A few years ago, I’ve started seriously studying network effects. I’ve started a few businesses (retired now, RIP) trying to incorporate things that I’ve learned.
More recently, I’ve taken to examining public companies that exhibit strong network effects in their businesses.
I’m not sure what to make of these companies except that I want to ask a few questions:
- How can we learn from established companies that have strong network effects?
- How can we spot a company with a potential for or ability to maintain the defensibility around their network effects early on?
- Are network effects a “moat”?
- Can all software companies build network effects into their business?
- Is it harder to build a strong core network effect once you have some legacy code/processes built?