Network Effects Map

Flashcards covering the types of network effects.

Network Effects Map

A tool for founders to dissect and navigate different network effects and defense abilities as they build their companies.

Four Core Defense Abilities in the Digital Age

Network effects, embedding, scale, and brand.

Direct Network Effects

Each new user adds value to every other user. Examples include Comcast, AT&T, Bitcoin, Ethernet, fax, Facebook Messenger, and WhatsApp.

Market Networks

People are adding value to each other for the purpose of transactions. Examples include HoneyBook and AngelList.

Two-Sided Marketplace

Simple two-sided marketplaces, such as eBay or Craigslist.

Two-Sided Platform Network Effects

Operating systems like Microsoft OS or iOS.

Two-Sided Asymptotic Marketplace

Marketplaces where the value doesn't grow as much over time, such as Uber or Lyft.

Tech Performance

The more nodes on the network, the faster the network moves. Examples include BitTorrent and Skype.

Language Network Effects

Using a brand name as a verb, such as 'Google' or 'Uber'.

Bandwagon Effects

Getting people to not want to be left out and use certain products, like Apple.

Belief (Network Effect)

The more people believe in it, the more value there is for everyone. Examples include Bitcoin, religion, or gold.