Idea in Brief
The Challenge
It’s easier for digital platforms to achieve scale than to maintain it.
The Reason
Five basic network properties shape their scalability, profitability, and ultimately their sustainability.
The Insight
Analysis of these properties will help entrepreneurs and investors understand platforms’ prospects for long-term success.
In 2016, Didi became the world’s largest ride-sharing company, reaching 25 million trips a day in China and surpassing the combined daily trips of all other ride-sharing companies across the globe. It had arrived at this milestone by merging in 2015 with its domestic rival, Kuaidi, and pushing Uber out of the Chinese market after a fierce, expensive battle. With its competition gutted, Didi gradually began to improve its margins by reducing subsidies to drivers and passengers.