R. Srinivasan - Platform Business Models: Frameworks, Concepts and Design

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Firms that operate a platform business model have come to dominate the world today, in terms of both scale and performance (market capitalization). Some popular examples include Airbnb, Uber, Facebook, Amazon, and Google. Apart from these, there are quite a few firms operating as platform business models in their specific domestic markets, as well as reaching global consumers.

A unique feature of these platform business models (in contrast to pipeline business models) is that they operate as networks, quite often intermediating between different sides of users. Pretty much like an exchange, some of these firms facilitate interactions, reduce transaction costs, and help with matchmaking across specific user groups. Though such business models were not new, the proliferation of digital technologies and the easy access to the internet through mobile devices have provided the much-needed fillip to the growth and proliferation of these businesses.

This book is an exploration of the economics and strategies of these platform firms. As a student of strategy, I attempt to provide a template and framework for analyzing platform firms economics and strategies, while acknowledging that each firms strategy is unique (akin to its signature). I write this book as a guide to entrepreneurs and intrapreneurs in their journey of establishing and nurturing their platforms as well.

My journey into studying platforms started with a series of accidents. A friend of mine invited me to join his team meeting with a phrase, we seem to be doing something right, but we are not able to explain why are succeeding. The team was actually building a platform, with a product framework. I spent a few hours with the team providing them with the basic concepts of network businesses and platforms, and things began to fall in place in their minds. Within a week of this meeting, a faculty colleague invited me to join a case-writing project which seemed unique. The executive in the firm was talking about leveraging network effects, and my faculty colleague (not from the strategy discipline) was not in sync with the theory and practice of platform business models. The case was being written at a time when the product firm was envisioning a transition to becoming a platform. The very next week after the case-writing conversation, I had to stand in for another colleague of mine for a start-ups meeting with its users. Over breakfast with the founders, we agreed that the best way for that start-up to scale was to reposition itself into a platform. These series of interactions of organizations large and small, mature and young, convinced me that there is a need for deeper understanding of platforms as business models. This exploration led me to seek more and more platform firms, and I got access to study a variety of platform firms, including those founded well before the turn of the millennium with rudimentary technology, which again convinced me of the need to highlight the role of technology as just an enabler in the design of platform business models. And like in most cases, practice was leading theory development.

I continued my exploration through three routescase writing (using primary access to founders and leadership teams of these firms), consulting (I got involved with quite a few start-ups, and entrepreneurs wanted mentoring and advisory support in their journeys), and teaching (I designed and delivered courses on platform business models across business schools in India and Europe, primarily the Indian Institute of Management Bangalore and FriedrichAlexander University of ErlangenNuremberg).

In the process, I have had the fortune of high-quality research support. Mayura walked in with a dilemma of whether to join a Ph.D. program and spent a good nine months; Sandeep and Pramoth also got bitten by the doctoral bug after completing their Advanced Management Programme at IIMB and joined the research team while pursuing their day jobs as well as their academic studies at other institutes; Padma had just completed her Ph.D. and was looking to join academics as a full-time researcher. I also had the good fortune of having passionate teaching assistants throughout my teaching journeySandeep, Padma, and Pramoth at IIMB; Hari, Aida, Aga, and Julius at FAU. Across various years, these teaching assistants made copious notes of my sessions and sometimes even audio recorded them and transcribed them into text for my use.

In addition, the team at the FriedrichAlexander University of ErlangenNuremberg (especially Kathrin, Angela, and Albrecht) was constantly looking for opportunities to integrate my research on platforms with their focus on open innovation and servitization.

This book is a culmination of all these effortscase writing, academic research, and consulting/mentoring firms that operate platform business models. Over the past three years, I have also invested in writing some of my thoughts on my personal blog page ( r-srini.in ). Though I would like to have been more regular in publishing the blog, it gave me the initial impetus to consolidate my learning into this volume. And during the COVID-19-induced lockdown and the resultant virtualization of teaching activities, I have also been able to record a MOOC on the same topic on EdX/ IIMBx (available at https://www.edx.org/course/platform-business-models ), which would be a good supplement to this book.