The Cold Start Problem: How to Start and Scale Network Effects

First, the concept of atomic networks provides the clearest goalposts for an upstart network—it’s all about splitting off, or creating from scratch, a distinct and higher-density atomic network.

Focusing on the hard sides of the network, which are usually smaller in number, provides leverage in competitive moves.

There’d always be a regional general manager on the call to present a few slides on what happened.

Network density beats total size, a theme we’ve seen throughout the examples of this book.

Does a new person who joins the product see value based on how many other users are already on it? You might as well ignore the aggregate numbers, and in particular the spike of users that a new product might see in its first days.

In the end, cherry picking is an enormously powerful move because it exposes the fundamental asymmetry between the David and Goliath dynamic of networks. A new product can decide where to compete, focus on a single point, and build an atomic network—whereas a larger one finds it tough to defend every inch of its product experience.

Rarely in network-effects-driven categories does a product win based on features—instead, it’s a combination of harnessing network effects and building a product experience that reinforces those advantages.

One notable example of this is the ever present “People You May Know” or “Friend suggestions” feature. Every social platform at scale has some kind of implementation of it for a reason: it works incredibly well.

Context collapse is meant to be managed carefully, so that there’s enough discovery to hold the network together, but not in such a way that it alienates or overwhelms users.