Here are my top notes from the book
Platform Scale by @sanguit.
Still my platform strategy bible!
#networkeffect #platform #marketplace #growth #startup #scaleup #innovation #businessmodel
SCALING FROM USERS INTERACTIONS
The fastest scaling business models
allow external producers and consumers to
plug in and create and exchange value
with each other directly.
Value lies NOT in owning resources
but in managing the exchange of services
in an ecosystem.
VALUE CREATION
The value is not created by the platform itself,
but by the interactions on top of the platform.
The platform business model
is to capture a part of the value
that is created in the meetings between users.
NOT ONLY MONEY IS A CURRENCY
The values exchanged on the platform
is not only money
but also social currency
as exposure, followers, likes, rating, sharing.
Thus, businesses should be measured
not just in terms of dollars absorbed,
but in DATA absorbed from users.
TRUST and QUALITY SUPPLY
Platforms must invest in trust mechanisms
that differentiate good from bad.
Access and quality control must be done,
either manually (screening, background checks)
or by aggregating social signals from the community.
BALANCE SUPPLY AND DEMAND
to keep both producers and consumers
on the platform.
Make sure that both user groups
receives value.
Scale production and consumption
simultaneously, and repeat
so that each reinforces the other.
NETWORK EFFECTS
Make the volume of users
a benefit for other users.
This is called network effects,
and it is what makes the platform scale.
The platform becomes more valuable
as more value is created and exchanged by the users.
STICKYNESS
To ensure participation from the users,
the platform owner must invest in
behavior design to
create new habits,
that makes the users want to
stay engaged on the platform.
The PLATFORM BUSINESS MODELL
Is NOT a software building business
Is NOT a product/service selling business
But a business of mediating and enabling interactions
HOCKEY STICK GROWTH
Successful platforms can get a
hockey stick growth curve.
Not because of superficial growth hacks,
but by understanding
the real drivers of platform scale:
activity in the ecosystem
That is achieved by the right business design
and architectural decisions.
THE ONE METRIC
that platforms should be judged on
is the rate at which value is created on the platform.
Not the technology or the rate of user adoption.
THE CENTER STARTING POINT
Platform design should start with a center,
not with features.
Center on the goal of value creation enabled.
This determines how the users will interact.
The closer one aligns each feature around a center
the more intuitive the platform's usage is.
THE CORE VALUE UNIT
- is the minimum standalone unit of value
created on the platform
- is required to spark interactions
- is not controlled by the platform
- is the scaling variable

The more units and
the higher the quality,
the more valuable the platform will be.
FILTERS
Ensure that consumers are served
only the goods, services, and content
that are most relevant.
Filters may be point-in-time or based on past behavior.
Filters may be active (search query) or
passive (newsfeed).
Collaborative: "others also purchased this"
THE CORE INTERACTION
consists of these actions (four C's):
- Creation: Producers that creates value (the core value unit)
- Curation: Rating of the producers
- Customization: Filters to create a relevant experience for the customer
- Consumption: Consumers consumes value
AVOID DISTRACTIONS
Features, functionalities and initiatives
that do not directly affect the core interaction,
may distract the team from more important execution.
PLATFORM STRATEGY
1. Pull: Producers and consumers must be pulled to the platform and engaged on an ongoing basis.
2. Facilitate: Ensure that the tools and services enables users to interact in a desirable way.
3. Match: Use data to serve relevant items to consumers.
VALUE CAPTION ON PLATFORMS from
- Money transactions
- Charging one side to access the other
- Advertising from a third party
- Premium tools and services
- Charging consumers for access to high-quality, curated providers
- Charging producers for an ability to signal high-quality
EXPECT EMERGENCE
A well-designed platform
should encourage and allow the users
to take the platform in new directions
that the owner never expected.
Make changes to enable the users to move in that direction.
This is one the most common way for platforms to pivot.

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