The Cold Start Problem: A Brief on How to Build Digital Networks of Startups

Roshni Khatri

23rd Mar'22
The Cold Start Problem: A Brief on How to Build Digital Networks of Startups | OpenGrowth

 It was an exciting moment for me to see that “Andrew Chen” had written a book on the problem of a tech startup. My plan to read the “Cold Start Problem” is my curiosity about discovering the ideas of start-ups. I heard about this from an acquaintance and he told me that the book is about the subject I was looking for, so I read the book and will share my thoughts on it too. 

It is good to start your own business as this can create more revenues for the economy and the nation. If you are looking for a perfect idea about initiating your venture then you can refer to the 10 best business books, as they will provide you with brief information about your business starts.

Andrew has written the book on the topics of tech startups, the reasons for failing the ventures and the impact of effective networks in leading the business ahead. So Let's start with a brief overview of the book!



“The Cold Start Problem” is about start-ups and discusses the problems that arise in tech start-ups. In other words, the book is about businesses that have two sides of connections. The book describes the non-obvious examples of Wikipedia, Tinder, Uber, DropBox and Instagram. As these, all are the most successful start-ups and are leading in the commercial world. 

“Andrew Chen”, has written the book to discuss several ways to focus on the problem with stickiness, engagement loops and the power of the network to explore how it can create an impact in marketing. 

You know that if the power of the network is good enough then it can create a good marketing and supply chain. I explored the effect of networks in establishing the start-ups and defensibility of matured tech apps. 


Andrew Chen


About the Author

Andrew Chen is the partner at Andreessen Horowitz and invests in consumer technology like social media, marketplace, entertainment and gaming. Moreover, Andrew is a prolific writer and a leading speaker on mobile, metrics and user growth. He is the instructor and board member of Reforge, which offers selective growth-focused programs for professionals in the marketing, product and engineering field. Andrew is a writer and has written "The Cold Start Problem" for business start-ups.


Is the Book about Health Tech Industry Workers?

 Well, I was also looking for examples of the health tech start-ups, industries and insurance sectors as these are the rare examples that are shared or discussed nowadays. Besides this, I was expecting day-to-day working practices in tech start-ups like new ideas, growth through hacks, performance marketing and network marketing. These all play a vital role in establishing a new business.

Andrew is known for his grip on his subjects and I personally liked the stories but most of these I had read previously on his blogs or at some other platforms. Well, I did not find any health-tech start-up examples indeed. So the book is for everyone who has to identify the solutions for tech startups.

I guess that the examples which were used in the book are usual and are about a handful of companies. Most of the examples and the stories are about social media or Airbnb platforms, as they have a strong network. I feel that Andrew has used these examples because there are good stories from the people who are in his network, but he has used them repetitively.


What do I Like in the Book?

I read the book and discovered a couple of good and worthy insights. The idea of network effects and the policies to offer specific features to the customers to resolve their issues and to build their interest for the network benefit is the prime element of the book. 

Another aspect that I liked is a timeline and yearly growth from start-up to IPO along with the general framework. So this can provide you with a vague idea about generating the revenues of 200$ M per annum as a recurring revenue over 10 years. This idea is useful to generate the funds and proves like the rule of thumb.

However there are not many good insights, if you read the tech start-ups' blogs regularly then you would not find anything fascinating in the book. So the book is good for those who have plans to indulge in tech start-ups by creating a strong network. In short “The Cold Start Problem” is informative for those who are looking for opportunities to invest the sums in this industry.


Andrew Chen


Who Can be the Readers?

Well, the book is good for those who have not read the blogs of Andrew Chen on tech startup ideas. The audience who have not read any blog or content on this topic earlier can read the book and I am sure you will find some good points and insights about tech start-ups. The book is particularly not for those who are from the health tech industry rather anyone who has entrepreneur plans can read it. You will probably find some good insights and ideas. 

Thus the Book has many informative insights about start-ups and is an exhaustive read as there are many theories and useful network-related information. You can surely get knowledge about tech start-ups from it. 


Valuable Take Away

The book has great ideas about atomic networks and the smallest self-sustaining version of products. It will help you in learning what to do or what not to do. In other words, the book helps you in revealing the aspects of the network’s strength, building strategy and density.

The case studies about Uber and Google are the best insights to learn about the network strategy and explain the defensibility of the large companies versus start-ups. 


The Final Say

Throughout “The Cold Start Problem”, I discovered the role of monetary incentives and network creation in a start-up. The book has many informative and inspiring stories about Uber and many more ventures. You would like the book if you have an interest in investing your sums in tech start-ups. This will provide you with information about the pros and cons of initiating entrepreneurship. With this, the writing style made it a great read. It is a combo of information, delivery is light and interlaced with funny excellent tech trivia. 

Did you know that YouTube was started as a dating channel or Instagram had just thirteen employees when it started? Excited? The Books have such information for you, so go for it!

Andrew Chen makes a perfect balance between storytelling and theory. In other words, the book is in the first person as your friend is telling or sharing his memories or ideas with you. Still, there are some unanswered aspects such as what Uber had done ultimately with its business practices and why the monetary incentives are the tipping point. 

Tech start-ups and artificial intelligence are not away from each other as AI plays a vital role in software and technical system setups. You can also refer to Atlas of AI: A Guide to the unspoken side of artificial intelligence. As this will provide you with a brief about the technical aspects of starting a venture.

In other words, the book is a combination of some interesting and enticing information about great startups. If you want to explore the journey of an entrepreneur in a tech start-up, the Book is for you! 

Read it and find an enormous set of examples of the best tech start-ups. 


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A keen observer, who loves to spend time with nature. A fun loving person, enjoys to explore the new aspects of life. Passionate about reading and learning new things. Roshni is dedicated towards her work and has worked in different professions.