From HBR: A Study of More Than 250 Platforms Reveals Why Most Fail
Here are the key takeaways from our research into why platforms fail:
First, since many things can go wrong in a platform market, managers and entrepreneurs need to make concerted efforts to learn from failures.
Second, since platforms are ultimately driven by network effects, getting the prices right and identifying which sides to subsidize remain the biggest challenges.
Third, it is important to put trust front and center. Asking customers or suppliers to take a leap of faith, without history and without prior connections to the other side of a market, is usually asking too much of any platform business.
Fourth, although it may sound obvious, timing is crucial.
Finally, hubris can lead to disaster. Dismissing the competition, even when you have a formidable lead, is inexcusable. If you cannot stay competitive, no market position is safe.