Where do my first users come from? network mobilization strategies for multi-sided platforms

Abstract

Every single platform has a growth stage where it needs to attract enough users onto the platform so that it becomes interesting for users on the other side(s) to on-board. How does affirm attract initial set of users, also referred to as “solving the penguin problem” (Farrell and Solaner, 1987), to the new platform to have a viable business model? Based on a set of case studies on multi-sided platforms in India, we hypothesize that apart from the source of users, the resources that the firm has access to is a critical dimension which firms need to consider in order to strategize the on-boarding of its initial set of users. We first lay out the different aspects of the user and resource dimensions that the firm wishes to leverage. We propose strategic recommendations for new platform firms to adopt when attempting to solve their own penguin problems as they grow.