What makes you hard to beat?
It’s that special thing your customers love but your competitors can’t quite copy.
Take Apple, for example. Their big advantage is how all their devices and services work perfectly together. Whether it’s an iPhone, iPad, Mac, Apple Watch, or services like iCloud and Apple Music, everything connects seamlessly. Once you own one Apple product, it’s super easy to add more, and that makes it tough to switch to other brands.
Apple’s strength comes from how all their products and services enhance each other, making life more convenient for their users. This strong connection between their products creates a big barrier that’s hard for other tech companies to overcome, helping Apple stay on top.
And this idea doesn’t just apply to big companies like Apple. We call this a “moat.”
So, what’s a moat? Think of a castle surrounded by water. The water (or moat) protects the castle from attackers. In business, a moat is something unique that protects your company from competitors. It could be a strong brand, a large customer base, or something special about how your products work together. A good moat makes it hard for others to take away your customers or copy what you’re doing.
A moat can make your business much more valuable. Research from The Value Builder System™ shows that companies with a strong moat are 40% more likely to get offers to buy them out, and those offers are usually 25% higher than for businesses without one.
How Boondockers Welcome Built a Moat
Let’s look at Boondockers Welcome, started by Marianne Edwards and her daughter, Anna Maste.
Boondockers Welcome is like Airbnb, but for people with RVs. RVers can find hosts who let them park on their land for free. The RVers get a free place to stay, and the hosts enjoy meeting other travelers.
The tricky part was building up both sides—getting enough hosts and guests. This challenge actually became their moat. In a marketplace like this, you need a lot of hosts to attract guests, and you need a lot of guests to attract hosts.
Edwards and Maste had an edge. Edwards had spent years writing travel guides and had a loyal following of people who made great hosts. By reaching out to this group, they quickly filled the site with quality hosts, giving Boondockers Welcome a big lead that was tough for others to match.
This early success helped Boondockers Welcome grow to over 3,500 locations across the country, making it a strong marketplace that was hard for any new competitors to challenge.
The Sale to Harvest Host
This strong network caught the eye of Harvest Host, a service for RVers offering unique camping spots at places like wineries and farms. CEO Joel Holland saw the potential and reached out to Maste and Edwards for a partnership.
At first, Maste and Edwards said no. But Holland, understanding how strong their moat was, kept pushing and asked them to name their price.
Maste and Edwards thought about their ideal number and then doubled it. After some back-and-forth, Holland agreed, and the deal was done just weeks later.
Your moat might make your company more attractive to customers, but it also makes your business more profitable and valuable. Focus on making your moat stronger, and you’ll see your business’s value grow.
I help entrepreneurs buy and sell remarkable businesses as well as help them plan their exits. If you would like to learn more about how much your company is worth and/or how to maximize the value of your business at exit, Click Here to schedule an introductory call with me or feel free to email me dave.godwin@cbiteam.com. I will help you discover how to find out if it’s the right time to exit and help you ask a higher selling price for your business. All information is managed in the strictest of confidentiality.
