A recent equity research article published by Seeking Alpha analyzed the business model of Fitbit against the allegation that it would become the next GoPro — a one-hit wonder unable to achieve long term success. Fitbit, founded in 2007 by former Clevelander James Park, was at the cutting edge of new technology for fitness trackers, just as GoPro was for video cameras. However, competitors have crept into the marketplace, chewing away at Fitbit’s success, just as GoPro experienced.
The significance that must not be lost on business owners is the role of intellectual property. As a first mover, a business that has a strong intellectual property portfolio — and is willing to defend it and prosecute against infringers — is a company that will succeed in the long term. Cutting-edge technology begets more cutting-edge technology, and protecting that is integral to success in business.