7 Powers by Hamilton Helmer — book cover

7 Powers

Hamilton Helmer · 2016

7 Powers (2016) is a book by Hamilton Helmer on business & strategy. Hamilton Helmer distills decades of advising Silicon Valley into the seven, and only seven, sources of durable advantage, each a precise mix of Benefit and Barrier that lets a company earn persistent differential returns.

11 min read · 9 chapters · Business

Why it’s on the shelf

The rare strategy book written with the rigor of an economist: it names exactly seven moats and proves why, for each one, competitors literally cannot follow you across.

Two of the ideas you’ll keep

The Clif summary of 7 Powers pulls out 7 insights. Here are the first two.

  1. Power always equals a Benefit plus a Barrier. A benefit alone (lower costs, higher prices, less capital) gets arbitraged away by competitors; only a barrier they cannot cross turns advantage into durable, persistent differential returns.
  2. Helmer's Fundamental Equation of Strategy is Value = M0 · g · s̄ · m̄, current market size times growth times long-term share times differential margin. The last two terms are Power; the first two are Market Scale, and both must be present for real value.

The other 5 — and the full 11-minute summary — are in the app.

What’s inside: 9 chapters

The whole summary runs about 11 minutes, read or listened to.

  1. What Power Actually Is: Benefit Plus Barrier
  2. The Fundamental Equation of Strategy
  3. Scale Economies: The Netflix Machine
  4. Network Economies: Value That Compounds With Users
  5. Counter-Positioning: The Power Incumbents Can't Copy
  6. Switching Costs and Branding
  7. Cornered Resource and Process Power
  8. Statics and Dynamics: Getting to Power
  9. The Power Progression: When Each Moat Appears

Finish 7 Powers tonight.

Read or listen to the full summary in about 11 minutes, then keep the ideas with a minute of review a day. Start with the 2-minute quiz — no card required.

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