: Oct 25 cohort 78% active M0 to 36% M5; Mar 26 cohort 100% active M0.
Benchmarks
| Bottom 30% | Median | Top 30% |
|---|---|---|
| net active supplier count flat while gross onboarding grows, meaning the funnel is refilling a leaking base; or active defined as listed rather than transacted to flatter the trend | 50-70% supplier retention among funded consumer marketplaces (a16z observed range); a large share of gross adds never reaching a first transaction is the modal failure | 60-70%+ of onboarded suppliers still transacting at extended tenure, with the active base compounding because reactivations plus retention outrun churn |
consumer marketplaces seed through Series B (a16z 2020-2022), active defined as transacting in the period; power-law weighting from Marketplace Pulse implies the GMV-weighted version of this chart is the one that pays · Same evidence base as seller cohort retention; the distinct read here is the net line: gross adds minus churn plus reactivations. Public marketplaces report active seller counts but not cohort survival, so cohort-level ranges rest on the a16z dataset. Count-based and GMV-based versions can diverge sharply under power-law supply.
Category split omitted: No two independent Tier 1-2 sources publish supplier cohort survival by category.
When it looks bad
Gross onboarding bars grow quarter after quarter while the net active line stays flat, and the cohort table shows most attrition happening before the first sale; reactivation contributes nothing.
1,200 sellers onboarded in a quarter, net actives up 90; 58% of the cohort never completed a sale; m6 cohort survival 33% and falling cohort over cohort.
What to do about it
- Gate onboarding volume on activation capacity: measure sellers-to-first-sale within 30 days as the funnel's binding KPI, and stop paying supply-acquisition bounties on signups, paying on first sale instead.
- Guarantee early liquidity for new sellers: boosted placement in week one, house-demand seeding for empty categories, and a rescue queue for listings unsold at day 21; a16z ties survival directly to time-to-first-sale and perceived price fairness.
- Run reactivation as a program, not an accident: win back lapsed sellers with demand evidence (searches and price signals for their past inventory) and count reactivations as an explicit line in the net bridge.
- Report the cohort table GMV-weighted beside count-weighted; protect the head cohort with dedicated account coverage since power-law supply means a few survivors carry the base.
Sources
- Andreessen Horowitz (Olivia Moore) 50-70% of suppliers retain in best-in-class cases and expand GMV 2-3x; first-sale experience determines survival a16z.com ↗
- Marketplace Pulse active-seller definition benchmark: approx 500,000 US Amazon sellers counted as active on at least one feedback in a year; head cohort carries half of GMV marketplacepulse.com ↗
- Marketplace Pulse power law means net supplier count and net supplier GMV tell different stories; both required marketplacepulse.com ↗
- Casey Winters and Lenny Rachitsky supply-side retention typically the stronger side and a precondition for viable demand economics caseyaccidental.com ↗
- Everything Marketplaces (Marketplace Capital) supplier switching costs and category structure fix the ceiling on supplier survival; benchmark within category everythingmarketplaces.com ↗