How did Airbnb beat Craigslist? What's special about the Medium blogging platform? How did LinkedIn eat Monster for lunch? How do Youtube and Vimeo coexist? Why was Mint.com so successful? Using the Platform Stack framework, this deck explains 10 startup business puzzles and creates a framework to solve many more.

1. Startup Business Puzzles
Visualized And Explained1 SANGEET PAUL CHOUDARY
GEOFFREY PARKER
MARSHALL VAN ALSTYNE
Source: PLATFORM THINKING

2. One compelling framework to
make sense of digital business
models
Source: PLATFORM THINKING

3. Why do YouTube and Vimeo coexist
despite being similar offerings?
“
”Source: PLATFORM THINKING

4. How did Airbnb disrupt
Craigslist?
Source: PLATFORM THINKING

5. It was Instagram, before Instagram
existed
Why did it fail?
Ever heard of
Hipstamatic?
Source: PLATFORM THINKING

6. Why did LinkedIn beat
Monster?
Source: PLATFORM THINKING

7. “ What's so special about
Medium, isn't it just about
blogging? ”
Source: PLATFORM THINKING

8. How did a 3-year old startup like
Mint beat a three-decade old
software like Quicken?
Source: PLATFORM THINKING

9. Flickr was doing so well, what
happened?
Source: PLATFORM THINKING

10. What's so
revolutionary
about the App
Store model?
“
”
Source: PLATFORM THINKING

11. How did Facebook
eat MySpace and build
an entirely different
business?
Source: PLATFORM THINKING

12. And finally...
Source: PLATFORM THINKING

13. Airbnb is a platform,
but so is GE's industrial
internet approach.
Medium is a platform
but so is Nike.
How do you make sense of
this? What exactly is a
platform?
”
“
Source: PLATFORM THINKING

14. Read on to get
all the answers
”
“Different questions,
similar answers
Source: PLATFORM THINKING

15. Too busy to get all the answers?
Download this deck
Source: PLATFORM THINKING

16. Better still,
click here
to get the whole book
Source: PLATFORM THINKING

17. What does that even mean?
Let's visualize
digital business models
Source: PLATFORM THINKING

18. The Platform Stack
Source: PLATFORM THINKING

19. To start visualizing,
we need a visual framework
Introducing...
The Platform Stack
Source: PLATFORM THINKING

20. Wait... What's a platform?
Source: PLATFORM THINKING

21. Everyone seems to be building one...
Source: PLATFORM THINKING

22. But everyone has a different definition
Source: PLATFORM THINKING

23. The platform stack helps
us understand this…
... and visualize any digital
business model
Source: PLATFORM THINKING

24. So WHAT is a platform?
Source: PLATFORM THINKING

25. So what is a platform?
A platform is a plug-and-play
business model that allows
multiple participants (producers
and consumers) to connect to it,
interact with each other and
create and exchange value.
”
“
Source: PLATFORM THINKING

26. A lot of what we see today follows
the platform business model
Source: PLATFORM THINKING

27. Buzzword alert...
all of these use
platform business models
Wearables
Sharing Economy
Industrial Internet
3D Printing
Internet of Things
Social media
App economy
Crowdsourcing
Gig economy
Crowdfunding
!
Source: PLATFORM THINKING

28. The goal of a platform is
to enable interactions between…
Producers Consumers
Source: PLATFORM THINKING

29. To understand platforms, we need to use THE
PLATFORM STACK

30. Across all platforms, we observe
the following three layers3
Network / Marketplace / Community
Data
Technology Infrastructure

31. Network / Marketplace / Community Layer
Users may
connect explicitly
Users may
interact without
connecting explicitly
Users may be connected implicitly
E.g. Individual usage is benchmarked against others
Source: PLATFORM THINKING

32. Technology Infrastructure
External producers build on top of this infrastructure
On Android,
developers
build apps
On Youtube,
video creators
host videos
On Ebay,
sellers create/host
product availability
Source: PLATFORM THINKING

33. Data
Data matches users
and content
Data powers
relevance
Source: PLATFORM THINKING

34. Different platforms have different
stack configurations
There are
3 basic
configurations
Source: PLATFORM THINKING

35. Marketplace / Community-Dominant
Source: PLATFORM THINKING

36. Infrastructure-Dominant
Source: PLATFORM THINKING

37. Data-Dominant
Source: PLATFORM THINKING

38. Every platform
is a different
configuration
of this stack
Source: PLATFORM THINKING

39. Like what you’re
reading?
click here to enter the
book giveaway
Source: PLATFORM THINKING

40. Startup Business Puzzles
Illustrated with the Platform Stack
1 Source: PLATFORM THINKING

41. Why do YouTube and Vimeo coexist
despite being similar offerings?
“
”Source: PLATFORM THINKING

42. YouTube Vimeo
Network / Marketplace /
Community
Technology Infrastructure
Data
Network / Marketplace /
Community
Data
Technology Infrastructure

43. YouTube Vimeo
Network / Marketplace /
Community
Technology Infrastructure
Data
Network / Marketplace /
Community
Data
Technology Infrastructure
Improve viewer engagement and
match-making
Improve hosting
infrastructure

44. YouTube Vimeo
Network / Marketplace /
Community
Technology Infrastructure
Data
Network / Marketplace /
Community
Data
Technology Infrastructure
Youtube and Vimeo co-exist by focusing on different layers
of the stack

45. How did Airbnb disrupt
Craigslist?
Source: PLATFORM THINKING

46. Craigslist Early Airbnb Airbnb
Network /
Marketplace /
Community
Technology
Infrastructure
Data
Marketplace /
Community
Technology
Infrastructure
Data
Marketplace /
Community
Technology
Infrastructure
Data

