Craigslist as Social Entrepreneurship

Although the annual revenue of Craigslist.org is estimated to be anywhere from the tens of millions to the hundreds of millions, could we consider the company as primarily a social enterprise?

Like most (some would argue all) innovations, Craiglist was not new when it was introduced in its more current form in the late 1990s. The site improved on an already familiar service: newspaper classified ads. Craigslist’s minimal interace looks and feels exactly like what you would expect from putting classified ads online. The company is unique among it’s internet peers for barely changing the look of the site since those early days more than a decade ago. Why would Craigslist avoid such a common practice? Even the features of the service have barely changed. The focus is on functionality and content, rather than style and sales. To be beneficial to the greatest number of people, the site had to be as easy as using its physical newspaper counterpart. It probably ended up being even simpler.

This digital innovation, actually did little to change the structure of classified ads. Everything is based around location. There are categories. Everything is minimal. Short and simple. One revolutionary feature was the addition of pictures for free. This is especially beneficial for those who are buying or selling things on the site. This one simple variation alone makes the newspaper classified obsolete.

In addition to the easy of use, the service needed to be accessable. Of course, the site is free to use for virtually everyone. The company does charge to post jobs in some major cities. But outside of job postings, the company has never charged customers to post or reply to ads. They have also avoided many of the marketing structures that have been used by other technology firms, like pro accounts, in-app purchases, and other types of subscriptions. Being free provides that key element for social change: access.

I would imagine that any person reading this has either used Craigslist or knows someone who has. I used the site to sell a bed, furnish a new apartment, and buy a kayak. “Did you buy it on Craigslist?” “I bought it on Craigslist.” But I didn’t actually buy anything on Craigslist. Unlike Amazon, eBay, or Buy.com, no money is exchanged through the site. It simply connects people who have complimentary needs and wants. Newspaper classifieds were doing this already, but Craigslist does it on a massive scale. It made this service accessible to anyone with an Internet connection. That accessibility is central to social change. One of the premier examples of a social entrepreneur is Muhammad Yunus, who began offering extremely small loans to very poor individuals in the developing world in order to start a small business. This practice of microcredit or microfinance earned him a the Nobel Peace Prize in 2006. This novel system gives certain people access to opportunities that were never open to them before. Has Craigslist transformed lives in this way? Probably not. But haven’t millions of people benefited from this free service?

Unfortunately there have been controversies over the years related to crime, prostitution and even murder connected with the use of Craigslist. Newspaper classifieds were also open to abuse, but greater access creates greater risk as well. Despite the controversies, the service has created immense social value in addition to their financial success. More people in more places than ever before can find…well, anything. Whether or not social entrepreneurial goals were a part of their original thinking, I do not know. But the success of such a simple idea to benefit society is an amazing accident to have.

Plus, it’s free with no ads! Unless, of course, you count the ads that comprise the entire site.

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