

Your startup probably isn't a platform - gregpilling
http://finance.fortune.cnn.com/2011/08/22/your-startup-probably-isnt-a-platform/

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jgilliam
How is Amazon not a platform? Completely leaving aside AWS (which the author
does mention):

a. it has zillions of stores selling through it b. a whole generation of small
businesses have been built by people selling used books, cds and dvds. c.
anyone can publish their own books, cds and dvds d. anyone can use their
fulfillment services and payment services e. digital video and music f. kindle

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davedx
It's an (albeit extremely large and diverse) e-commerce website, not a
platform. What software do you build that runs on top of Amazon?

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byoung2
_It's an (albeit extremely large and diverse) e-commerce website, not a
platform. What software do you build that runs on top of Amazon?_

Ignoring AWS, there are lots of complex systems you can build on top of
Amazon. One example is Fulfillment by Amazon. You can integrate this service
with your ecommerce website, and Amazon can warehouse your inventory in its
facilities nationwide, charging you based on the volume of your inventory.
They will automatically select a warehouse closest to your clients that has
your item in stock and pack and ship it, and even order more inventory from
your supplier when a certain warehouse inventory level falls below a certain
threshold. It is basically S3 backed CloudFront for physical goods.

~~~
ja2ke
Fulfillment seems like a service. You don't build a business on someone else's
warehouse, you use their warehouse to support your business. Unless someone's
writing a "Fulfillment by Amazon Client" and selling it, I guess.

~~~
byoung2
_You don't build a business on someone else's warehouse_

From the article:

 _A software platform is truly a foundation on which entire businesses can be
built. It encompasses not just a technical infrastructure but also a user
experience framework, usually some form of a selling channel, and a defined
large-scale developer ecosystem_

If that isn't the very definition of Amazon, I don't know what is. In theory I
could build an entire business on top of Amazon's infrastructure (and not just
a software business). I could have outsourced labor write or edit content
using Mechanical Turk. I could publish it using Amazon's self-publishing
tools. I could sell it through Amazon's marketplace or on an ecommerce site
hosted on AWS. I could collect payments using Amazon FPS. I can ship products
using Fulfillment by Amazon. You most certainly can build a business using
someone else's warehouse, just as Heroku and RightScale can build businesses
on someone else's datacenter. Fulfillment is a service, but is is a PaaS - a
robust logistics platform as a service.

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ja2ke
I read the article. This thread started with "S3/AWS aside." I think "Amazon"
isn't a platform because it's not a single thing ("Facebook"), but Amazon
offers a number of services which can be used in concert. Maybe those are
actually the same in practice, but they exist in different spaces in my brain.

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andrewtbham
This guy appears to be frustrated because he is using the term platform in a
very narrow sense. By his definition it requires a "developer ecosystem."
Whereas the people he hears use the term are referring more correctly to a two
sided market.

<http://en.wikipedia.org/wiki/Two-sided_market>

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jcc80
"At least for me, pitching a business as a platform when it really isn't tends
to degrade what might be a really interesting vision and story in and of
itself."

I suppose, but that's a pretty small downside. For others pitching yourself as
a platform can lead to more buzz, more possibilities and of course...maybe a
higher valuation. And, fact is you can't know where things are going so you
might as well build & position yourself as a platform if it makes sense.

~~~
hack_edu
So, vigorously insist it's a duck even if it can't quack. Sleaze is the
fastest route to funding?

I'm all too reminded of Saturday's NYT article[1]

[1] [http://www.nytimes.com/2011/08/21/technology/silicon-
valley-...](http://www.nytimes.com/2011/08/21/technology/silicon-valley-booms-
but-worries-about-a-new-bust.html)

