Hamilton Helmer: evaluation

Transcript context

…Are you not including counter positioning here because it's hard to find a second business under a counter positioning umbrella? Let me just weigh in here a sec. I agree with her leaving off because to have power, you have to have it versus all potential and existing competitors. The counter positioning one is typically the type of power that you would have against incumbents, but it doesn't work against wannabes because they don't have the same problems. The one that you have to think hardest about is versus other companies that are doing it just like you. For Bowmar, it would be Texas Instruments doing calculators. That's why she left it off the list. Yeah. Regardless of what's the core power prospect, and we're calling a prospect because it has a pretty hard bar to clear, but even if you're still in the make for you, and you think this is going to be the mechanism that protects you from competition in long run, the first step is always to get a really clear understanding of what that core business power prospect looks like. Back to your example of Uber, if the core power prospect of Uber is actually scale economies which says, the technology framework of doing the matching automatically is so hard and it acquires so much cost to build, then international expansion would have been totally irrational because you're just spreading that fixed cost over more geographies, and you're getting a head start in every single place you have. But the truth is, it's not. The majority of cost of that business actually lies in acquiring and maintaining their customers, which means if anything, the route you should really try to get to is network economies, if you have one. The scope of that network that defines each market is actually heavily bounded geographically. Every new country, even new city that you go into is a complete new business and have to start from scratch. That's just an example of getting a definitive answer or a confident answer about what your core business power looks like. It gives you a very different place to look on where to transform or where to take it to the next step for your business.…

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