Why tiny moats can beat massive platforms
How to build small network effects into your product
Time: 2.50 Minutes
Last week I saw this build in network effect on Indy Hacker Tibo’s automated product Outrank to increase your SEO rating, which got me thinking…
Do have network effects to be big all the time to create value and a moat? Or can small network effects also increase the value of small (indy) products and services?
Everyone obsesses over massive network effects like Facebook or LinkedIn. But while you chase billion-user dreams, smart builders create tiny moats that compound daily.
This fixation on scale is killing good ideas before they start. Therefore you should embrace small network effects…
But how do you build one?
Here are some directions to get you going:
Start ridiculously small.
Find 10 users who desperately need to connect with each other. Not 10,000. Just 10.
Make sharing inevitable.
Build features where users naturally invite others to complete tasks. Shared documents. Group challenges. Collaboration tools.
Create mutual dependence.
Design your product so users become more valuable to each other over time. Shared data. Accumulated trust. Joint investments.
Yet most founders think network effects require massive scale. Why?
We're taught that bigger always means better. That you need millions of users to matter.
The cost hits you directly.
While you're building for everyone, someone else captured a small, devoted group that refers religiously.
Small network effects compound faster than large ones. Ten engaged users beat thousand passive ones.
Your local gym has network effects. Your neighborhood WhatsApp group has network effects. Your company Slack has network effects.
Stop chasing Facebook. Start building your corner of the world.
So keep connecting people, and stay curious.
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Have an epic time, see you soon for the next Transmission…
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