When we talk about innovation there is a single symbol recognized throughout the whole world that appears in people's heads: the light bulb. Our journey into the world of platforms as a tool for innovation starts right from the light bulb, or rather from its inventor: Thomas Edison. Thomas Alva Edison was an American inventor described as the America's greatest inventor ever. He developed many devices in fields such as electric power, mass communication, sound recording, and motion pictures. Still, he is mainly famous for the invention of the early version of the electric light bulb, and for its impacts on the modern industrialized world. What you may not know is that Edison was not only a great inventor, but he also became a great entrepreneur over the years, founding 14 companies including General Electric. At the end of the 19th century, Edison was working on the Edison Lamp Company and a few years later J. P. Morgan participated in financing Edison's research by merging a series of small companies into the Edison General Electric Company. Over the years the name became simply General Electric and the business diversified significantly. GE is one of the first 12 companies to enter the Dow Jones index of the New York Stock Exchange. The incredible growth of this company caused it to enter many other industries such as aviation, healthcare, energy, television, manufacturing, venture capitalism and many others. In all of these cases, GE grew primarily through acquisitions, using its FINANCIAL STRENGTH to enter new businesses where synergy with existing businesses was virtually zero. In its history, GE has been many times the company with the highest market capitalization, most recently in 2005. Since then, things in the business world have changed. Or rather, the growth of companies has started to take a very different shape. To understand what I mean, let's try to follow the story of one of the great giants of the 2000s: Amazon. Jeff Bezos founded Amazon in his garage in Bellevue, Washington on July 5, 1994. The idea was simple: to buy huge warehouses in areas where land was cheap, to be able to create the largest book warehouse in the world and offer - through the nascent spread of the Internet - the possibility for anyone to order any book on the market. Even all those titles that sell too little to be kept in stock by a small country bookstore, but also by the big stores in the city center. Amazon was born, a digital service that allows you to have all your books at home...from A to Z, with a simple click on a website. Amazon's strength lies in its ability to evolve, continuously, to become something different. A few years after the launch, they realize that in addition to books, other types of goods could benefit from a similar approach, such as VHS, soon transformed in DVDs and CDs. The business began to expand, leveraging the assets and skills they developed for book sales: great logistics expertise and the ability to delight the end customer. Hence the big insight: what if instead of selling books, CDs and DVDs, we started selling our true expertise? The logistical ability to quickly deliver physical goods around the United States of America? Amazon Marketplace was born, the transformation of Amazon into a true platform that allows a transaction between the end user and anyone who wants to sell online. From there, Amazon's evolution as a platform has never stopped, developing new services and identifying assets within the company to make them real. I'm talking about services like cloud computing, like Amazon Mechanical Turk, purchase recommendation and many more. Amazon, in the span of less than twenty years has gone from being a startup in a garage near Washington to a global super-giant, surpassing Walmart – the greatest American retailer - in 2015 in terms of capitalization. What’s the kick? What is the big difference between GE and Amazon? While both have been able to leverage a financial capacity with few equals, Amazon has been able to put the platform concept at the center of its growth and innovation strategy. GE was great in growing by expanding in adjacent businesses or even in far away ones, using some basic assets as a common tool (capital, engineering capabilities, knowledge of international markets). On the other hand, Amazon transformed all the industries it entered replicating again and again the same basic idea: matching economic actors who wanted to be matched Amazon is one of the BIG Five or Tech Giants of the US along with Alphabet, Apple, Microsoft and Google. In different ways, which we will see throughout the MOOC, these five companies have opened the door to the platform revolution, proposing a new way of creating value, less linear but faster in terms of scalability and possible expansion. I'm referring to the proliferation of small companies that - starting from the second decade of the 21st century - have been able to establish themselves in traditional markets by appearing almost out of nowhere and reaching a size useful to challenge the industry incumbents by leveraging the simplest and purest version of the logic that the Big Five used to grow and achieve their status. One example? Let's enter the world of accommodations and try to briefly retrace the history of Starwood, one of the world's most important players in the hotel sector. Starwood Hotels and Resorts was originally founded in 1969 by the real estate investment firm Starwood Capital to take advantage of a tax break; at the time the company was known as Starwood Lodging. Initially, Starwood Lodging owned a number of hotels throughout North America, all under different brand names. In 2016, the firm was acquired by Marriott International for 13.6 billion dollars, having more than 1.200 properties spread all over the world and more than 180.000 employees. Let's compare it to the platform that disrupted the accomodation world in the digital age. In 2008, Brian Chesky, Joe Gebbia and Nathan Blecharczyk founded Airbnb in San Francisco. The idea was simple: through their platform, anyone with free space can offer a place to sleep and anyone who wants a way to see the city from the eyes of a person who lives there, or simply wants to spend less than in a hotel, could do so. Anyone can become a hotelier. In 8 years, to compare it with Starwood in 2016, Airbnb surpasses 4 million properties available on the platform, with an evaluation close to $30 billion....with only 3,000 employees. The comparison with Starwood tells us that we are studying companies that are based on completely different logics. The world has changed completely and we are in need of new models, new theories and new tools to understand and surf the world of platforms. Over the years, in addition to the most emblazoned Big Five, and also in addition to successful platforms like Airbnb, Uber, Spotify or Netflix, we have seen thousands of platforms born, grow and spread around the world in almost any industry. And looking at the Unicorns’ club, the set of start-ups that have at least 1 billion evaluation through private funds, the incidence of platform businesses is extremely high. In many cases, innovators or entrepreneurs acted primarily by replication trying to bring Airbnb or Uber to another industry. In some cases successfully....in others with significantly less luck. Replicating a model can be simple, understanding it completely and knowing how to leverage it...much less. For this reason, we believe that the potential for platform innovation is hidden into the eyes of the innovator, who is able to understand how to create a platform and above all how to make it evolve over time. Just like Amazon did in the story told earlier. This is what we will try to do in this course: study platforms to understand them not only as a business model, but as a lens through which to make innovation in any sector.
