
The Cold Start Problem: Using Network Effects to Scale Your Product

Products are inherently viral when people bring their friends and colleagues into a network simply by using it—as Dropbox, messaging apps, and social networks do.
Andrew Chen • The Cold Start Problem: Using Network Effects to Scale Your Product
It’s not just the number that matters here, but that it was “500 of the right people”—Sean would explain to me later. It was a group of the most social, most hyperconnected people on the USC campus, all on Tinder at the same time. Tinder started to work. Matches began to happen, as the students who met each other from the previous night started to
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Only three sourcing strategies account for every B2B company’s very early growth. [These are: Personal network, Seek out customers where they are, Get press.] Thus, your choices are easy, yet limited. Almost every B2B business both hits up their personal network and heads to the places their potential customers were spending time. The question
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Cold Start Theory lays out a series of stages that every product team must traverse to fully harness the power of network effects. The curve represents the value of the network as it builds over time, and is shaped as an S-curve with a droop at the end. There are five primary stages: The Cold Start Problem Tipping Point Escape Velocity Hitting the
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Sometimes the army is built on people with excess time, but sometimes it is built on people with underutilized assets as well.
Andrew Chen • The Cold Start Problem: Using Network Effects to Scale Your Product
The technology product metaphor here is obvious—if a messaging app doesn’t have enough people in it, some users will delete it. And as the user base shrinks, it becomes more likely that each user will leave, ultimately causing inactivity and collapse of the network. This is what happened to MySpace as Facebook began to take away its users, or when
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The tool-to-network shift is a specialized strategy—not every network is built this way. Tinder had no single-player mode, nor do communication apps like WhatsApp or Slack—these are products that need their atomic networks to quickly form, which is why smaller critical mass thresholds are better. Marketplaces are generally networks, not tools, from
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Come for the tool, stay for the network” is one of the most famous strategies for launching and scaling networks. Start with a great “tool”—a product experience that is useful even for one user as a utility. Then, over time, pivot the users into a series of use cases that tap into a “network”—the part where you collaborate, share, communicate, or
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This is the copy-and-paste mechanism in motion—take LinkedIn’s curated initial network, give them invites to join a killer product, and watch the network scale with more like-minded individuals.