Digital platforms and ecosystems are experiencing exponential growth and disruption. Understanding their dynamics is important for startups, platforms, and ecosystems. Platforms go through phases from pioneers seeking opportunities, to settlers addressing demand, to town planners optimizing operations. Innovation occurs both on top of and below interfaces as value increases. Designing platforms requires understanding value exchanges between roles to overcome challenges like liquidity. Growth involves working like a startup, nurturing relations like a platform, and always disrupting yourself like an ecosystem.

1. Digital Evolutions
Startups, Platforms and Ecosystems
Mentorship Lecture - 25th/26th Sept. 2013
by Simone Cicero - meedabyte.com - @meedabyte

2. Exponential Times
Digital Ecologies
Platform Design Thinking
Digital Evolutions
Understanding Dynamics

3. Exponential
Times

4. everyone is networked with everithing

5. everyone is networked with everything

6. Tech Cycles
(every 10 years)
Now it’s time for Wearable
Image from KPCB Internet Trends ‘13

7. Two main disruption drivers
A growing
computing
density in
matter
Growing
possibilities in AI
and Machine
Learning

8. Connectedness
=
Sharing more and more

9. Text Pictures Videos Sounds Data
Consolidated Explosive
Growth
Ramping up
fast
Emerging Emerging
Mobile chats,
Social
networks
Vine, Intenet
Cams
Sound
sharing,
video chats
(eg: Snapchat)
Personal
Tracking,
Quantified
Self

10. Lifelogging!

12. Data is all & all is Data

13. Everything it’s personalized.
Data are connected and socialized.
Devices are allover the place.
It’s the Digital Market today.

14. Nature
Humans
Technology
Interactions
“Order doesn't come by itself”
Benoit Mandelbrot

15. chaos

16. “We're just increasing our
humanness and our ability to
connect with each other, regardless
of geography”
Amber Case, (Cyborg Anthropologist) - SXSW Keynote 2012

18. Non linear dynamics

19. It’s kinda hard to
predict stuff

20. Illustration: Simon Wardley – blog.gardeviance.org

21. Digital
Ecologies

22. All this demand for innovation drives
componentization*
as a buyer you push down price and ask for
standardization: this creates your competition.
* breaking down into cost competitive and interchangeable pieces.

23. Illustration: Simon Wardley – blog.gardeviance.org
Increasing
competition
in demand
and supply

24. Red Queen Effect
(evolutionary biology)
Regardless of how well a species adapts to its current
environment, it must keep evolving to keep up with its
(also evolving) competitors.

25. competition = coevolution

26. Fortune 500 companies life
expectancy in 2013 is 15 years.
Was 70 in 1930.

27. “Software is eating the world”
Marc Andreessen

28. Access
+
Componentization
+
Collaboration
=
the highest
disruption rate ever

29. Long tail = Diversification
Diversification = Niches
Niches = Economies of Scope

30. “Whereas economies of scale for a firm
primarily refers to reductions in the average
cost (cost per unit) associated with
increasing the scale of production for
a single product type, economies of scope
refers to lowering the average cost for a firm
in producing two or more products”
The Age of Economies of Scope

31. Designers are increasingly dealing with
designing tools that allow users to create
value on their own (and within a
community).
Switching from Economies of scope (multiple
products) to User Centric experiences (user
customizable products)

32. “Toolkits for user innovation allow
producers to abandon attempts to
understand user needs in favor of
transferring need-related aspects of
product and service development to users
along with an appropriate toolkit".
Eric Von Hippel

34. “Unleash your creativity by customizing
select products to create exactly what you
want with eBay Exact. Simply select a
product, choose a design, and add your
own personal flair to create a unique item
for yourself or someone special”

36. "Once you finish
assembling it, you’re
emotionally attached
to that.
You’ve basically gone
through the process to
build your own phone”
Moto X head product manager - Lior Ron

