Barriers to Entry: The Moats Around a Business
Barriers to entry are the 'cover charge' for a market that new players must pay, but incumbents didn't. They're the moats protecting a business, seen in regulated industries or with strong brand loyalty.
Barriers to entry are fixed costs a new company must pay to enter a market that incumbents avoided, acting as a defensive moat. They protect existing businesses, restrict competition, and can lead to monopolies. These barriers can be government-created (like banking licenses), natural (like brand loyalty), or due to resource scarcity. The main footgun is confusing high startup costs with a true barrier; if incumbents also paid that cost, it's just the price of admission, not a structural advantage.
Read the original → Wikipedia: Barriers to entry
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