One of the best things about ecommerce entrepreneurship is that it doesn’t require much technical skill. Paradoxically, this is what makes it incredibly difficult.

First, it’s worth recognizing how drastically different it is to run an ecom site now vs. a decade or even a few years ago. To be an ecom entrepreneur in the old days, you basically needed to know how to program (or hire someone who knew) in order to get a working site up and running. Emails were difficult to design and develop. And acquiring customers took deep understanding of the prevailing ad platforms like Google Display Network and the skill to technically optimize your site for SEO.

Over time, new tools were invented which basically did all the hard work for you. Shopify and Stripe have made it easy to set up a site and collect payment, respectively. Klaviyo allows novices to use templates to design emails and with only a few clicks schedule campaigns. Meta ads made customer acquisition as simple as designing an ad and setting a budget. And China-based manufacturers are now excellent at selling goods directly to small businesses through platforms like Alibaba.

The result is, in a surprisingly short period of time, the entire stack of running an ecom operation was reduced from a set of hard, technical skills to a set of soft, easy-to-learn skills, empowering a huge number of new people to become ecom entrepreneurs. These days, a non-technical ecom entrepreneur can rely on off-the-shelf tools for a website, email, payments, advertising, customer support, and sourcing of goods through a combination of Shopify, Stripe, Klaviyo, Facebook, Gorgias, Alibaba, and 3PLs like ShipBob. They can find reliable, inexpensive, and hard-working and experienced Filipino CX agents for a few dollars an hour.

Aspiring entrepreneurs have noticed. Exact stats are hard to come by but the number of Shopify stores exploded from ~150K in 2014 to more than 4.5M today.

But, as I’ve written, with greater competition came increasing difficulty at generating sustained profitability.

Why? Meta and Google are both pure auctions and more competitors lead to higher and higher bids for ad delivery. And new competitors inevitably end up competing on price, forcing all sellers to accept lower gross margins.

Incidentally, I believe a similar dynamic is playing out in other entrepreneurial spaces. Software developer founders used to have few competitors because relatively few people could write code. While there are still many fewer entrepreneurs today who can code vs. start an ecom store, software entrepreneurs face increasing competition too.

For one, there are many more developers now. In 2000, there were about 30K computer science grads; in 2022, there were about 100K. But even more importantly, tools like Webflow, Bubble, and (increasingly) AI are abstracting away the need for traditional coding. Today you can use Webflow to easily build a beautiful website and add features like authentication, analytics, forms, CMS, and more.

As much AI will enhance coding ability, if AI eventually allows anyone to code with natural language instruction, we’ll likely see a massive proliferation of new software which will lead to a collapse in software co margins.

The tools that have made it easier to run an ecom store or code have democratized entrepreneurship. Unfortunately, if it’s easier for you, it’s easier for your competitors.