Porter's Five Forces

A competitive analysis framework that assesses industry attractiveness by examining five structural forces: competitive rivalry, supplier power, buyer power, threat of new entrants, and threat of substitutes.

Understanding the five forces helps founders choose markets wisely and build moats in the right places. A market with high rivalry, powerful buyers, and easy entry for substitutes is structurally difficult to profit in.

A founder evaluating the online course market uses Porter's Five Forces and discovers high rivalry, low barriers to entry, and strong substitutes (YouTube, podcasts). She repositions to a higher-ticket coaching model with a stronger moat.