Hi there -
Here is this week’s “1 principle, 2 strategies, and 3 actionable tactics” for running lean…
1 Universal Principle
“Most things founders call ‘competitive advantages’ aren’t advantages at all.”
Steve’s VR platform for architects was thriving until major CAD players entered his space with 1000x his budget. His technology advantage vanished overnight. That’s when his mentor Mary introduced him to the 7 Sources of Power framework, transforming his vulnerable startup into a defensible business.
Here’s the expensive reality:
Being first, having better features, superior technology, or even a smarter team aren’t real competitive advantages - they all get copied or commoditized quickly.
2 Underlying Strategies at Play
I. Build Real Unfair Advantages
Focus on advantages that make it uneconomical for competitors to compete, or on structural positions that compound over time, creating bigger barriers to entry.
II. Pick One Power and Go All-In
Don’t try building all seven powers at once. Choose one that matches your product stage and business model, then focus entirely on developing it.
3 Actionable Tactics
I. Align Power with Business Model
Assess which of the 7 powers (Scale Economies, Network Effects, Counter-Positioning, Switching Costs, Branding, Cornered Resource, Process Power) naturally fits your business model.
II. Match Power to Product Stage
Consider your current stage - some advantages like brand require more time and resources. Early-stage startups might start with counter-positioning rather than competing head-on with incumbents.
III. Make Moat-Building a Side Effect
Like Steve did with his VR platform, couple your chosen power with your unique value proposition. He combined network effects with quick VR walkthroughs, making moat-building a natural byproduct of product development.
That’s all for today. See you next week.
Ash
Author of Running Lean and creator of Lean Canvas
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P.S.
If you haven't heard already, I’m launching LEANSpark - an AI agent that walks you through the same 7-dimension business model assessment I use with founders. This includes the defensibility stress test from today’s video, plus clarity, desirability, viability, feasibility, mission, and timing assessments.
The VIP coaching tier sold out in a week (all 10 spots filled). The Founding Cohort closes November 7.
Join me for the 13-week over-the-shoulder series where I’m building this live and get 3 months free when LEANSpark launches in January: https://leanspark.leanfoundry.com/
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P.P.S. Check out this week’s video: 7 Ways to Build a Market-Dominating Business
