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Updated 30 Sep 2020

Swopinfo is harnessing the power of The network effect

A local start-up aims to harness the power of the network effect to create a new platform essential to local business owners, professionals and organisations. 

Nadine Todd, Entrepreneur, 17 December 2016  Share  0 comments  Print

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Vital stats

  • Players: Gavin Simoen and Dr Fred Tyler
  • Company: Swopinfo
  • Current territories: Russia, China, Honduras, UK, US and South Africa
  • What they do: Online business, marketing, file storage and networking platform.
  • Launched: 2015
  • Visit:

Despite its power in the digital age, the network effect is not new. Consider the telephone. The real value of Alexander Graham Bell’s invention came as more and more households owned phones.

Each phone added to the network made the whole network more valuable because the reach of each individual phone was that much larger.

But the network effect in action has never been clearer than with social media sites like Facebook and Twitter. When Mark Zuckerberg created Facebook, he instinctively understood that the more people who joined the platform, the more valuable it would become to its current users.

In other words, when a network effect is present, the value of the product or service is dependent on the number of people using it.

Local entrepreneurs Gavin Simoen and Dr Fred Tyler are building their start-up, Swopinfo, with the network effect firmly in mind.

Related: 8 Quick tips to maximise your networking skills

A platform that successfully taps into the network effect has two inherent values: Users derive value from the use of the product, and they derive value from other people’s use of the product.

Unlocking value

In order to create a community of Swopinfo users, Simoen and Tyler first needed to create a platform that adds value to its users, despite how many other people are on the platform. They then needed to build the importance of sharing the platform into the business model. The more people on the platform, the more valuable it becomes — but you have to give people a reason to be there.

In an age where there’s not only an app for that, but a platform as well, the entrepreneurs wanted to create something that solved some of their personal pain points, but also became a valuable business model.

“As an urologist who speaks at hundreds of conferences and has thousands of presentations stored on hard-drives, I needed a secure space where I could store my presentations in the cloud, but also give others easy access to them,” says Tyler.

Google docs, dropbox and iCloud are all online storage facilities, but you’re not just going to give anyone access to your data. These are personal file storage sites.

“This was the seed that became Swopinfo,” says Simoen. “We wanted to create a file sharing site that was completely secure, would upload all normal formats, and allow others to see, view or download your documents without having access to your private account. As the account holder, you can choose which files are available for public viewing, which can be downloaded, shared, reviewed and so on.”

As the idea developed though, Simoen and Tyler began working on the business model. They wanted to create a site that had unlimited (or at least a very large capacity cap), and that was free, or as close to it as possible. This meant the idea needed to be monetised in another way.

Related: 5 Rookie networking fails and how to avoid them

Finding the money

Gavin -Simoen -and -Dr -Fred -Tyler -swapinfo

A captive audience is extremely valuable from an advertising perspective, particularly if you’re able to segment that audience even further. Targeted and niche advertising is becoming the way of the future, and platforms that can offer that to advertisers are golden.

Geo-location technology means that Simoen and Tyler can then sell advertising that targets users by their geographic locations, interests and businesses.

Getting everyone on board

In order for any of this to work though, the networking effect is vital. As the concept has developed, and Simoen and Tyler have conducted hours and hours of exhaustive online research, the capabilities of the platform have grown.

“We realised that businesses and individuals need a way to market online through content sharing that is targeted, specific and valuable to their clients. If you can do everything from one platform, then that platform not only becomes integral to your business, but it becomes an online business community where users can cross-sell, support each other and invite other members into the community.

“Our research found a number of tools focused on new business acquisition, but nothing that actively supports businesses to look after and communicate with their current client bases,” says Simoen. “We’ve therefore focused on shaping our platform into an interactive remarketing tool.”

Swopinfo has three channels: Personal, business and conferencing capabilities that include a live streaming function.

“Businesses pay a minimal annual fee that allows them to open a business profile, link to all other social media sites, upload catalogues, marketing material, videos, brochures and digital business cards, all in one place, and all sharable at the click of a button.”

This functionality means that businesses are encouraged to invite clients and suppliers to follow them, so that they can easily share content with them.

“We’ve created an opportunity to actively market your products to your followers. In addition, you can go into your profile, manage information, share it and push it via other platforms into a time-line based medium.”

For example, if you own student accommodation and you’re targeting students in July who are starting six-month courses, you can create a package outlining your offering. It includes a video presentation, a pamphlet, some referrals, and you can send out a targeted campaign to student sites and social media sites with specific hashtags. Anyone interested can then find all that information on one platform, without having to Google it.

“There are a trillion websites and only ten spots on Google’s first page. This eliminates the need for excellent SEO.”

Sales executives can use the platform in a similar way. As they grow their personal databases, they can send product updates, specials and targeted content marketing to their clients. People can also create closed groups to share files, for example, recipe groups or arts and crafts circles, and self-publish downloadable books for free.

“We believe this is the future of trade,” says Tyler. “In ten years’ time, everyone will be trading from one platform. You need to be able to interact with clients, accept payments, and share information from one place.

“We’ve focused on high functionality on a simple-to-use platform. You can send a presentation to your phone via whatsapp, and then play it through a mini-projector. “We want our platform to be an invaluable tool that you share with everyone.”

Related: How to improve your NETT worth during networking

The power of a network

Swopinfo -logo

Ultimately however, the platform only works if enough users are on the site, and so their core focus, over and above developing functionality, has been to get people to join Swopinfo.

To help spread the word, Simoen and Tyler have created a network of agents who can recruit and train users so that they get the full benefit of the site’s functionality.

“Agents teach people how to use our platform in exchange for a great commission. We understand that the more businesses and individuals understand how to use the platform, the more likely they are to use it and stay on the site, get the benefits and attract others onto the site.”

Simoen and Tyler are offering the platform for free for educational purposes as well — users just need to register to download the information.

“We want the whole world on our platform eventually. We believe that there are two key components to achieving this aim: A platform that offers real value to business owners, and a business model that requires users to sign up before they can engage with each other, download information or use the storage facilities.”

Do this

Understand where the value in your business idea lies, and then create a business model designed to unlock that value. What will customers pay for? And who needs to use your product to make it valuable?

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About the author

Nadine Todd, Entrepreneur

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