
Saved by TJ and
The Cold Start Problem: How to Start and Scale Network Effects

Saved by TJ and
The network that constituted Microsoft’s ecosystem could be thought of as three sides—users, developers, and PC makers—with each side attracting the others.
if consumers aren’t asking for a new product, grocery stores aren’t going to carry it, and if grocery stores won’t carry it, consumers can never try it. It’s a classic chicken-and-egg problem.
Spread a tool far and wide, and then grow it properly, and it might start to build networks upon networks around the tool. Continue executing, and the entire market might follow.
“Come for the tool, stay for the network” circumvents the Cold Start Problem and makes it easier to launch into an entire network—with PR, paid marketing, influencers, sales, or any number of tried-and-true channels.
throughout the app—and so it became a central action. New users were asked to import their email contacts to invite more people. After each connection request, users were shown screens of even more suggestions. New users who appeared in other people’s contacts—even if they skipped importing it themselves—had suggested connections right after
... See moreThe earliest users tend to have large contact lists, often way into the thousands, and tend to invite people with similarly large lists. Over months and years, the late adopters of the product might have just a few hundred connections.
The connected bring in the more connected. This results in a dinner party of social butterflies—which is hugely beneficial in launching a new network. I’ve seen this firsthand when working on invite features for social apps and for Uber. You often ask users to import email and phone contacts as part of the invite process, often presented as a “Find
... See moreInvite-only products can facilitate this, because every new user that signs up is already connected to at least one person—their inviter.
Invite-only mechanics provide a better “welcome experience” for new users as well. To explain why, imagine arriving at a large dinner party. A good friend welcomes you at the door, and as you step in, you see acquaintances, close friends, and a number of new people who’ve been curated to be absolutely fascinating.