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A lot of people have written a lot of words about starting and growing companies — but Eugene Wei, an early Amazon employee who later worked at Hulu, Flipboard and Oculus, noticed that not as many people had written about how companies can keep growing over the long run.
His blog post about that challenge, “Invisible asymptotes,” went viral in May, earning rapturous praise from the likes of Benchmark investor Bill Gurley. Startups that can identify the invisible ceilings to their growth, Wei writes, can adapt and iterate to avoid hitting those ceilings; for example, his former employer Amazon knew that its customers were resistant to paying for shipping, so it developed Amazon Prime to keep them coming back.
You can and should go read the original post at the link above, but you should also listen to the newest episode of Recode Media with Peter Kafka, in which Wei explains the challenges facing some of today’s tech giants.
“Your most vocal and heaviest users may be the ones that prevent you from making the types of changes you need to to reach a broader audience, whether that’s on the same product itself or on derivative products that better serve another audience,” Wei said, referring to Twitter.
“If you look at the raw material of Twitter — how many people are on it, commenting on different things, posting links, posting media, commenting on other things that are happening in the world — from that raw material, there are actually probably other things you could build,” he added. “Other products or services that would be more broadly appealing, appeal to different customer segments ... sort of in the way that Google looked at web links way back in the day and said, ‘You know what? There’s something we can derive from this structure of the web itself, which is different, but very useful.’”
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On the new podcast, Wei also analyzed the problems currently faced by companies like Snap and Facebook. Snap tried to avoid a looming ceiling to its growth by redesigning the Snapchat app to appeal to a broader audience, but the redesign backfired, angering core users and failing to entice the Facebook/Instagram set. Wei argued that ephemeral messaging is not a concept that everyone wants equally, so it makes sense to grow among the people who do want it.
“I’m not sure that Snapchat should focus on trying to get old people to switch over to using the product,” he said. “I would be much more focused on the next generation of young people, and whether they will be also using Snapchat, or whether they will find some other network of their own. Because, to some extent, I think the old people are ... They don’t need a lot of those things, and it’s a distraction to the company to try to rejigger the entire product interface to attract those folks.”
And even though Facebook is still growing internationally, American users are already experiencing negative effects of its maturity, Wei said, to the point that “there may be some negative economies of scale.” In other words, the more people who have joined Facebook and potentially added you as a friend, the more confusing and less useful it is to you.
“Humans, by nature, are very good at maintaining different identities for different groups,” Wei said. “But Facebook, by being the largest social network in the history of the world, has basically munched them all together. I think most humans aren’t, by nature, good at figuring how to broadcast to everybody they know.”
“The way to maybe address that or think about it is think about how to break up that massive single surface area into smaller surfaces, where we are more accustomed as humans,” he added.
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This article originally appeared on Recode.net.
