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

To solve the Cold Start Problem for marketplaces, often the first move—as it was for Uber—is to bring a critical mass of supply onto the marketplace. For

A zero at Uber was the worst experience you could have, when a rider opens the Uber app with the intent to pick an address and pick up a ride—but there aren’t any drivers in the area! This is a zero. When the point of the product is to interact with other participants in the network, a zero means that its value can’t be fulfilled, which means users

The weekly NACS meeting opened with a familiar slide: a grid of cities and their key metrics—tracking the top two dozen markets. Each row represented a different city, with columns for revenue, total trips, and their week-over-week change. It also included operational ratios like the percentage of trips that hit “surge pricing,” where riders had to

As the population increases, eventually there is a natural limit based on the environment—often called a carrying capacity. For social animals like meerkats and goldfish, overpopulation looks like this, starting flat, then hitting a tipping point before growing quickly and then saturating and falling once again:

When YouTube got to millions of videos, it got hard to find what you wanted to watch.” Yes, this is a fancy problem for a networked product but it’s exactly the problem that YouTube faced as it grew.

It’s important to focus on this tiny slice of users so that messaging, product functionality, and business model are all aligned to serve them. Without this group, the atomic network will collapse—a social network can’t exist without its content creators, and a marketplace can’t exist without its sellers.

For networked products, the curation of the network—who’s on it, why they’re there, and how they interact with each other—is as important as its product design. Starting with a deliberate point of view on who’s best for your network will define its magnetism, culture, and ultimate trajectory.

In other words, not all networked products experience context collapse as rapidly as others. When users are able to group themselves, they prove particularly resilient.

you come in above the Allee Threshold, then the population will grow, because they can keep their mob healthy and protected.