 "Indian developer platforms: Where art thou?")
Recently, Facebook announced its usage statistics as part of its second quarter earnings update. Of 1.5 billion monthly active users (MAUs) globally, almost a billion are active on a daily basis. Most of these actives (850 million) are on mobile. Similar numbers for other parts of their ecosystem are no different. WhatsApp boasts 800 million MAUs, Messenger 700 MAUs, and Instagram 300 MAUs. These are staggering numbers however you view them, and define Facebook as the world’s most successful platform. Quick gut check: there are 800 million iTune accounts, 500 million estimated gmail users, and less than 300 million active Amazon accounts.
Facebook’s success underscores the important difference between a digital product and “platform” in tech parlance. A product essentially consists of code base that joins a technology stack -- front-end applications, a set of services, databases, etc. -- to provide a coherent value proposition to users (say, it helps them consume news items they care for). For any product, one can continue building new features and functionalities to provide stand-alone value (e.g., easier search and navigational tools, user reviews, vernacular support). But creating a platform requires one to think bigger and smarter. Those who do, understand one simple truth -- that enabling and empowering others to help you grow results in better and faster outcomes than trying to win alone. Successful platform companies thoughtfully open core assets to third parties for them to build on top of it, and instead heavily invest in the rules and tools that nurture and grow these partner ecosystems.
The Indian startup sector is at a nascent stage when it comes to this mindset. While many companies, especially in ecommerce space, have built businesses around transacting parties -- buyers and sellers -- developer platforms have been largely absent. This is a huge wasted opportunity especially given the steroidal nature of the startup ecosystem today. Platform strategies help companies crowd source innovation, accelerate speed to market, enrich customer data assets, and lock in network effects. Interestingly, the largest developer platform in the country is Aadhaar, which offers developers a set of open authentication and eKYC APIs. Only recently, they organized a 2-day hackathon in partnership with AngelPrime, Khosla Labs, NASSCOM and Morpho focused on innovation in critical areas such as government benefits, payments, financial services, healthcare, FMCG, and online-offline hybrid propositions.
The platform approach can be linked to three broader technology trends. First, the cloud has made it easy for developers to build content and apps for vast global audiences. Entire product & technology stacks are now built with online services. From computing platforms like AWS, to code repositories like GitHub, to Google Analytics and Slack, all can be accessed free or subscribed to for a few bucks a month. Second, with 2 billion smartphone users globally, mobile represents the most powerful platform to reach users anytime, anywhere. Third, the rise of social and digital connectedness - both inside and outside apps - has resulted in new dynamics of adoption, user generated content, and viral growth.
Let’s explore Facebook’s growth trajectory to understand how platforms evolve. It started out as a single-sided platform -- a social network that gradually built features like profiles, walls, posts, friends, newsfeed, messages, etc. It primarily focused on college populations to create critical mass, before it went broad. Once it did, it opened its platform to third party developers, which accelerated introduction of new applications like gifts, marketplace, events, and video, that in turn drove user engagement. The Facebook developer platform was responsible for spawning new tech darlings like Zynga. Facebook Connect was another brilliant move by the company to extend the ecosystem and track the user journey on other websites. Eventually, it helped create a vibrant community of engaged users and their invaluable personal data, which has been monetized through marketers.
Platform strategies have also been implemented by more traditional technology companies. During the couple of years I worked at Intuit, it transformed from siloed “shrink wrap software” company to a fluid ecosystem that built around its core small business platform - Quickbooks. To do this, it had to reinvent and reorganize its various businesses - payments, payroll, tax - and reintegrate them around the core. It also built a new outer layer of strategic partner developers and plug-n-play third party apps that brought new functionalities like bill payment, time & billing, electronic signatures, project management, expense management, CFO for hire, and other services critical to a small business operating system.
Back to implications for Indian startups, it’s important to invest in developer platforms in a long-term strategic and sustainable manner. First, be sure that you have core “exposable” capability that is valuable to other innovators. This can be access to a large user base, or deep customer data, but sometimes even a brand or core technology. Second, developer platforms should not be an afterthought but rather developers should be treated like a new customer or strategic partner base. They need to be evangelized to be brought onboard, given toolkits of code libraries, documentation and sandboxes, and delighted with an awesome developer experience.
Finally, we should remember that platforms are as good as the interactions they drive. Other than creating infrastructure to drive performance at scale, product architects must focus on quality and relevance of these interactions, often mediated through rules of behavior. What incentives are provided to various participating parties on the platform? What information, say in the form of ratings and reputations, is shared in order to minimize risk and enhance the experience? What is the underlying business model and pricing structure that brings traffic? These dimensions should be part of any ambitious tech company’s arsenal of success metrics.
Badal is a tech product professional, who is currently building SnapDeal's Omnichannel initiatives. He is also the co-founder of nirvanalabs.io.