In Part 1, I laid out nfx’s 16 network effects. Which is a pretty useable framework. And I agree with about half of them (which is pretty high for me). In Part 2, I want to lay out how I take apart network effects. And it starts with rejecting the graphic below on the left. […]
Network effects are a powerful force in the digital world. They can help businesses to grow quickly and to become dominant players in their markets. However, network effects are not the only factor that is important for success in the digital world. Businesses also need to focus on growth and unit economics.
Baidu, China’s leading search engine, is a “learning platform” that becomes smarter with increased user activity. Founded by Robin Li in 2000, it was designed to cater to search users, webpages, and advertisers. Baidu, like other learning platforms, can serve both human and digital agents, enhancing their service based on the overall and individual user activity.
I recently met with Rodolfo Chung, CEO of rapidly rising Zé Delivery in Brazil. This is a beverage delivery service that was launched by AB InBev right before Covid – and then took off like a rocket during the lockdown. Basically, it’s a mobile app that lets you order any of 500 SKUs for beer, […]
Jeffrey Towson, a China tech expert, believes that TikTok is difficult to copy because it is more than just an app. It is a culture and a community that has been built over time. Imitators may be able to copy the app’s features, but they will struggle to replicate its success without the same culture and community.
My standard question is: What is the quality of the business? I go through lots of checklists for this. It generally takes me 40 pages of written notes to get through a basic assessment of company quality. But the simple version is: What is the market size and its growth? Is there a long-term secular […]
I’ve discussed Amazon’s basic business model in an article and podcast. What Amazon Should Copy from Alibaba and Pinduoduo (Tech Strategy – Podcast 124) Why I Really Like Amazon’s Strategy, Despite the Crap Consumer Experience (US-Asia Tech Strategy – Daily Article) And I basically argued that I look for 3 things in this type of […]
Ok. Let me see if I can impress you today. In Part 1, I wrote about ANE Logistics, an interesting Chinese company. But I really wanted to make a few points about the nature of logistics and physical networks: There is a difference between networks, platform business models and network effects. Physical networks are different […]
Singles’ Day is not just about e-commerce. It is also about user-facing innovation, such as live-streaming, metaverse, and NFTs. It is also about merchant-facing innovation, such as R&D and financing. And it is also about physical assets, such as supply-side scale and building a barrier to entry.
Given the political shake-up in China tech, I’ve been shifting my focus to smaller companies that: Are not of a size that puts them on the radar for anti-trust regulation. Will benefit from government constraints on the giants. So I’ve recently written about NetEase, the #2 player in gaming in China. Is NetEase a Buying […]