~~~
jcc80
"vigorously insist" & "sleaze"? Someone may have a case of the Monday's...:)
Maybe you read something into it that wasn't written (you'll notice I ended w/
"if it makes sense.") Anyways, point was you don't know where you'll end up so
think big and go for it.

~~~
hack_edu
I will concede my Mondays half-caffeinated status at the point of writing. My
tone was a bit strong but I stand by my commentary. :)

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freddealmeida
The use of platform, in the creative agency space is somewhat different. A
platform doesn't need to have an eco-system if it creates value for the
consumer and develops a community around that value. In this sense Nike+ is a
platform. Twitter is too.

The idea that a startup is only a platform if one can build on top of it, may
be taking the idea too far.

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jmitcheson
"or perhaps your a dev tools business"

Your / you're error in published article.. ugh

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cek
What you are building is either an app or a platform. If you try to make it
both you will fail. And there are very few (if any) examples of successful
platforms that started as a platform.

~~~
cek
Surprised this got down voted. Maybe I should explain further.

Point 1: If a startup tries to be both an "app" _and_ a "platform" it will
fail.

In my experience, when building a new product, teams need to make a choice
very early on whether they are building something that is all about end-user
value/experience ("an app") or all about 3rd party value ("a platform").

Groups that attempt to do both lack focus. They don't do a great job building
a great user experience and they don't do a great job building the platform
because these two things are in tension. Example: enabling a 3rd party plug-in
model requires the creation of UI that is often complex from a user's
perspective. The investment in that UI to make it great (especially at an
early stage when you don't really _know_ what or how many 3rd party extensions
will get built) could be _better_ spent on building end-user-valuable
functionality in the core of the product.

This point is all about focus. To be successful startups need extreme focus.

Point 2: There are very few (if any) examples of successful platforms that
started as a pure platform.

Name a few successful "platforms". Before you do, for the sake of argument,
agree with me that "successful platform" implies the platform has a vibrant
set of independent partners who both contribute to and "profit" from the
platform. I could also use the term "virtuous platfrom" which has come to mean
a platform composed of a multi-sided market where each side of the market
derives value in a symbiotic cycle with the others.

[EDIT added link]
[http://en.wikipedia.org/wiki/Virtuous_circle_and_vicious_cir...](http://en.wikipedia.org/wiki/Virtuous_circle_and_vicious_circle)

The "virtuous platform cycle" that most people use as the prototypical example
is the Windows ecosystem. The market sides were: Windows, Intel, OEMs (e.g.
Compaq, DELL), IHVs (e.g. ATI, HP printers), ISVs (e.g. Lotus, Adobe, Office),
retailers & channel (e.g. Egghead), and of course, end users.

All of these "market sides" drew great value from one another as part of the
Windows ecosystem. They all made money, hand-over-foot, because the "virtious
platform cycle" snowballed.

There are many examples of other platforms with a virtuous cycle today.
Google's search engine, Apple's iOS, and on a smaller scale something like
Minecraft (although that's a nascent example).

For each example YOU come up with, ask this question: What came first, "end
user value" or "developer/3rd party platform"? In my case, I struggle to find
examples where the platform STARTED as something that was focused on
developer/3rd party value. You might argue Java, but then I'd say "in what way
did the creator of that platform make any money off the platform?".

Discuss. :-)

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robfig
Isn't every social network out there a counter to #1? e.g. Facebook, Twitter

Both are Apps, and both allow you to write code against them (or maybe Twitter
doesn't count because it doesn't run on their site?)

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cek
Both examples actually re-enforce my argument because _when they started_ they
were all about delivering value to their end-users. Yes, twitter exposed an
API really early on, but their _focus_ was delivering on the end user promise
of short messages.

Facebook did not add an API until much later and "being a platform" did not
become a priority until recently.

~~~
rabidb
Steam for games?

~~~
cek
Steam is primarily a channel.
[http://en.wikipedia.org/wiki/Distribution_channel#The_distri...](http://en.wikipedia.org/wiki/Distribution_channel#The_distribution_channel)

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edanm
The argument about Amazon is wrong - it may account for 3% _now_ , but it's
still a work in progress, a growing business. Much as the e-commerce business
was unprofitable for most of the early life of Amazon, because it was still
growing.

