Unleashing Growth and Value Capture: Lessons from LinkedIn and the Ownership Economy

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Aug 01, 2023
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Unleashing Growth and Value Capture: Lessons from LinkedIn and the Ownership Economy
Introduction:
In today's rapidly evolving business landscape, achieving sustainable growth and effectively capturing value are crucial for the success of any organization. This article explores the strategies employed by LinkedIn to scale from 500,000 to 500 million users in 13 years. Additionally, we delve into the concept of the ownership economy and how it can revolutionize value creation and capture for artists and creators. By analyzing the commonalities between these two realms, we can extract actionable insights applicable to various industries.
Stage One: Stimulating Virality
Every startup faces the critical challenge of growth, and LinkedIn was no exception. In its early days, the company believed that growth had to be ingrained in the product itself. Rather than relying on a dedicated growth team, every individual within the organization became responsible for fueling growth. This grassroots approach allowed LinkedIn to harness the collective efforts of its team, resulting in significant user expansion.
Stage Two: Systematizing Growth
From 2008 to 2011, LinkedIn underwent a transformative phase by institutionalizing its growth efforts. The company recognized the need to build a dedicated growth team comprising product specialists, marketers, data scientists, and engineers. By studying user behavior and analyzing how individuals discovered the platform, LinkedIn identified its major growth channels. This systematic approach propelled LinkedIn's user base from 14 million to an astounding 140 million.
Stage Three: Using Data to Ramp Up Growth Rate
In the third stage, LinkedIn delved deeper into understanding its members beyond the acquisition stage. By defining a "North Star" metric for success, the company focused on delivering an exceptional product experience. Additionally, LinkedIn emphasized identifying new growth channels by continuously monitoring how users found and engaged with the platform. This data-driven approach enabled LinkedIn to optimize its growth rate and solidify its position as a leading professional networking platform.
Better Aligning Value Creation & Value Capture
Shifting gears, we now explore how the ownership economy can transform the relationship between creators and their audience. Traditionally, artists have struggled to capture the full value of their work, leading to undermonetization and limited growth opportunities. However, the advent of cryptocurrencies and blockchain technology has opened up new possibilities for direct value capture.
Crypto networks empower creators to directly capture the value they generate, enabling them to profit from their early supporters. By allowing fans to become stakeholders in the success of artists, the ownership economy incentivizes broader support and expands the total number of supporters. This model resembles the video game industry, where the base content is often given away for free, leveraging viral marketing to monetize complementary products.
The ownership economy not only benefits artists but also addresses the undermonetization of industries at large. By leveraging crypto networks, creators and collectors can access capital markets more easily, attracting investment and aligning financial incentives for all stakeholders. This paradigm shift ensures that creators can directly monetize their work and charge their audience in a granular manner, ultimately leading to increased revenue per fan.
Conclusion:
Based on the success story of LinkedIn's growth and the transformative potential of the ownership economy, we can distill three actionable advice:
- 1. Integrate growth into the DNA of your product: Encourage every team member to contribute to growth initiatives, fostering a collective effort toward expansion.
- 2. Embrace data-driven decision-making: Continuously analyze user behavior to identify growth channels and optimize your product experience accordingly.
- 3. Explore the ownership economy: Consider leveraging crypto networks to directly capture and monetize the value you create, enticing supporters to become investors.
In an era marked by rapid technological advancements, businesses and creators must adapt to unlock their full potential. By embracing growth-oriented strategies and exploring innovative value capture models, organizations can thrive in the dynamic landscape of the 21st century.
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