37. tools
Facilitated
Contexts/Channels

38. Consumers can also become
Producers and Designers
themselves.
Roles can change

39. allowing peer to peer
production

40. Understanding
Dynamics

41. Digital Market: opportunities & huge competition
What Dynamics?

42. Pioneers
Thrive in uncertain times
Search for Experimentation
Accept Failure
Players that face poorly understood markets,
trying to define gaps and opportunities,
constantly undergoing changing dynamics and
small numbers.
They want to create the future.
Startups

43. Settlers
Learn from feedbacks
Investigate needs
Spot new trends
Players that face increasing demand, growing
market opportunities for mature products and
revenues that grow accordingly
Platforms
& Ecosystems

44. Town Planners
Search for self disruptions
Base business on measures and scientific models
Optimize for operations
Leaders/players that face standardized
demand and fight growing competition
on mature markets. Always focus on
essential cost of doing Business.
Ecosystems
& Industrialization

45. The ILC Cycle
Illustration: Simon Wardley – blog.gardeviance.org
Innovate
Leverage
Commoditize
(repeat)

46. Facebook Doesn’t
Want To Be Cool, It
Wants To Be
Electricity

47. FB Identity Services
Opengraph
Payment Services
ValueChain
Genesis Custom Built Product Commodity/Utility
Social
Networking

48. Different
Dynamics
Illustration: Simon Wardley – blog.gardeviance.org
Startups
Platforms
Ecosystems

49. In the Platform phase you must
- nurture community
- create community support services
- identify emerging behaviors
- model channels to cope with interactions
In this way
You increase resilience by enabling peer segments to
create their own interactions inside your platform

50. In the Ecosystem Phase you must
- drive cost down and outperform competitors value
- be cool with utility like consumption patterns
- allow new startups/platforms to grow and monitor
use case innovation
In this way
You increase resilence by enabling other business
players to create complex higher value proposition on
top of your interface*

51. Innovation happens:
• on top of the interface*:
higher value systems (use
case innovation)
• under the interface*: process
maturity, elastic provisioning,
measuring (competition)
ValueChain
*interface: a shared and commonly adopted or standardized protocol or practice

52. Arduino
Most of the innovation happens above the
interface (higher value: smaller size, specific
features, etc…) as Arduino has become a
standard community of knowledge (interface)
Microduino
(microsize)
Flutter
(long range)
Smartduino
(modularity)

53. Amazon AWS
Established Amazon Machine Images as the ruling interface in cloud
deployments. Enabled the birth and growth of several (higher) value
proposition.
Commoditized specific frequent uses cases (eg: Elastic Map Reduce for
big data = now a commodity).
ValueChain
Genesis Custom Built Product Commodity/Utility
Amazon
Elastic Map
Reduce
AWS Elastic
Beanstalk (beta)
AWS
OpsWorks
PaaS
Currently
built on AWS
Spotted
growing
usage

54. Joining an existing
Platform and Ecosystem
(outstanding opportunities)
Typical Stakeholders and contexts:
Over The Top players ecosystems
Brand related initiatives
Corporate innovation strategies
Open ecosystems (rare)

55. The App Ecosystem &
OTT Platforms
Eg: Building Native Apps
to be distributed on
Android/iOS
Marketplaces

56. Facebook
Eg: Using Facebook
Connect and Facebook
OpenGraph to enhance
social interactions as
part ofthe proposition.

57. It’s not only about APIs:
corporate players are
increasingly looking for
innovation *ecosystems*

58. Telco players looking for
service innovation
Manufacturers creating
new interfaces and ways
to interact with their
producs.

59. Brands with a growing
user base looking for
disruption.
Emerging fields of
innovation require a
higher experimentation
level and inclusive
innovation plans

60. Typical
Phases
is about
builging
blocks & dev
services
is about
coaching,
infrastructure
& customer
access
is about
market
channels &
numbers
Eg: APIs and
Infrastructures
Startup programs,
Events and
conferences,
Partner programs
Marketplaces,
distribution
agreements

61. Platform
Design
Thinking

62. Grow your startup/product into
a Platform (and then, Ecosystem)
Transform from a linear/single
gap perspective into multilinear
engine of value creation enabling
Peer Segments to co-create value

63. Community
(relations)
Centric
User
(gap)
Centric
Platforms target P2P Communities:
value creation comes from relations,
transactions and exchanges

