TL;DR: Network density beats total size. 2,000 users in one city > 100,000 scattered across 50 cities. Dense networks actually deliver value; sparse ones don’t.
A dense network creates context. People know each other, messages get seen, transactions happen fast. A sparse network is noise—users exist in isolation, no network effects fire, churn is inevitable.
This is why cold-start strategies obsess over a single geographic or tribal neighborhood. You build density first, prove network effects work locally, then expand. Trying to grow evenly across ten markets gives you zero density anywhere. (atomic-network, cold-start-problem)