A Guide to Curation in Community: Leveraging Network Effects for Value Creation

A Guide to Curation in Community: Leveraging Network Effects for Value Creation

In today's digital age, the concept of curation has become increasingly important in community building. Curating forces community builders to process and understand the content that their members are sharing, creating immense value for both the builders and the members themselves. While the value for members is clear - access to trusted and vetted information - the true value for community builders lies in the act of curation.

When we curate, we can't help but learn and understand the community we serve. It allows us to notice new ideas popping up and spreading, providing us with an opportunity to pass on this information to our community. However, it's essential to remember that community curation is for the builder first and the members second. Before saving anything, community builders must ask themselves whether it is worth saving. By capturing only valuable content, the curation process becomes more effective.

However, it's important to note that not everything can be considered valuable. If everything is deemed special, then nothing truly stands out. The power of curation lies in the ability to connect the dots. A repository of information can be helpful, but the ability to find the connections within that information is where the true value lies. By curating content and connecting the dots, community builders can provide immense value to their members.

But how does curation relate to network effects? The network effect is a phenomenon in which a product or service gains additional value as more people use it. This concept can explain 70% of all tech companies' value since 1994. When a network grows, it becomes more valuable for all participants because it increases the probability of meeting their needs. Getting big fast matters because it ensures that competing networks never take hold.

However, the fundamental flaw underlying Metcalfe's law is that it assigns equal value to all connections or groups within a network. The affinity between participants and the value of commerce between them are crucial factors in determining the true power of network effects. Most internet networks allow for cluster formation, which results in the expansion of value at a significantly quicker pace than predicted by traditional laws. The strength, proximity, and activity of nodes within the network also play a role in determining the strength of network effects. Higher density within the network leads to more powerful effects.

Different types of network effects exist, such as personal network effects, 2-sided platform effects, and social network effects. Personal network effects occur when a person's identity or reputation is linked to a product. People are more likely to join a network if everyone they know in real life is using the same product, as there is value in joining the network. 2-sided platforms have supply-side nodes and demand-side nodes that exchange value through the platform's middleman. The platform itself is beneficial to both parties. Social network effects are the hardest to build and maintain, but if successful, they provide a significant advantage for the product.

To leverage network effects, community builders can take several actionable steps:

1. Create a business category and become the number one in that category. By establishing your product or company as the go-to within a specific category, you can generate solid network effects.

2. Utilize token incentives within your product. In the Web3 model, those who contribute to building a community can own a piece of it, creating a fairer and more decentralized system.

3. Focus on organic growth and retention. If your product has network effects, the percentage of organic users compared to paid users should increase over time. Additionally, the retention rate should improve for newer cohorts. These insights are crucial for ensuring the continued growth and value creation of your network.

In conclusion, curation in community building is a powerful tool for both community builders and members. By curating content and connecting the dots, community builders can provide immense value to their members. When combined with the understanding and leveraging of network effects, community builders can create a thriving and valuable community. By following the actionable advice provided, community builders can harness the true potential of curation and network effects, leading to long-term success.