Build infrastructure tools for an emerging ecosystem rather than competing as a player within it
When a new technology ecosystem emerges with many competing players, building the shared infrastructure (tools, testing, simulation) that all players need creates a more defensible position than picking one approach and competing directly. You serve the entire ecosystem without betting on a single winner.
When to use
When entering a market with many well-funded competitors racing to build the end product (self-driving cars, AI agents, etc.) and you have technical expertise to build developer/engineering tools
Don't do this
Competing directly as yet another player in a capital-intensive winner-take-all market
4 Founders Who Did This
Instead of building an autonomous vehicle, Younis and Ludwig built the simulation and infrastructure tools that every AV developer needs, serving the entire ecosystem as a neutral provider
Built infrastructure tooling (documentation layer) for the AI coding ecosystem rather than competing as another AI coding tool
Built infrastructure tools (payments API) for the emerging internet economy rather than competing as a player within it. Recognized that every internet business needed payments but hated building it
Built API infrastructure for the embedded finance ecosystem rather than competing as a fintech end-product, enabling any platform to embed financial workflows