Network effects have emerged as the native defense in the digital world. If you’re starting or investing in a business, don’t start it until you’ve thought thoroughly about how to design it with one or more of the core network effects. Then think about how every additional feature you build could add value to the other users of your product. That way of thinking about business and product design puts you on the road to true defensibility and massive impact and value creation.

2. LINKEDIN acquisition by MICROSOFT
Valued at $26 billion

3. WHATAPP acquisition by FACEBOOK
Valued at $19 billion

4. AIRBNB worth more than HILTON

5. UBER worth is more than GM

6. APPLE, GOOGLE, MICROSOFT
FACEBOOK and AMAZON
hitting all time HIGH VALUATIONS.

7. What these COMPANIES have in common?

8. They are BUSINESSES with
NETWORK EFFECTS

9. NETWORK EFFECTS
The basics

10. NETWORK EFFECT
is a phenomenon where EXISTING USERS of a
product or service benefits when the product or service
is adopted by ADDITIONAL USERS.

11. NETWORK EFFECT
increases VALUE for all the existing users in a network.

12. NETWORK EFFECT
Emerged as the NATIVE DEFENSE in the DIGITAL world.

13. NETWORK EFFECT
Creates more than 70% of the VALUE in TECH BUSINESSES.

14. NETWORK EFFECT
Helps in building DEFENSIBILITY

15. NETWORK EFFECT
DEFENSIBILITY creates VALUE

16. NETWORK EFFECT
DEFENSIBILITY creates VALUE
With critical mass, the value created by the network increases
at an exponential rate whereas costs increase linearly.

17. Defensibilities of the Digital World

18. ECONOMIES OF SCALE:
Saving in costs with
increased level of production.

19. BRAND:
A psychological barrier hard to ignore
Microsoft, PayPal

20. EMBEDDING:
Integrating Software into Operations.
Building switching costs.
Oracle & SAP

21. Network Effects
emerged as the native defence in the Digital World.

22. Companies that have created DEFENSIBILITY using
Network Effect

23. Design DIGITAL BUSINESS with one or more NETWORK EFFECTS.

24. Think of Product/Feature that add value to the other users.

25. Think of features that add value to the other users.
Allow user to participate in VALUE CREATION.

26. Create VALUE by building DEFENSIBILITY

27. Companies with built into their core business model
WIN BIG

28. Virtual Reality / Internet of Things / Robotics
NETWORK EFFECTS and the NEXT BIG THING
Network Effects are gaining importance as the new platforms and the re-invented verticals
all are being born NETWORKED
Crypto-Assets
Fin Tech
Synthetic BiologyAugmented Reality
Artificial Intelligence
Health Care
Agriculture