The Network Effect

The network effect is defined as an entity getting more valuable the more people who use it. This can equate to a “winner-takes-all” position for businesses and a “moat”, as Warren Buffett and Charlie Munger like to say, to defend your castle (business).

Let’s look at a few examples of The Network Effect:

Amazon

A key to Amazon’s success is that it: …

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The Law of Scale (the benefits are “Ungodly Important”)

In his epic commencement speech to the USC law school grads in 1994, Charlie Munger mentions “scale” 24 times.

The advantages of scale are “ungodly important”, he points out.

Benefits of Scale = Lower Costs, Higher Prices & Bets on New Markets

Benefits of scale include  reducing costs, raising prices and testing new markets.

In a beer business, for example, Anheuser-Busch operates at such a higher volume than Anchor Steam beer (based in San Francisco), that …

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The 3 Ways To Self-Publish Or Sell A Book On Amazon

I Self-Published This Book And Am Considering Selling It On Amazon

So I asked San Francisco freelance writer Angela Privin (Wall Street Journal, Yoga Business Times) to research self-publishing/selling on Amazon and write an article on it. Here’s her summary:

Amazon has three programs for self-publishers to choose from:

1. Create Space
2. Kindle Direct Publishing and
3. Advantage.

1) “Create Space:” Create Your Print- Or E-Book On Amazon

Amazon’s first option is Create Space. This online subsidiary company and self-publishing arm of Amazon.com allows the user to create and format a book for either print or digital distribution on demand. …

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My Favorite Vision & Mission Statements

Below is a list of examples of effective Mission Statements and Vision Statements that I believe are clear.

As a reminder, an effective mission statement (or vision statement) should be:

• Concise
• Specific
• Answer the question: “Are we working on the right thing?”

See How To Write A Vision/Mission Statement, an article I wrote, for more on how to write one.

Enjoy!

AOL

The largest high-quality content producer for digital media – locally, regionally, nationally,
and globally (as of 2011).

“To be the world’s most customer-centric company.”

Apple (back in the early days when they were Apple Computer)

“A computer in the hands of everyday people.” (this was from their early days)

…

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