Competitive Strategy

"I met the founder of Letterboxd and I realized, 'Oh my God, this is a business where this has a moat, so it has a network effect, it's a huge social network for film reviewers. It's something I'm passionate about and it's something that we can buy at a fair price.'"

"And so when you start to realize that, jobs helps you see the true competitive set from what we call the demand side of the world as opposed to the competitive set from the supply side of the world, which is the technology or the underlying business model by how which we're making it."

"Less than a year later, Google Photos launches. And not only does it provide a lot of the same value, but they also gave you free unlimited storage for life. And so, they just totally nuked our business model."

"At the earlier stage, you can imagine wildly more degrees of freedom and the questions are of the business propositions that you're thinking of in trying to get to product-market fit, what are the underlying characteristics that might tilt them towards the availability of power or not?"

"So in a book there's a thing called power progression, which says there are... It tells over the cycle of a business, there are times when certain types of power are available and the converse of that is times when they're not available."

"I see a lot of founders get this wrong and they prematurely will shut down a conversation or they won't talk to an incumbent or a potential future buyer because they take too competitive of a stance. But that's a mistake because M&A is all about creating plan Bs and you don't want to shut that door down prematurely because you don't know if you can really go the distance and be an independent company. So you want to have optionality."

"And my point in writing about David and Goliath was that the surprise that David is able to beat this giant warrior, and that's a strategy story. Strategy story is about discovered strength."

"Not every great thing is going to be invented by you. Facebook probably created the modern feed, but there's a feed for every single product. At the end of the day, you're just robbing your user base of the opportunity to have a better product."

"The core Google search isn't really changing, in my opinion. We're not seeing that people come to search for just ridiculously wide set of things. They want a specific phone number, they want a price for something, they want to get directions. I think the vastness of that is underappreciated by many people."

"You have to be either differentiated or low cost, there's no way to protect yourself if you're not one of those two."

"Perhaps the thing that makes it intellectually hardest is that it is an integrative activity. It answers to a bunch of questions that have to fit together and reinforce one another."

"So VSCode, which is a very popular IDE, had a ceiling for the AI capabilities, we could showcase our users. And because of that, we decided to go out and fork VSCode and build our own IDE with some of these new agentic capabilities."

"Every single day, every single time somebody is pushing your code to production and you're releasing a feature or an enhancement, you are making the product better or you're making the product worse, but the products never remain same. So with every release that your competitor is making and every release that you're making, you are either making chess points, moves against them, positive points, or you're going negative. I think that framework, it actually drives an insane amount of clarity in terms of what you're doing and what the impact is going to be."