The answer: Flywheels
Flywheels, in the context of product and business, are when “Thing A” encourages/drives “Thing B” that then, in turn, drives “Thing A”. Around and around, faster and faster.
A common and basic example of a Flywheel is the following phenomena on Facebook: Users on FB invite other users which, in turn, makes FB more useful, which then encourages more users to join Facebook.
Flywheels create acceleration and defensibility in your business. If they gather enough momentum, they make your business unstoppable. So, as you can imagine, they are a pattern that many product managers and startup founders try very hard to create.
Flywheels should...
Be built into your core product user experience
Be designed around an interaction model whereby the more users use your product, the better your product becomes to use
Feel like a natural part of the primary utility of your product
To do this your product will likely need to...
Work very well in 'single-player mode'. This is important to overcome cold-start bootstrap problems
Have a compelling 'multi-player mode' that feels like a natural and powerful part of the primary purpose of the product
Offer incredibly easy ways to invite friends or colleagues
Provide an incredibly easy and slippery onboarding funnel for invited users
A good counter-example of an effective Flywheel is offering users a discount code to share with friends or colleagues. This is not organic to the core utility of your product, nor does it make the experience better for either user. Another good counter-example is manual business development or sales activities. These are not deeply built into your product and are therefore too slow and cumbersome to scale.