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Network Effects Win: Interview with Nick Griffin

Nick Griffin, Head of Investments at Munro Partners, says network effects strongly dominate the digital business world.

A network effect is when a good or service becomes more valuable as it’s more widely adopted, creating a virtuous cycle. Examples include Google, or closer to home, CarSales.com.au and RealEstate.com.au. “Once you have that network effect, for instance, with CarSales.com.au, it’s very hard to take it away… Ultimately, it’s not the customer who pays REA that is deciding whether to search at REA or not. It is the consumer, and the consumer is looking at it for free.” In this video, he explains why even Google has failed to compete against businesses with established network effects.

This interview was published by Livewire www.livewiremarkets.com

Disclaimer: The information contained in this presentation is general in nature and should not be relied upon. Before making any investment or planning decisions, you should consult a licensed professional who can advise you whether your decision is appropriate for you. Contributors to this show may have commercial or financial interests in the companies mentioned.