A tweet by Hirata-san prompted me to write down my current thinking on moats.
The tweet immediately reminded me of something Kanmu CEO Yamaki-san wrote: "the strength of a barrier to entry can be defined by two variables — time and cost." His thread is worth reading in full.
It also reminded me of a piece by DCM Ventures' Hara-san, which goes into this from an investor's perspective.
A brief aside:
Since Hara-san reached out and we first met in 2018, I feel like we've been climbing the startup ladder together. At every funding round, the question he kept asking me was: "What's the moat?" Thinking through that question exercised me across every dimension — as a product manager, as a BizDev person, as an org builder, as an operator, as a CEO, as an entrepreneur. That's a story worth telling in full someday.
End aside.
My Thinking on Moats
Back to the core question. The necessity of a moat is no longer debatable. A startup isn't a product-building game. It's a game where the rule is: build a business that scales over the long term with both durability and novelty. Under those rules, building a moat is mandatory.
And as Hara-san's piece describes, a moat is always a complex combination of multiple elements — no business can summarize it in a single word.
For Stailer, what are those elements? Partner network, system network effects, cost advantages, capital depth, user distribution — several candidates come to mind. But which one is "the" moat? I can't give a clean answer.
I also agree with Yamaki-san's framing that a moat ultimately manifests as an entry cost — "X billion dollars, Y years." But I want to add one concept on top of that: the golden window.
In every business, when you enter the market is a major determinant of success. Consider this: if you brought a fully self-driving electric car to the Japanese market today, in 2021, you'd probably see much less growth than expected. Not because the product isn't good — but because the regulatory environment and infrastructure aren't ready. You can't catch the wave. These are technologies and products that will absolutely come and become normal. But the window in which you can bet on them and actually grow is limited. Enter too early and you burn through resources; enter too late and the available share is small.
The golden window: a limited time window in which high growth and high market share are simultaneously achievable at the moment of entry. No product can capture much value if it misses that window, regardless of quality.
This changes how I think about moats. A moat cannot prevent entry. Given enough money and time, any moat can be replicated. Starting from that premise, the true purpose of a moat is not to stop competition — it's to push competitive entry as far away from the golden window as possible. The key variable is timing.
When should you build a moat? How large does it need to be? What does the right "cost to enter" look like for the timing you're targeting? How much stealth preparation should you do before going to market? These are the questions I find important right now. And this thinking will continue to evolve.
Moats are not just a topic for executives — they're a critically important framework for product managers, corporate strategists, and many other roles. I hope this piece can be useful in those conversations.
