Hard Things Are the Only Moat
Every moat gets crossed eventually — the one that lasts is a willingness to do what rivals won't
- Difficulty
- Expert
- Time to result
- ~months to results
- Steps
- 4
- Confidence
- 95%
Aluwi rejects the conventional moat conversation: features, capabilities, distribution partners and network effects all get crossed with enough time. The one durable position is being the company willing to run the operationally miserable, unscalable, unglamorous thing that creates real customer value — precisely because rivals with an easier alternative won't do it. Gojek built cash-vault booths and a private security force on this logic.
Origin
Kevin Aluwi's rebuttal to the moat framing used by 'strategy type folks' and VCs, formed at Gojek in Indonesia where the missing infrastructure (no digital payments, violent incumbent taxi mafias) forced operational solutions no US-style playbook covered.
Core principles
- 01No moat is durable; with enough time all moats can be crossed.
- 02Doing hard things is an under-discussed moat because difficulty itself deters imitation.
- 03The hard thing only counts as a moat if it demonstrably creates value for customers, drivers or merchants.
- 04Early-stage companies in immature markets should be more ops-heavy than tech-heavy.
- 05Solving elegantly and technically takes time your customers don't have — ops innovation is the bridge to the eventual scalable solution.
- 06The hard thing also compounds into brand: it proves you care in a way advertising cannot.
How to run it
- 1
Find the problem everyone treats as not-your-problem
Look for the pain adjacent to your product that a reasonable company would disclaim — 'they're contractors, they're third parties, let them sort it out'. That disclaimer is the boundary of every competitor's willingness.
Pro tip The louder your internal instinct to say 'not our liability', the more likely it's a moat.
- 2
Check it creates real value, not just difficulty
Hardness alone is not a moat — masochism isn't strategy. The test is whether solving it materially improves life for a customer, driver or merchant who currently has no alternative.
Watch out If nobody's experience improves, you've bought cost, not defensibility.
- 3
Solve it operationally, not elegantly
Build the manual, headcount-heavy, non-scaling version now. Booths with vaults, patrol teams, stadium rentals — whatever ships this month. Perfection is a disservice to customers who need it working today.
Pro tip Aluwi: over-focusing on elegant technical solutions does your customers a disservice, because ops innovation can make things a lot better right now.
Watch out Expect it to look absurd from the outside and to be unbudgetable in a normal plan.
- 4
Run it until the scalable version exists — then migrate
Treat the operational hack as a bridge with an explicit exit. Gojek ran cash booths until it could integrate with a bank and an ATM network; it ran private security until Gojek drivers became normal on the streets.
Watch out Failing to name the exit turns a bridge into a permanent cost centre.
In the wild
Indonesia had almost no digital payments infrastructure when Gojek launched, but customers paid by card or store balance and drivers needed their earnings and incentives in cash. So Gojek built physical booths with vaults full of cash across the country, where a driver could show his driver ID and balance and be paid out by hand — with tens of thousands of drivers already on the platform.
→ Gojek effectively ran a mini ATM network itself until it could integrate with a bank and a real ATM network. No competitor imitated it.
Territory in Indonesian cities was controlled through violence by motorcycle-taxi mafias. Gojek drivers picking up orders were physically assaulted — bricks thrown, knives and machetes brandished, mob brawls in the streets of Jakarta. Gojek could have called the drivers third-party contractors and let them sort it out. Instead it contracted private security firms and ran on-call patrols in known hotspots that could reach a driver within five to ten minutes.
→ A large private security operation ran for a long time, until Gojek drivers became commonplace. It kept drivers safe and generated deep driver loyalty that survived competitors arriving with more money and bigger incentives.
Common mistakes
Shopping for a moat in features, capabilities and partnerships
Aluwi: these are what people reach for when asked 'what's your moat', and none of them are durable — with enough time, all of them get crossed.
Outsourcing the pain to contractors to keep the model clean
The easy move for Gojek was to treat driver safety as a third-party problem. Taking it on was expensive and unscalable — and became both a moat and the foundation of driver loyalty when better-funded rivals arrived.
Waiting for the elegant technical solution
In immature markets the scalable engineering answer arrives far too late. Aluwi's view is that over-indexing on it disserves customers when an ops-heavy hack could kickstart the thing today.
Is it for you?
Best for
Founders in emerging or infrastructure-poor markets, or any category where the obvious moats (features, funding, partnerships) are all held by a bigger competitor
Not ideal for
Capital-constrained teams pre-product-market-fit, or any situation where the hard thing produces no measurable customer benefit — hardness for its own sake is just burn
From the transcript
“I don't believe that any modes are durable over time eventually with enough time all modes can be crossed”
“because hard things are hard um and just simply doing things that are hard as long as they prove they create value to your customers…”
“we actually work with private security companies to help um these situations to help our drivers in those situations”
From the episode
Taxi mafias, cash vaults, and 100% MoM growth: The story behind Southeast Asia’s biggest startup
Kevin Aluwi (Gojek)