Tip 8: Know and Build your Barriers to entry
Whenever you decide to launch your product or service to a market, you need to be well-aware of what might be your challenges and how you’re planning to overcome them. Some strong barriers to entry include:
• Scale/Volume, the only way to compete is to produce more;
• Network effects, a strong value added two sided marketplace;
• Complexity without either in IP, technology, operations;
• Regulation, licences can bar new entrants;
• Partnerships, especially distribution licenses, may prove hard to compete against.
Once you’ve prepared a plan on how you’re going to deal with the most likely barriers to enter a market for your startup, your startup is more likely to receive a positive reaction by investors.