47. Craigslist Early Airbnb Airbnb
Network /
Marketplace /
Community
Technology
Infrastructure
Data
Marketplace /
Community
Technology
Infrastructure
Data
Marketplace /
Community
Technology
Infrastructure
Data
Strong network layer only, low
focus on tech and data
Started with strong tech and
data layers
Built strong network effects and
community over time

48. Craigslist Early Airbnb Airbnb
Network /
Marketplace /
Community
Technology
Infrastructure
Data
Marketplace /
Community
Technology
Infrastructure
Data
Marketplace /
Community
Technology
Infrastructure
Data
Airbnb beat Craigslist through superior execution on all layers

49. It was Instagram, before Instagram
existed
Why did it fail?
Ever heard of
Hipstamatic?
Source: PLATFORM THINKING

50. Hipstamatic Instagram
Technology Infrastructure
Network / Community
Data
Technology Infrastructure

51. Hipstamatic Instagram
Technology Infrastructure
Network / Community
Data
Technology Infrastructure
Focus on provision of
tools only
Focus on creation of community
through provision of tools

52. Hipstamatic Instagram
Technology Infrastructure
Network / Community
Data
Technology Infrastructure
Instagram beat Hipstamatic by focusing on community
and building network effects

53. Why did LinkedIn beat
Monster?
Source: PLATFORM THINKING

54. Monster LinkedIn
Network / Community
Technology Infrastructure
Data
Network / Community
Data
Technology Infrastructure

55. Network / Community
Technology Infrastructure
Data
Network / Community
Data
Technology Infrastructure
Lower network effects, focusing only
on active job seekers
Much stronger network effects and higher data leverage
lading to activation of passive seekers
Monster LinkedIn

56. Network / Community
Technology Infrastructure
Data
Network / Community
Data
Technology Infrastructure
By focusing on overall data acquisition about professionals, LinkedIn
has better data to match the recruitment market
Monster LinkedIn

57. “ What's so special about
Medium, isn't it just about
blogging? ”
Source: PLATFORM THINKING

58. Wordpress Medium
Technology Infrastructure
Network / Community
Data
Technology Infrastructure

59. Wordpress Medium
Technology Infrastructure
Network / Community
Data
Technology Infrastructure
Infrastructure-only
focus
Less sophisticated infrastructure but
strong network and usage of data

60. Wordpress Medium
Technology Infrastructure
Network / Community
Data
Technology Infrastructure
Medium is gaining rapid traction leveraging network effects and
data and a simpler creation infrastructure

61. How did a 3-year old startup like
Mint beat a three-decade old
software like Quicken?
Source: PLATFORM THINKING

62. Quicken Mint
Technology Infrastructure
Network / Marketplace
Data
Technology Infrastructure

63. Quicken Mint
Technology Infrastructure
Network / Marketplace
Data
Technology Infrastructure
Focused only on provision of
software
Software as a means to build a data driven
business and the creation of a marketplace
between consumers and FIs

64. Quicken Mint
Technology Infrastructure
Network / Marketplace
Data
Technology Infrastructure
Mint’s business model leveraged data to subsidize software and
gain rapid adoption

65. Flickr was doing so well, what
happened?
Source: PLATFORM THINKING

66. Flickr Facebook
Photos
Network / Community
Technology Infrastructure
Data
Network / Community
Data
Technology Infrastructure

67. Flickr Facebook
Photos
Network / Community
Technology Infrastructure
Data
Network / Community
Data
Technology Infrastructure
Better hosting but lower
community engagement
Stronger network effects and usage data of overall
social network enabled better engagement

68. Flickr Facebook
Photos
Network / Community
Technology Infrastructure
Data
Network / Community
Data
Technology Infrastructure
Facebook’s stronger network effects and better capture of data allowed
its Photos feature to power stronger engagement

69. What's so
revolutionary
about the App
Store model?
“
”
Source: PLATFORM THINKING

70. MS Windows
Android +
Play Store
Technology Infrastructure
Network / Community
Data
Technology Infrastructure

71. MS Windows
Android +
Play Store
Technology Infrastructure
Network / Community
Data
Technology Infrastructure
Focused only on infrastructure for
app development
Combines infrastructure with app store,
enabling creation or marketplace

72. MS Windows
Android +
Play Store
Technology Infrastructure
Network / Community
Data
Technology Infrastructure
The app store powers a new market for developers, thereby
attracting a larger ecosystem much faster

73. How did Facebook
eat MySpace and build
an entirely different
business?
Source: PLATFORM THINKING

74. MySpace Facebook
Network / Community
Technology Infrastructure
Data
Network / Community
Data
Technology Infrastructure

75. MySpace Facebook
Network / Community
Technology Infrastructure
Data
Network / Community
Data
Technology Infrastructure
Strong network effects but poor usage
of data and lower curation
Much stronger network effects and higher data leverage
through the creation of the news feed

76. MySpace Facebook
Network / Community
Technology Infrastructure
Data
Network / Community
Data
Technology Infrastructure
Facebook’s news feed leverages data to drive much stronger
network effects than any social network before it

77. Different platforms have different
stack configurations
There are
3 basic
configurations
Source: PLATFORM THINKING

78. Your turn:
Analyze your platform using the platform stack
Network / Marketplace / Community
Data
Technology Infrastructure

79. And now,
click here
to get the whole book
Source: PLATFORM THINKING

80. Want to download this deck?
Click here!
Source: PLATFORM THINKING