Reverse network effects set in as platforms scale. Startups comprise the actual platform + value on top of it.
Any platform can leverage network effects. It happens as more users use a platform and increase its value, especially when it’s an early mover with a product market fit.
Reverse network effects are often difficult to understand. In simple terms, it’s just noise on a platform.
The same users who contributed to the initial growth of the platform can now contribute to its failure.
For example, Quora used to have rich content, especially for tech. I believe the quality of the posts has lowered over time because it’s semi-moderated.
There’s no friction to join. Anyone can contribute — domain expert or not.
Leading to more noise than ever.