Pick a Business Model With Leverage

Hosted byNaval Ravikant

Ideally, you should pick a business model with network effects, low marginal costs and scale economies.

• Scale economies: the more you produce, the cheaper it gets 0:00
• Zero marginal cost of reproduction: producing more is free 0:51
• Network effects: value grows as the square of the customers 1:34
• Network effect businesses are natural monopolies 2:26
• In a network effect, each new user adds value to the existing users 3:06
• Zero marginal cost businesses can pivot into network effect businesses 5:01

Transcript: http://nav.al/business-models