[muhaaa]

Author writes that Atlassian has no network effects. That is BS.

Atlassian has massive network in its ecosystem. There are Jira Consultancies, 3rd party apps and plugins and deep integration into customers processes. If one element grows the whole ecosystem profits.

Secondly, Atlassian is not a bad company just because it's stock is overpriced. It might be a bad investment!

Over the short and midterm Atlassian is in some trouble because it has problems to scale the development while shifting from legacy to cloud. They will solve it. Still i expect some bad news to come.

These bad news will beat down the stock and maybe create an opportunity to buy a great company at a great price.

PS: The Atlassian invoice of my employer tripled over 1 year. You start cheap and simple and with every plugin and product you add the invoice grows. Thus to value Atlassian you have to look into revenue per customer over its life time, which is far greater than this year's revenue of the customer.

[gshulegaard]

I think you might be confusing upselling and cross selling with network effects. Upsell is when you convince a customer to purchase additional service, like offering different tiers of subscriptions. Cross selling is where you sell adjacent services related to (and that possibly integrate with) the original service.

Network effects are where the direct value of a product grows simply because the number of users increases, causing the network itself to grow. The classic example are social networks. The more people on your social network, the more people are likely to join your network and less likely to join a smaller competitor. I am not sure there is anything in Atlassian’s product offering that quite fits that description, but that isn’t to say there isn’t plenty of upsell and cross sell opportunity as you describe.

[muhaaa]

I disagree. A network effect does not need to be inherent to the product / service itself. It can originate from other sources. What is the network effect of eBay? As a seller I do not care how many other sellers are there. But I care how many buyers are there. For a buyer it's the reverse. Buyers attract sellers and vice versa. That's a network effect too. For Atlassian it's similar. Jira customer attract Jira consultants and vice versa.

Ecosystem is the better word for sure. it's competitive advantage is still a network effect.

[nashadelic]

Ebay has so many sellers because it has so many buyers; it has so many buyers because it has so many sellers.

That’s the network effect