To explain the concept of network effects, Stanford Department of Management Science and Engineering lecturer Ravi Belani contrasts Facebook with Angry Birds. Both grew rapidly in terms of users, but Angry Birds’ emphasis on a single-player mode meant that its revenue grew in a linear fashion relative to its customers. On the other hand, Facebook’s revenue grew exponentially due to the exploding value of its network.

Video clips from: Building Billion Dollar Businesses [Entire Talk]

3 minutes

The Power of Founders

Watch now

5 minutes

Network Effects 101

Watch now

5 minutes

The Importance of Gross Margins

Watch now

4 minutes

The Archimedes Principle of Venture Capital

Watch now

Share Post