The technical moat for software companies is the effort to implement the logic; for instance, many companies have moats because they implement functionality that is hard to reproduce without having access to documentation needed to implement that functionality. It is also possible that there is so much functionality implemented over the years that copying it, while 'just work' is just too much work for most companies to really compete; SAP is an example.

Then there is the example of OpenAI etc; too costly to reproduce simply by not having enough compute.

Besides technical moats, you have client base moats; for instance, a trivial to implement application, like say, Resend (where you can find tons of open and paid alternatives for) did their marketing well (until they got hacked a few times that is) which gave them a moat and they still have some of it. Here is where large incubators give you some advantage; they use circlejerk to give you a lot of clients (their other companies and their clients) from the start.

Then there is a regulatory moat which is common in banking, healthcare etc; you need certificates in distinct regions etc. That makes it harder to compete without having a lot of money.

IP moats; maybe there are patents which competitors would need to work around. I'm against software patents however, they do exist and can hinder competitors to compete directly.

These are all moats which hinder competitors coming up. If a large company wants to compete with your software solution, they can copy it and go after your market. Usually they will look at your moat and just buy you out giving them the moat.

But yes, it is why VCs want you to grow as fast as possible at any cost; to 'take the market' so you have a moat in one or more of the above so in the end it's too much work to catch up and you'll be bought (exit).

Solely on technical merit, it is expected that AI will remove this moat completely over time, but we are not there yet. We don't know what software will look like at that time anyway; probably not really recognisable vs now.