🌐 How to Build a Network-Effect Product...

5 Steps for Building Solutions That Don’t Scale: Insights from Startup Expert Paul Graham.

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Want to build the next TikTok, Facebook, Uber or Airbnb? You know, products whose true value only unlocks once you’ve onboarded a certain number of users/stakeholders.

Well, the trick to building a network effect product is to NOT DO IT (at first, at least).

Method in the Madness

According to Y Combinator co-founder Paul Graham, and his 2013 essay that’s become startup folklore, it’s much better to build things that don’t scale at first.

What that means is: Network-effect products are complex, costly and super risky to build. If you don’t nail it first-time, you waste years of time and resources and so much money your investors won’t ever want to touch you again – that’s why most won’t invest in network-effect products anymore.

It’s best to build a non-scaling version first.

For example: Instead of trying to build a fancy new product

• see if you can deliver the service using simple tech like a spreadsheet first
• or see if you can build the community it will eventually serve, first.

Then, only once you have the community and service running so smoothly you can’t manage it anymore, that’s when you consider building the product. (It’s more common than you think: EskomSePush also started as spreadsheets first.)

So, how do you build for not scaling? Well, we were lucky enough to have an expert at that in our “How Would You Build It” podcast this week – check it out down below.

For now…

5 Steps for Building Solutions That Don’t Scale

1. Start with a deliberately narrow market
   1. Instead of targeting a broad audience, focus on a specific subset of users who are likely to adopt your product or service quickly. By concentrating your efforts on a niche market, you can create a critical mass of users and gain traction more rapidly. Expand to a broader market once you have a solid foundation.
2. Recruit early adopters manually
   1. Engage in personal outreach, offer hands-on setup assistance, and take advantage of your existing network and connections to acquire users.
3. Focus on user delight
   1. Go above and beyond to make your early users happy. Provide exceptional customer service, personalize the user experience, and find creative ways to exceed their expectations. Aim to make signing up with your startup one of the best choices they've ever made.
4. Obsess over delighting users
   1. Strive to create an insanely great experience for your users, even in the early stages when your product may be incomplete or buggy. Hint: it’s not your tech. Ask yourself – what is a 5-star experience? Pay attention to the details, iterate based on user feedback, and be attentive to their needs. Continuously seek ways to improve and make the user experience exceptional.
5. Engage as consultants for a single user
   1. Treat a single user as a consulting client and build a tailored solution specifically for their needs. Continuously iterate and refine your product until it perfectly meets their requirements. By solving their problem effectively, you increase the chances of attracting similar users and expanding into adjacent territories.

Stuck on how to “minimise” your big product idea? Hit reply and give us the non-NDA version and we’ll brainstorm it a bit with you…

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