✍️ Essay
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Intermediate
This essay draws the exact line the question is circling: getting users to bring more users (viral, referral) is a different thing from a product that gets more valuable as more people use it (network effects). Currier, a longtime founder and investor, shows why the two get confused (Facebook had both) and why only one gives you lasting defensibility. Read it to sharpen whether you want spread that fades or value that compounds.
Viral Effects Are Not Network Effects
From nfx.com by James Currier (NFX)
- Viral and referral loops are about cheap acquisition; network effects are about retention and defensibility, and they run on different playbooks.
- Having virality does not mean you have network effects, and chasing referral mechanics can distract from the harder, more durable work.
- Viral channels are always shifting, while network value tends to hold, so lean on the one that keeps paying off.
