This article is based on the book Platform Scale, written by Sangeet Paul Choudary. Platform Scale is available for free download for a limited period between October 5th and October 9th. To access additional bonus content, check the book website here. The on-demand economy is bringing together technology and freelance workers, to deliver us services in exciting new ways. We are increasingly...
Are you building a marketplace, social network or a platform? Do you ever describe what you’re doing as the Uber for X, Airbnb for Y or the Twitter for Z?1 Do you want to understand why certain startups scale and others fail?1 Over the last few years, I’ve been obsessed with platform business models and their ability to scale. Unlike traditional enterprises, platforms do not scale by scaling...
This article was originally published on Sangeet Paul Choudary’s personal blog Platform Thinking – A blog about building early stage ventures from an idea to a business, and mitigating execution risk. A keynote laying out the shift that platforms are bringing about in the nature of business today. One of the central concepts I talk about on this blog is the shift from linear business models to...
One of the most common questions I get asked, while talking about platforms, relates to the issue of labor on platforms. Facebook and Twitter, among others, get a lot of value from their users and make billions of dollars, but the users don’t see much kickback. The economics of free-labor platforms Social networks like Facebook and Twitter leverage free labor from a global talent pool to...
How does one find new startup ideas? Every business is built around solving a customer pain. Solving a customer pain creates value which in turn, if successfully harnessed, can be monetized. Platforms, in particular, connect demand and supply to solve customer pain on both sides. Platform Thinking And Startup Ideas One of the patterns for new startup ideas, that I often see in platforms, is the...
Welcome to the age of the zero-dollar marketing startup. WhatsApp, and earlier Instagram, have officially become a permanent part of startup lore for having built multi-billion dollar businesses without (reportedly) spending a dime on marketing. Meanwhile, Airbnb has grown from a hipster community of mattress-renters to the world’s largest provider of accommodations without spending even a...
You become what you measure. From my experience working with clients across enterprises and startups, the most common reason for failure and inefficiency is the focus on convenient, but inappropriate, metrics. Your technology doesn’t determine the business you build. Neither does your organizational capability. The metric you optimize for is the single biggest factor that determines which...
What does the traditional world of manufacturing have in common with the way networked platforms work? How can a basic understanding of factory design help us change the way we think about designing internet platforms, marketplaces and social networks? I’ve written previously about the distinction between pipes and platforms. If you haven’t already read it, you must definitely check it out. It...
Startups need Traction. A startup which doesn’t get discovered doesn’t go anywhere. This is all the more critical for platform businesses which rely on their users to create value and network effects. In the specific case of platform businesses, Traction dictates the value that is created. A social network without enough users or a marketplace without enough activity isn’t going anywhere...
Marketplaces are difficult businesses to get off the ground. A marketplace without buyers cannot attract sellers and vice versa. In fact, the infamy of this proverbial chicken and egg problem detracts entrepreneurs from the challenges that a marketplace presents after it has successfully gained adoption and is successfully matching buyers with sellers. After all, marketplaces for products, like...
