Step 3: Design the Catalyst for Success

The decision of customers to participate in a catalyst business will depend in large measure on how well you can attract them and how easy and alluring it is to join.

Whether physical or virtual, the place where customers meet must be safe, secure, easy to reach, and easy to navigate.

More importantly, successful platforms compel the distinct groups of customers to interact with each other.

• Attract multiple customer groups that need each other
• Promote interactions
• Minimize transaction costs
• Design for evolution

» For more on designing a catalyst for success, visit Chapter 5.

Bungalow 8:
The Power of a Network

Amy Sacco has mastered the art of catalyst product design. Bungalow 8 has a capacity of only 125 people, so Sacco has to ensure that only the “right” people enter. This she does mostly through her proxy, an enormous doorman who only allows the very rich, the very famous, the very beautiful, and the very powerful to enter. Once in, this community of “it” people happily pay US$1,200 for caviar and US$50 for a cocktail just to rub shoulders with others just as rich, powerful, famous, and beautiful.

Sacco not only has designed an attractive meeting place—Bungalow 8 is supposed to feel like the old Beverly Hills Hotel—but has used her network to ignite the catalytic reaction that has given the club its hip reputation and an enormously long life in an environment where clubs often come and go in a matter of weeks. “It’s all about building up your network,” Sacco explains. “Every time I meet someone who I think is cool or cute, I get their card.” Her Rolodex is probably one of the most coveted in town. And now so is her club.