Something’s missing in how most of us think about competition. We’ll outwardly project that we’re not worried about it at all. “Oh, those guys? They’re targeting OLDER couples. We’re looking for 20-something couples.” Said as if we signed a secret agreement in the Hall of Trusty Founders that divvied up the market just that elegantly. I call these people the Great Pretenders — the liars. But we’ll get to that.
Inwardly, on the other hand — I’ve seen the total manic fear caused by competition drive otherwise competent founders near mad. I’ve seen founders try (and unfortunately succeed) to convince investors of their niche focus and how the product they’ve built is better or more specific for all the right reasons — when that niche didn’t exist until a competitor’s launch forced us into it one week prior. I’ve been that person, to my own dismay.
The truth about competition is that we only talk about it when it benefits us.
We weave the stories around the market and our competitors in a way that make us seem the most favorable and likely to succeed — because, after all — that’s what everyone wants to hear, from the investors down to the newest hire. They want what we say about the competition to make them feel safe. It’s an unfortunate lie that does more damage than good.
When I was building Librify (a Netflix for eBooks now in the startup graveyard), I can remember one of our greatest competition lies. Ask an eBooks startup…
“Aren’t you worried about Amazon?”
And you’ll get a million answers other than “Fuck yeah man. Super worried.”
- No, our product is for tablet readers. Ah, yes, the fabled tablet reader.
- We have a unique feature that will bring readers to the platform. Because seeing your friend’s progress is FAR more important than reading on your Kindle.
- We have all the publisher’s on our side. As if that also magically suggested sales and a market percentage.
We’re storying away the competition because we want to inspire confidence in someone else, and maybe their confidence will make us ACTUALLY feel safe too. It won’t. On the inside, some part of you will still be freaking the fuck out about competition. It’s what makes us a Great Pretender. We’re faking our confidence and trying to blur any unfavorable truths. It puts far too much of a founder’s focus on image and optics over effort and analysis.
You’ll create a pattern and a habit out of actions like this, and ultimately, you’ll be both a weaker founder and person.
The honest question that I like founders to ask when thinking about their competition is this:
Can they solve the problem I’m trying to solve better than me?
In the case of Librify, I was faced with this when Oyster Books launched, which did become — for a hot second — the leader in the race to being the Netflix for eBooks (they’re in the graveyard too, these days). Eventually I kept looking at their company and had to face some hard realizations.
- They have a more experienced founding team than we do.
- They have a more simple product that appears easier to sell.
- They have better design.
- They are able to execute faster.
I realize these aren’t easy things for many founders to admit about their competition, but you MUST. You need to admit it to yourself, because far too few of us are surrounded by the people that will help us to admit it. You know, also, by the way — surround yourself with people that will help you admit it. It will save you a lot of time down the road.
I was too young in experience and my career to even admit Oyster Books was a “Direct” competitor some of the times. Not to mention the ultimate truth that we were all ignoring — not a one of us was going to peel business away from the Kindle in a way that would make us sustainable.
We offered the market nothing that our competitors couldn’t do better — and in the end, the market made sure we knew that. The sooner you’re honest and get to the point where you’re outlining your competitor’s advantages, the sooner you can return to what you need to do, tactically, to offset those advantages.
- They have a more experienced founding team?
You can fix this. Expand your executive team or collect (and USE) advisors to improve your own experience.
- They can execute faster?
Focus on your product and engineering execution to improve predictability and velocity.
Once you have tactical awareness, you can solve the issue and move forward… but, and here’s the curve-ball — should you?
I think of competition in terms of Effective Time Math.
As an investor or advisor or founder — the greatest analysis I would enforce upon your company in relation to your competition is this. Based on the tactical deficiencies you’re facing against stronger competition, will the percentage of Effective Time you need to spend winning that competition leave you too far behind?
If you have 100% time to build Netflix for eBooks, and your competition has 100% time to build Netflix for eBooks — but they also have tactical advantages that can be easily identified, and you need to spend 20% of your time and effort resolving those deficiencies (perhaps experience, or networking/access) — then you’ll have less Effective Time to solve the problems of your users and build good products.
There’s a percentage, somewhere — for every founder or investor or company where you need to make an honest conclusion — we can’t win. You can then play all the games you want in determining whether you can still succeed without winning, or whether your grit and determination will outweigh your deficiencies — but doing that, to me, is far better than pretending you don’t need to.