Founders debate which moats survive when AI clones software

Technical moats are mostly over at this point. If you’re building something that is meant to be durable, the only moats now are: • Proprietary data • Network effects • A physical component • A “physical” component • Blackmailing your competitors • Proprietary devices that can run hundreds of comprehensive lab and disease tests from just a single drop of blood • Ransom notes • Selling $2 for $1 • Selling $5 for $1 (investors HATE this 1 trick!!) • FTXing around and finding out • Having a sick logo • Raising $1B and using $999M of it to sue all of your competitors • Having a cool podcast (3 listeners) • Racketeering • Having a logo that’s so offensive that people report your company to the local news and you go viral

One guy just cloned $100 billion worth of Adobe software in about a week. Then he put all of it on GitHub for free. The project is called ArtCraft. Brandon Thomas, a software engineer with 15 years in the industry, pushed his first commit on September 30. Within days there were working open source versions of Photoshop, Illustrator, Premiere, Lightroom, After Effects, InDesign, and Acrobat, all written in Rust, with Claude Opus doing most of the typing. He built them clean-room too, the project actually bans decompiled code. Here's where it gets interesting for anyone who thinks Adobe is finished. A free Photoshop has existed since 1996. It's called GIMP. Adobe grew from $4.8 billion to $23.8 billion in revenue with it sitting one download away the entire time. The money comes from the…

I feel mixed about the "all software is becoming open source" narrative. While it's true that many apps and games can basically be reverse-engineered with AI now, there are still moats and trade-offs: 1. Distribution and network effects. It's still hard to get a lot of people to join a game at the same time or connect with each other. The flip side here is that if you have distribution, you can make alot of money in a short period of time even if your product is just an AI wrapper. 2. Enterprise compliance and trust. Enterprises drive ~60% of software spend. AI might make it easier for apps to pass security and compliance reviews, but big companies still want legal liability, support, and someone to blame when things break. I don't think any Fortune 500 company is switching from Adobe to…

Agreed technical moats are basically dead. Only others I’d add: 1) Brand aka trusted distribution 2) Regulatory positioning