64. How to lower
Platform opt in cost?
The cost/friction for a user to adopt your
platform and start creating value

65. It’s a (co) Design challenge
about understanding user contexts and
motivations and enabling vaue creation

66. Some big issues in Peer Platforms:
Marketplace Liquidity
Exchange Currencies
Coincidence of Interests
Reaching Tipping Point

67. Some tricks

68. Start from building single user utility
“It might seem odd that systems designed to leverage
interactions between people should have single person utility.
The first users of delicious were barely aware of and rarely used
its social aspects. They just wanted to store their bookmarks in
the cloud instead of in their browser. And they liked the tag
based classification system. And they liked being able to use
their links from any device.
That was the single person utility delicious was built on.”
Fred Wilson (avc.com)

69. Add mutual value
“Users hate spamming friends. It was all fine to begin with
when only a few services required them to send out invites but
as every new service asks for an invite to be sent out, users get
more discerning.
Dropbox had a brilliant way around this by incentivizing not only
the user but also the invitee when he signs up.”
Sangeet Paul Choudary (platformed.info)

70. Spillover (across clusters)
Sangeet Paul Choudary (platformed.info)
“The networks with the fastest growth are the ones that freely allow
spillover. AirBnB, unlike Uber and OpenTable, has tremendous potential
for spillover.
The fact that the use case is travel makes such spillover organic to the
network. The host and traveler will most likely be part of different city
networks. Such cross-cluster interaction allows growth to occur
without having to be confined within geographical boundaries.”

71. Though tricks may work, most of growth
problem are contextual:
there’s no one size fits all recipe
(though best practices count)

72. The right approach:
methodologically focus on
identifying value exchanges
and motivations
Design Thinking &
Platform Design

73. Understand
the basic
roles in the
Platform
Consumers
Producers
Stakeholders
(platform)
ValueChain

74. Explore
the core
value
creation
relation
Consumers
Producers
Stakeholders
(platform)
ValueChain

75. Consider
that
additional
roles may
appear
Facilitators
Curators
Information Brokers
Enabling actors
ValueChain

77. Identifying Peer Segments and relations
between them and with the platform is key
Mapping Platform Stakeholder
motivations will give you insights on how
to overcome chicken/egg problem and
other motivation related design challenges

79. Peer Relations
live through
channels

80. peers

81. Channels must be implemented to
facilitate emerging value exchanges.
In platforms, currencies such as trust
and reputation may be required to
facilitate transactions and should be
clearly valued.

82. the Platform
Design Canvas
(see http://goo.gl/GAi0K)

83. Rel. in June 2013
an iteration of the Business
Model Canvas
(see http://goo.gl/GAi0K)
Key community
Feedbacks:
- doesn’t show logical
value flows
- BM Canvas structure not
good for non linear
business
- doesn’t model platform
lifecycle
- doesn’t help to hack
growth

84. Currently in the works:
Plaform & Ecosystem
Design Toolkit

85. Key challenges
- merging service design thinking
practices with platform thinking
- no more a single canvas (but a
toolkit)
- looking to the different phases
- multi-sided by design
- focused on value flow
visualization
Open for contribution (reach out)

86. 3 Takeouts

87. Work like a Startup
solve gaps and hack growth

88. Grow like a Platform
nurture relations and exchanges

89. Think like an Ecosystem
always disrupt yourself

90. Thanks!
Get in touch and hire me for talks
and workshops on meedabyte.com
Follow me on Twitter
@meedabyte
workshops & consulting
If you enjoyed this don’t forget to
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…and share on Social Media!

91. Special Thanks to:
Simon Wardley as lots of this is based on his insights
Sangeet P. Chaudhary for the exchanges we had on platforms
Raffaele Mauro for the inspiration on trends
Pictures used (Creative Commons):
Thanks Grzegorz Łobiński for the traffic light picture
Thanks alphabetta for the cat picture
Thanks USFS Region 5 for the butterfly picture
Thanks ben britten for the rainforest picture
Thanks Andrew Feinberg for Zuckerberg picture