- Warren Buffett suggests that economic moats are more durable than competitive advantages.
- Network effects, arguably the most powerful kind of economic moat, occur when a product becomes more valuable as more users join.
- As the world shifts to digital, identifying companies with the right kind of network effects has become more relevant now than ever before.
- In the age of software, market share growth can compound for those with the right types of dynamics at play in their business model.
- Let's review five types of network effects with examples of companies that could easily justify a spot in your portfolio.
For further details see:
5 Essential Network Effects To Invest In The Digital Economy