Network Effects Advisor & Investor, part of the Atomico Angel Program. Please direct all pitch decks and consulting requests to sameer@breadcrumb.vc.

Platforms face unique constraints that make them very sensitive to friction — this limits their monetization options to just 3 out of the 6 models used by other types of networks

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Data networks can use five out of six possible monetization models, depending on the way they acquire data from users and the way that data is consumed

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Marketplace monetization depends on two factors — Transaction complexity and the asymmetry in value to the demand and supply sides

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Interaction networks can use one or more of six possible monetization models — the choice between them depends on the structure of their network

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There is a long list of metrics that attempt to measure network effects — putting them in context is the best way to identify the most relevant KPIs for each situation

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There are two types of negative network effects in the software realm — networks can choose between five curation mechanisms to overcome them

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Negative Network Effects


The economic incentives of a platform determine its liquidity barriers — but they also create long-term trade-offs with the effectiveness of developer marketing programs

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The rate of data decay, geographic constraints, and the method of data acquisition combine to define liquidity barriers for data networks — traits that strain liquidity should ideally be balanced by those that ease it

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Synchronous networks like Meerkat and Clubhouse are susceptible to liquidity challenges because they need users to be active at the same time — pivoting to emphasize asynchronous features is one way to overcome these challenges

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Making networks redundant is one way of disrupting strong network effects, but the cost of this is to sacrifice network effects yourself — Startups with foresight should build in new forms of defensibility to compensate for this

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