Instead of trying to convert skeptics, AMP focuses exclusively on users already at the frontier of AI adoption. They believe that building for someone who doesn't know how to prompt well forces them to build simplistic features and fall behind the pace of innovation.

Fal strategically chose not to compete in LLM inference against giants like OpenAI and Google. Instead, they focused on the "net new market" of generative media (images, video), allowing them to become a leader in a fast-growing, less contested space.

Contrary to fears, AI surpassing human ability has fueled chess's popularity. AI engines are used as personalized coaches in products like Chess.com, analyzing games and helping millions of users learn and improve, making the game more accessible.

Don't fight battles you can't win. For a product like Evernote, competing with free, pre-installed apps like Apple Notes for casual users is a losing proposition. The winning strategy is to focus on the advanced user segment whose complex needs justify paying for a more powerful tool.

IBKR's low-cost, tech-first model is strategically counter-positioned against high-touch incumbents like Charles Schwab. Adopting IBKR's model would require competitors to cannibalize their profitable existing business models, creating a powerful competitive moat based on the innovator's dilemma.

Large platforms focus on massive opportunities right in front of them ('gold bricks at their feet'). They consciously ignore even valuable markets that require more effort ('gold bricks 100 feet away'). This strategic neglect creates defensible spaces for startups in those niche areas.

While often cited as a weakness, Interactive Brokers' complex user interface effectively filters out casual traders. This self-selection attracts sophisticated, high-value customers who prioritize low costs and advanced functionality over a slick user experience, creating a more durable client base.

Don't start with a broad market. Instead, find a niche group with a strong identity (e.g., collectors, churchgoers) that has a recurring, high-stakes problem needing an urgent solution. AI is particularly effective at solving these 'nerve' problems.

Top compounders intentionally target and dominate small, slow-growing niche markets. These markets are unattractive to large private equity firms, allowing the compounder to build a durable competitive advantage and pricing power with little interference from deep-pocketed rivals.