Competition is overrated cdixon.org – chris dixon's blog. Your #1 competitor starting out will always be the BACK button, nothing else. – Garry Tan Suppose you have an idea for a startup, and then do some research only to discover there are already similar products on the market.
You become disheartened and wonder if you should abandon your idea. In fact, the existence of competing products is a meaningful signal, but not necessarily a negative one. Here are some things to consider. 1) Almost every good idea has already been built. Other times existing companies simply didn’t execute well. 2) The fact that other entrepreneurs thought the idea was good enough to build can be a positive signal. 3) That other people tried your idea without success could imply it’s a bad idea or simply that the timing or execution was wrong. Startups are primarly competing against indifference, lack of awareness, and lack of understanding — not other startups.
Resegment If You Aren’t In The Top Three. Six months ago I wrote a post about how I think about competition which included a list of topics that summarizes my philosophy.
I covered the first item, Be The First Mover, but then went on to other things, like thinking about competitors every single day. I’m back today with the second topic, “Resegment If You Aren’t In The Top Three.” If you look at the Foundry Group portfolio, you’ll notice a lot of market leaders. Zynga is the obvious one, but I’ll assert that there are many others, including AdMeld (now part of Google), Cheezburger, Fitbit, Gnip, Makerbot, Oblong, SendGrid, Topspin, Trada, and Urban Airship. After that there is a category of companies who might be market leaders, but it’s too early to tell as they are still very young.
An important nuance is that these companies weren’t unambiguously market leaders when they got started. Existing markets are wonderful places to go play in especially if they are expanding rapidly. Don’t bullshit yourself about this. How to Compete. How do we compete with other companies?
What are our unique differentiators? In a world where everything is pretty much the same, what matters? They’re bigger than us. They have more budget than us. They have the market share. Zappos had to convince thousands and thousands of customers that ordering shoes on the web was easy, and that their customer service policies were top shelf.