vs. Shift Technologies
Carvana
Scale economies: fill the built network
- What it did
- Retail units 416k (2024) and 597k (2025) through existing plants
- Shift Technologies
- Never exceeded about 23,000 retail units a year
7 Powers
What are the 7 Powers?
7 Powers is Hamilton Helmer's list of the seven ways a business can keep earning more than its rivals. Each power pairs a benefit, such as lower costs or higher prices, with a barrier that stops competitors from taking it away. The seven are scale economies, network economies, counter-positioning, switching costs, branding, cornered resource and process power.
110 winners in our case studies beat a named rival and kept the lead behind a barrier. Switching Costs held 55 of those leads, more than any other power. Process Power held none.
The seven powers, with company examples
Power 1Scale Economies
Unit cost falls with volume; the leader's cost advantage is the barrier. Full page →
Tagged in 15 case studies; the lasting barrier for 15 winners we paired with a rival.
vs. Earnest
SoFi
Capital-markets funding at scale
- What it did
- Securitizing since 2013; $1B SoftBank round (2015)
- Earnest
- $100M equity by 2015; single-A senior notes (2016)
vs. Omada Health
Hinge Health
Scale economies in automated care
- What it did
- Sensor kits replaced by phone-camera TrueMotion (2023)
- Omada Health
- Coaches, video PTs and shipped cellular devices
Power 2Network Economies
Additional relevant participants can make a product more useful to its existing users. Full page →
Tagged in 45 case studies; the lasting barrier for 30 winners we paired with a rival.
vs. Sidecar
Uber
Marketplace network effect (city density)
- What it did
- Pickups under five minutes in dense cities; drivers follow riders to the bigger network
- Sidecar
- Outside San Francisco drivers got a ride every hour or two and left
vs. HomeAway · 2012-24
Airbnb
Two-sided liquidity with guests arriving direct
- What it did
- U.S. sales level with HomeAway 2012-14, then twelvefold growth 2013-18
- HomeAway
- Still led U.S. resort markets (2016); per-booking fees added late (10% option Oct 2013; 5-9% traveler fee 2016) angered owners
vs. Monster · 2011–16
Network effect: members keep profiles because recruiters search them; recruiters pay because members are there
- What it did
- Hiring Solutions $84.9M, +136% a year, against Monster's $250M at +2% (Q4 2011)
- Monster
- Folded BeKnown into the job board to show seekers Facebook connections (May 2012)
Power 3Counter-Positioning
A superior business model the incumbent cannot copy without damaging its existing business. Full page →
Tagged in 15 case studies; the lasting barrier for 3 winners we paired with a rival.
vs. Akamai · 2010–26
Cloudflare
Counter-positioning: free traffic lowers cost and trains defenses
- What it did
- CDN free since 2010 because it serves the paid security products
- Akamai
- Traffic only from paying customers, billed by use
vs. Blockbuster · 1999–2007
Netflix
Rental by mail from a website, on a no-late-fee subscription
- What it did
- Discs ordered from a website, mailed from a queue, kept with no due dates or late fees (Sept 1999)
- Blockbuster
- Collected $800 million in late fees (2000); dropping them gave up about $400 million (2005)
vs. Amazon Redshift · 2017-20
Snowflake
Neutral across clouds, with live data shared between accounts
- What it did
- Data sharing without copies, the consumer paying for compute (June 2017)
- Amazon Redshift
- Runs only on AWS; data sharing arrived in preview Dec 2020, between Redshift clusters on RA3 nodes only
Power 4Switching Costs
The customer expects to lose value by changing to an alternative for the next purchase. Full page →
Tagged in 57 case studies; the lasting barrier for 55 winners we paired with a rival.
vs. HipChat
Slack
Switching costs
- What it did
- Workspaces tied to history, partner channels and 450,000 weekly-used integrations (2019-20)
- HipChat
- Rebuilt from scratch as Stride (2017); IP sold to Slack in 2018
vs. InVision
Figma
Switching costs
- What it did
- Accumulated editable work and shared component libraries are hard to move
- InVision
- Design services shut in 2024
vs. Buildium
AppFolio
Switching costs
- What it did
- Owners, tenants and vendors transact in the manager's system
- Buildium
- Sold to RealPage for $580M (2019), which planned to push its own payments and insurance into the base
Power 5Branding
Accumulated reputation creates buyer preference by reducing uncertainty or increasing perceived value. Full page →
Tagged in 7 case studies; the lasting barrier for 7 winners we paired with a rival.
vs. Trulia
Zillow
Default-destination brand with audience scale economies
- What it did
- About 80% direct traffic, 221M monthly users, 2x the largest rival's daily app users (2025) despite CoStar outspending it about 4x (2023)
- Trulia
- Trulia's brand kept inside Zillow Group since 2015
vs. HomeAway · 2012-24
Airbnb
Two-sided liquidity with guests arriving direct
- What it did
- U.S. sales level with HomeAway 2012-14, then twelvefold growth 2013-18
- HomeAway
- Still led U.S. resort markets (2016); per-booking fees added late (10% option Oct 2013; 5-9% traveler fee 2016) angered owners
vs. SingleCare · 2020–25
GoodRx
Demand ownership
- What it did
- 80%+ repeat activity and 4.9M Monthly Active Consumers at IPO
- SingleCare
- Claims the #2 market position with 7M monthly users (2023) and 40M+ lifetime users (2022)
Power 6Cornered Resource
Preferential access, at attractive terms, to a coveted asset that independently enhances value. Full page →
No case study is tagged with it yet; the lasting barrier for 1 winner we paired with a rival.
vs. Kabbage · 2017–25
PayPal
Cornered resource: the lender that holds the merchant's sales flow
- What it did
- More than $30 billion of loans and cash advances to more than 420,000 business accounts since 2013, renewed or re-accessed more than 90% of the time (2025)
- Kabbage
- Kabbage launched Kabbage Payments in October 2019 to come at the sales flow from the lending side
Power 7Process Power
Embedded organizational routines that deliver lower cost or higher quality and can only be matched by a long, costly commitment. Full page →
Tagged in 1 case study; the lasting barrier for 0 winners we paired with a rival.
None of the winners in our case studies held their lead on process power yet. Helmer's own example is the Toyota Production System.
Where Strategy Canon splits the list
Network economies cover several different mechanisms, so each has its own page: marketplace network effects, platform network effects, data network effects, expertise network effects, protocol network effects, collaboration & exchange network effects, payment network effects. The idea under all seven, that a power needs both a benefit and a barrier, has a page too: power = benefit + barrier. For every barrier our case studies found, not only Helmer's seven, see competitive advantage examples.
Source
Hamilton Helmer — 7 Powers: The Foundations of Business Strategy (2016)