MOATS BEFORE (GROSS) MARGINS

Summary from the TLDR Founders newsletter

Investors obsess over gross margins, but Apple has a 38% margin - roughly half of most software companies - and it's one of the most valuable businesses on earth. Margins don't determine great companies, moats - like Network effects, economies of scale, brand power, and switching costs - do. In the AI era, the obsession with high margins is even more dangerous. It might just mean your product isn't using any AI at all.