What Makes Data Valuable: The Truth About Data Network Effects

However, it’s also true that a lot of network-based utility only is realized at some level of scale. (As per NFX: “The simplified definition of network effects is that they occur when a company’s product or service becomes more valuable as usage increases.)

The second fundamental truth of data business models is this: whoever controls the data, captures the value. Intermediaries get squeezed.  A common failure mode is to build a business on top of somebody else’s data. If you depend on a single upstream source for your data inputs, they can simply raise prices until they capture all of the econom... See more