# Moat By Induction

Most startups are founded with no moats. But the best ones can prove moat by induction.

Induction is a simple mathematical way to prove statements. An example: *Can you climb a ladder to the top?*

Base case

`n=0`

*– Can you get on the bottom rung of the ladder?*Induction step (given

`n=k`

, prove`n=k+1`

)*– At a given rung, can you climb up to the next rung?*

Moat by induction can manifest in many ways. Take network effects:

Is your product valuable to a single user (

`n=1`

is the base case).With

`n=k`

users, how much more value does a customer get with`n=k+1`

users?

Sometimes it's about solving zero to one and then one to *n.*