If you are growing your business for sale or you're an early stage start-up seeking funding, one question that you will likely hear is:
"What's your moat?"You might not hear it phrased exactly like that but the clue should be in the question.
Moat - a deep, wide ditch surrounding a castle, fort, or town, typically filled with water and intended as a defence against attack. - Dictionary definitionSo in plain English: What is it that your business has that stops someone else from (quickly) copying you?
It is important to have a think about this in any business. For some it will be straightforward, for example, some core technology for which they have a registered patent. Others might have a unique process that is secret.
There might be a whole host of different variables but you should be looking at ways that might stop "copy-cats" stepping in to profit off your initial advances.
If you want to fetch a decent valuation on your business then your "moat" will likely be one important variable that will be taken into account.
Have a think about it and be prepared to answer that question with the widest and deepest moat that you possibly can!
Posted from my blog with SteemPress : https://businessn2k.com/whats-your-moat/
Hi, Steve. I'm new in this network and right now I'm building my own eyewear brand in the Venezuelan market (hoping to make it reach the worldwide market soon). I've been wondering about that exact matter and how to apply it on my brand.
There are a LOT of different eyewear brands across the world and in fact, the whole market is owned by only two major companies, but every now and then there always appears a new startup or brand that makes it and reach a pretty good level against then and the only thing that they actually show up to be different is their aproach or business model. This is beacuse (if you think about it) no one is actually inventing something new in this area.
My eyewear brand is taking a "new" (it is widely used all around the world right now) aproach by using organic materials such as wood, stone and many others, and it is working on my country, butnow that we want to go out to the world, i think that it is not that special. If you were in my position, what would you do? (I now it is imposible for you to give me the answer, but I rather ask, than stay quiet on this matter).
Thanks anyway!
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Thank you for such a detailed comment.
As you say, it's difficult for me to comment on specifics but it sounds like you are aware of the need both to position and protect your company in terms of having a moat - which is half the battle! Your brand alone might become a moat if you can get it right....
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The best moat may be the individual himself. Elon Musk is one big moat on himself. He can make things happen and the world knows if musk is involved then things get done. (Maybe late but they get done)
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Hi Steve. Your moat is the real value of the business. The more different your business is the better.
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