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Pick a Business Model With Leverage
Manage episode 231802189 series 2491217
Ideally, you should pick a business model with network effects, low marginal costs and scale economies.
• Scale economies: the more you produce, the cheaper it gets 0:00
• Zero marginal cost of reproduction: producing more is free 0:51
• Network effects: value grows as the square of the customers 1:34
• Network effect businesses are natural monopolies 2:26
• In a network effect, each new user adds value to the existing users 3:06
• Zero marginal cost businesses can pivot into network effect businesses 5:01
Transcript: http://nav.al/business-models
139 episodes
Manage episode 231802189 series 2491217
Ideally, you should pick a business model with network effects, low marginal costs and scale economies.
• Scale economies: the more you produce, the cheaper it gets 0:00
• Zero marginal cost of reproduction: producing more is free 0:51
• Network effects: value grows as the square of the customers 1:34
• Network effect businesses are natural monopolies 2:26
• In a network effect, each new user adds value to the existing users 3:06
• Zero marginal cost businesses can pivot into network effect businesses 5:01
Transcript: http://nav.al/business-models
139 episodes
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