Stop trying to predict future trends. Instead, double down on the things that will remain constant over time.

A company’s competitive edge always comes from investing in permanent advantages, not in the latest AI trend.

To understand what this means, let’s take a look at a company like Amazon. There are only a few things that will remain true forever in their business.

For example, their customers will always want:

1. Low prices
2. Fast delivery
3. A vast selection of products

This thought exercise reveals something important. It uncovers the areas of the
business that will keep paying dividends 10 years from now.

It is hard to imagine a future for Amazon in which the opposite will be true. Their
customers will never want higher prices, slower delivery, nor a limited selection of
products.

What does this mean for investors and founders?

The unfortunate reality is that founders often waste months building products nobody wants.

Think about 5 startup companies started in the last 10 years. Which ones have failed and which ones have made it?

You will start noticing that a startup is most likely to succeed when it focuses on making existing behaviors more efficient rather than creating new desires.

This is what eventually translates into a permanent advantage for any company.

How do you identify the permanent advantages of a business?

There are only 4 ways a company can make an existing behavior more efficient:

1. Cost: make it cheaper
2. Complexity: make it simpler
3. Effort: make it easier
4. Time: make it faster

Once you have figured this out, you’ve solved half of the puzzle. The second half is
ensuring customers actually care about the dimension being improved. People need a compelling reason to use and pay for the product (or service).

For example, if we apply this filter to businesses we all know of today, this is what we get:

● Netflix: Offers cheap access to movies and tv shows (cost)
● Airbnb: Makes travel simpler by providing thousands of options for your stay
(complexity)
● Uber: Makes it easy and convenient to book rides (effort)
● Canva: Helps businesses create graphics and marketing materials fast (time)

Try this exercise yourself, and hopefully, this will help you identify whether an
opportunity is worth pursuing or not.