S-Curves in Platform-based Business – Facing the Challenge of the Tipping Point

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Reference

Steuer, A., & Bayrle, N. (2020). S-Curves in Platform-based Business – Facing the Challenge of the Tipping Point. Paper presented at the PACIS 2020 Proceedings, Dubai.

Publication type

Paper in Conference Proceedings

Abstract

Platforms are among the most successful business models. However, not all platforms are successful; rather, many platforms fail because they do not attract enough users and do not solve the main challenge of reaching the tipping point. It is only after reaching the tipping point that network effects appear, a platform grows self-sustained, and the operator can start capitalizing on the users. Current platform literature primarily discusses the reaching of the tipping point qualitatively, although quantitative estimates using S-curves seem to represent a promising approach. This paper analyzes whether platforms’ adoption follows an S-curve and whether the tipping point can be estimated on this basis. The analysis of 94 platforms indicates that platforms’ adoption is typically S-shaped, and the tipping points can be calculated. These results support the qualitative considerations of other researchers and show that at least 13 months of user growth are necessary to reach the tipping point.

Persons

Organizational Units

  • Institute for Entrepreneurship
  • Chair of Entrepreneurship and Technology

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