What are you building? Remember: firms win by accumulating capabilities. From Google to Amazon, from Dangote Group to Indomie Noodles’ parent company, when companies accumulate capabilities, they operate in domains that generate higher value (usually upstream) compared with where most firms operate (usually downstream). Dangote Group can deploy massive assets and technical know-how in cement production, making it harder for new entrants and rivals.
JP Morgan has a balance sheet that is a “fortress” which means it is impenetrable and cannot fail. In other words, it has accumulated asset classes and clusters of resources that this bank can operate in ways no other global bank can.
When companies accumulate capabilities, they move to become category-kings which dominate their market and territories, through asymmetric competitive advantages on factors of production they have access to and utilize.
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In this video, I explain how we can begin small (at the downstream level) and then transition to the upstream where more value is found in markets. It is about visioning and pursuing the best way to fix frictions in markets.
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You distinguish yourself by venturing and succeeding in uncommon things, but if you keep playing where everyone else is playing, you remain ordinary, and you are never going to enjoy any preferential treatment.