Startup founders have so much invested in their company that it can cloud the way they think about competition. Sometimes you can be too paranoid and get way too focused on competitors, to the point that they cause you to take your eye off the ball. In other cases, you can be so focused on what you are doing that you can be blind to your competitors and fail to respond when they start doing things that are pretty smart that you should be learning from.
One of my biggest pet peeves when speaking with entrepreneurs about their business is the way some talk about their competition. Specifically, I get annoyed by entrepreneurs who are overly dismissive of their competitors. You don’t need to go through a laundry list of competitors, but there is almost certainly at least 1 or 2 that are going to pose a formidable threat in some meaningful way. Personally, I appreciate entrepreneurs that are thoughtful about competition, and will speak fairly deeply about the small number of companies (large or small) that are really potential threats to their success. I prefer a vibe that goes something like:
“These guys are good. Here’s how we are different and why we think we will win. But they’ve make some really smart choices too. I look forward to competing against them.”
This is way harder said than done. Responding to competition is highly emotional. Trust me, we experience this too.When a competitor comes onto the scene, or makes an interesting move, it’s easy to experience a wide range of strong emotions:
- Admiration “why didn’t I think of that?”
- Envy “crap, I did think of that, they just beat us to it”
- Dismissiveness “They have no idea what they are doing. What a dumb strategy”
- Denial. “They aren’t really competitors”
- Aggression. “We’re going to crush them”
- on and on and on…
It’s not easy to have a balanced view of competition. But I think it’s pretty critical. You need to be aware of competitors, and have an honest appreciation for that they are doing and what it might mean. Then you have to decide whether it changes your plans or not. Then you have to forget about them for a while, and focus on great execution and playing your own game to the best of your ability. Not as easy as it sounds.