While most tech giants focus on the digital world of "bits," Amazon's true dominance comes from its mastery of the physical world of "atoms." Its massive, hard-to-replicate logistics infrastructure for moving goods creates a formidable competitive advantage that software-only companies cannot challenge.

In markets with poor infrastructure, such as Southeast Asia's incomplete address systems, building proprietary logistics is a key differentiator. Sea assigned its best talent to solve this "hard problem," creating a sustainable advantage over competitors by owning the customer experience from click to delivery.

While AI agents could shift sales away from traditional retailers, companies with extensive physical infrastructure and forward-positioned inventory have a defense. AI agents prioritizing speed and efficiency for physical goods will likely still favor these established networks, preventing full disintermediation in the new agentic commerce landscape.

MercadoLibre built its payment system, MercadoPago, out of necessity in a market lacking a trusted digital payment solution. This created a powerful, integrated commerce and payments flywheel that fueled adoption and established a moat that competitors like Amazon struggled to overcome.

No other publicly traded company has matched MercadoLibre's record of 27 consecutive quarters with over 30% top-line growth. This unparalleled consistency, driven by deep market dominance and secular tailwinds in Latin America, signals a unique investment opportunity.

The company's declining operating margins post-2017 were not a sign of weakness but a deliberate strategy. Management aggressively reinvested profits into logistics and payments, temporarily compressing margins to solidify long-term market dominance and build a powerful competitive moat.

While competitors viewed capital as a strategic weapon, DoorDash focused on capital efficiency. Their goal was to be twice as effective with every dollar spent on customer acquisition. Lin emphasizes that capital is fuel, but it's useless without a 'fire burning'—a product with real engagement.

To avoid being disintermediated by AI agents that could direct consumers elsewhere, retailers can leverage their physical assets. An AI agent will still prioritize retailers with extensive infrastructure and forward-positioned inventory to ensure fast and efficient delivery, creating a competitive moat against pure-play e-commerce.

Flexport's AI optimization models achieved a rare win-win: making ocean shipping both 20% faster and 2% cheaper. This defies the conventional logistics trade-off where speed costs more. The AI constantly re-optimizes container placements, a task humans cannot do at scale, particularly for cancelled shipments.