When Describing Your Startup as “Uber for X” is a Big Mistake

A version of this post first appeared on RocketWatcher — When describing your startup as “Uber for X” is a Big Mistake

Describing what your startup does, particularly when that product is something the world has never seen before, is hard. One of the first steps in positioning an offering is to establish a frame of reference for prospects or investors. By describing your offering as being similar to something else, you can build on what prospects already know and use that to help them make the leap to understanding what you’ve got.

The idea of a “High Concept Pitch” for startups has been around for a while. I first saw this in a Venture Hacks post (from 2008) that outlined it as a way to “describe the company’s vision on the back of a business card”. Some examples given were:

  • Friendster for Dogs (Dogster)
  • Flickr for video (YouTube)
  • The Firefox of media players (Songbird)

While looking back at these specific example is entertaining (who would compare themselves to Friendster? Imagine YouTube positioning itself against Flickr? What does “the Firefox of” mean anyway?), this method for describing a startup continues to be super popular. A MarketWatch study recently analyzed AngelList profiles of startups and determined Airbnb, Uber and LinkedIn were the top 3 companies used to describe a new company.

As popular as this approach is, there are also some ways that this positioning could be not just ineffective, but downright harmful for your company. Here are some things to consider:

Positioning for a VC pitch is not the same as positioning for a prospect

Whether or not a pitch works depends a lot on the audience and what they are hoping to get out of it. The “Uber for X” pitch works best for a VC audience where you are trying to emphasize the growth potential of your idea by comparing it to other high-growth companies. For prospects however, the value they hope to get from your product could be very different from what Uber, Airbnb or LinkedIn provides. While a VC might be intrigued by the idea of “Uber for kitchen appliances”, a prospect might find “Kitchen appliance rental” easier to understand. If the comparison pitch works with investors, go ahead and use it, but keep in mind that your pitch to potential customers may need to be very different.

It assumes the audience knows the company you are comparing yourself to

This should be obvious but for some of us that spend all day in the startup world, it’s easy to forget that not everyone uses Airbnb and Uber. If my target audience was executives at large companies, the Airbnb comparison might not work at all and I’ve come across buyer segments (CEOs of small manufacturing plants for example) that have never used LinkedIn, nor do they understand why anyone would. Again, for an investor pitch the comparison might work but be careful that it works the same way with a prospect.

The comparison brings both good and bad qualities with it

Comparing your company with Uber could mean you are a business that is growing like crazy by translating online demand to offline fulfillment, but it could also mean that you expect to have loads of regulatory issues, plan on using borderline legal competitive tactics, don’t give a hoot about safety and/or are just kind of crappy human beings all-around. A good example here is Shuddle. When it recently raised a round of financing, it was hailed as “Uber for Kids” in the press. I can imagine this working with investors but I couldn’t imagine a worse comparison for an audience of parents. Go to their website however, and you will see that’s not at all how they describe themselves. “Scheduled rides for busy parents” feels a whole lot better, while still clearly, succinctly explaining what they do.

It may not help answer the question “What is this thing anyway?”

The other problem with the “Uber for X” comparison is that it might make figuring out what you do more confusing. Comparing your company to Uber may be a good shorthand for helping people to understand the model for your business but not the actual business itself. For example if I told you my business was Airbnb for shipping packages, I’m not sure you would understand it. But if I said my business (like PiggyBee) was shipping packages with travellers, you might understand that better. Not every business that is about using unused capacity for something is best described as “Airbnb for…”

It can make you look less innovative

If everyone is comparing themselves to Uber, does the comparison still work, even for VC’s? In some cases investors are getting tired of it. Jeremy Levine, a partner with Bessemer Venture Partners in New York stated that “It’s no longer quite so inspiring” and that when VC’s hear it, it should give them a “nagging reservation” that the company isn’t unique or innovative.

You might find that saying you are LinkedIn for dogs or Airbnb for babies still works but first make sure that you have spent some time thinking about your audience and the company you are comparing yourself to. Also, a “high concept pitch” isn’t the same thing as positioning or a tag line or even messaging. It’s merely a short form way of describing what you are at a high level. You still have to do the hard work of really positioning your startup by defining who your target segments are, what market you play in, what your key value is and how you are different from other alternatives.

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