The only times I've ever heard of this working are when you have a huge war-chest to subsidize both sides of the marketplace to come out and play on your app. If you can offer better prices than normal to both sides (with the gap made up from your raises) it can work. Otherwise? I'm not sure it can.

Yeah it turns out those are hard to go to market with, who would have thought

Only way it can work is if you can bootstrap something hyperlocal to start with (think Uber in San Fran)