🚀 Network Effects 2.0: Explode Your Product's Growth
Some products explode overnight. Others don't. Why?
Andrew Chen calls it "Network Effects 2.0." It's a powerful growth tool. Let's break it down.
💥 The Three Forces
1. 🔗 Acquisition Effect
Users bring in more users. It's free growth.
Example: PayPal users sent money to non-users. New accounts popped up instantly.
Ask yourself: How can users invite friends through your product?
2. 🔄 Engagement Effect
More use makes your product better. Better product means more use.
Example: Facebook gets better as your network grows. You use it more.
Ask yourself: What feature keeps users coming back?
3. 💰 Economic Effect
More users mean more money. You can charge more or sell more.
Example: Airbnb offers more options as hosts join. They can charge higher fees.
Ask yourself: How can you make more money as you grow?
🔥 The Growth Engine
These forces create a loop:
Users bring users.
More users boost engagement.
Engagement creates value.
Value brings more users.
It's a cycle that feeds itself.
👥 Who Runs This Engine?
Two key players drive Network Effects 2.0:
📊 Growth & Product Manager (GPM)
Builds features for growth
Tests new ideas
Watches the numbers
🧠 Chief Strategy Officer (CSO)
Plans long-term growth
Finds new markets
Creates pricing strategies
Startup Founders
📈 Measure Your Progress
Use this scorecard:
Check this monthly. Fix what's broken.
🔮 Think Long-Term
Don't just chase quick wins. Plan for the future:
👀 Watch user needs. They change.
🏗️ Build for scale. Growth can break things.
🌎 Find new markets. Old ones fill up.
🏃♂️ Watch competitors. Stay ahead.
⚖️ Know the laws. They affect you.
🛠️ Don't rely on one platform. It's risky.
💸 Plan to make money. Growth isn't enough.
🎁 Create user value. Always.
🔒 Protect user data. It's your responsibility.
🔗 Connect your products. Make them work together.
🎬 Now What?
Make your product easy to share.
Build features that hook users.
Find ways to make more money as you grow.
Do these things. Watch your product explode.
Your move: How will you use Network Effects 2.0?