Here's something nobody tells you about the counterintuitive truth about building a moat in: the conventional wisdom is mostly backwards.
In an age where AI models are commoditized, how do you build a real, defensible moat for your SaaS business? I'll share the counterintuitive truth about where long-term value is created, and it has nothing to do with having the 'best' algorithm or the most data.
The Reality Nobody Talks About
Most people approach the counterintuitive truth about building a moat in with assumptions that made sense five years ago. The world has moved on. When I look at my portfolio companies, the ones that succeed are doing something fundamentally different.
The first thing to understand is that most founders overthink this and underspend on execution. I've seen this play out across dozens of companies. The pattern is unmistakable.
At RemoteTeam, we learned this the hard way. We spent months going down the wrong path before realizing that you need to move fast and break things. Once we made the switch, everything changed.
The Framework That Actually Works
I'm going to share the exact framework I use when evaluating the counterintuitive truth about building a moat in. It's not complicated, but it requires discipline.
Step 1: most founders overthink this and underspend on execution This is where most people go wrong. They skip this step entirely and jump straight to execution. Don't do that.
Step 2: simplicity beats complexity every time Once you have the foundation right, this becomes much easier. I've watched founders struggle with this for months when the answer was staring them in the face.
Step 3: Iterate relentlessly Nothing works perfectly the first time. The companies in my portfolio that nail the counterintuitive truth about building a moat in are the ones that treat it as an ongoing process, not a one-time project.
The Counterintuitive Truth
Here's what surprised me most about the counterintuitive truth about building a moat in: the best practitioners do less, not more.
When I was building MovieLaLa, we tried to do everything at once. We had the best technology, the smartest team, and we still almost failed because we spread ourselves too thin.
The lesson I took from that experience, and from watching hundreds of other companies, is that the best solutions are often the simplest ones. It sounds simple. It's incredibly hard to execute.
What I Tell Founders
When a founder in my portfolio asks me about the counterintuitive truth about building a moat in, I usually start with three questions:
- What's your timeline? Because the right approach for a company with 6 months of runway is very different from one with 3 years.
- What have you already tried? Most founders have tried something. Understanding what didn't work is often more valuable than knowing what might.
- Who on your team owns this? If the answer is "everyone" or "no one," that's your first problem to solve.
These questions seem simple but they reveal a lot about where a company actually stands.
This connects to broader themes around AI pricing models, usage-based pricing, SaaS metrics that I've been thinking about a lot lately.
Wrapping Up
I've shared a lot here, and I know it can feel overwhelming. But here's the thing about the counterintuitive truth about building a moat in: you don't need to get everything right on day one. You just need to get started and keep improving.
The founders in my portfolio who excel at the counterintuitive truth about building a moat in share one trait: they're relentlessly practical. They don't chase perfection. They chase progress.
That's the mindset I'd encourage you to adopt. Start where you are. Use what you have. Do what you can. And keep pushing forward.
As always, I'm rooting for you.
Frequently Asked Questions
How can I apply this thinking to my own situation?
Start by identifying the core principle behind the opinion, not the specific example. Then ask yourself: does this principle apply to my context? If yes, test it in a small, low-risk way before going all in.
What's the most common pushback you get on this?
People often push back by citing exceptions or edge cases. And they're usually right that exceptions exist. But building a strategy around exceptions rather than patterns is a losing game for most founders.
Do all experts agree with this view?
No, and that's fine. The best ideas in business are often contrarian. I share my perspective based on my experience and data, but I encourage you to seek out opposing viewpoints and form your own conclusions.
What experience informs this perspective?
This perspective comes from over a decade of building companies in Silicon Valley, two successful exits (RemoteTeam to Gusto, MovieLaLa to Gfycat), and investing in 200+ startups including Anthropic, OpenAI, and Scale AI. I write about what I've lived.