Whereas market opportunities approach anticipated success through the market and its dynamics, competitive advantage is based on a company’s internal factors. What is a better indication of a company’s ability to function in the market than those companies that are already there?

”A startup is an organization formed to search for a repeatable and scalable business model.”
– Steve Blank 2010

A market competitive advantage can be divided into IPR protection, traceability of the solution, sales channels, operating model and earnings model.

IPR protection provides, especially in technology-based innovations, a competitive advantage if the protection has been carried out correctly. A patent in itself does not necessarily have any value simply because it exists. A country-specific patent or a trademark alone does not have any value to speak of either. Frequently, a confirmed freedom to operate is sufficient to show that the entrepreneur has familiarised him- or herself with IPR issues and at least does not infringe the patents of others. It should also be taken into account that names and domains may constitute an essential part of a company’s IPR property. Simple IPR test is located at: tuotevayla.fi/en/inventors-tools/ipr

In many cases, it is not possible to protect a product with patents or design rights (e.g. services); instead successful realisation of a unit is based on small details and solutions that a company has been able to execute more effectively than competitors. This is called traceability of the solution. In other words, although other actors see from the outside what a company is doing, it is difficult to imitate the achievement and the company in question retains its competitive advantage (e.g. Coca-Cola).

Sales channels and related agreements in particular (key distribution channels, waiting periods, exclusive rights, etc.) can create a considerable competitive advantage. Likewise an exceptional operating or earnings model can strip away the traditional ground rules in a sector to the extent that it forces other actors to withdraw in fear of losses.