Learn more about Jonathan Lowenhar at ETWadvisors.com.
“We have no competition…”
When I hear this phrase, I typically have the same thought… the entrepreneur is lying to him/herself, the entrepreneur is lying to me, or the entrepreneur has not done his/her homework.
I get it. You’re out in the market — talking to customers, signing pilots, and negotiating deals. You’re attending trade shows and industry talks. You’re reading constantly and staying current on the latest innovations. There are no enemies in sight. It’s easy to believe you’re alone.
How do I know? Because the world is a big place, often bigger than the early-stage CEO can comprehend. Because there are vast armies of young entrepreneurs in accelerators, incubators, and coffee shops who you just haven’t come across yet. Because big companies are already discussing buy vs. build scenarios for the same problem you are tackling. Because your little company (no matter how big it feels to you) doesn’t know what it doesn’t know.
Competitors are like stars blazing bright overhead. At night, our eyes can only see 5,000 of them.
Yet, because… science ☺, we know there are a septillion stars in the observable universe. That’s 1,000,000,000,000,000,000,000,000 stars.
So, there are many more competitors than you can detect, and you likely don’t have the time or resources to detect them. What to do?
Not much, actually.
When you’re getting started, do your homework. Understand your domain deeply, evaluate the size of the market, research the competitors, and test various methods of differentiation. But until you have your hypothesis set and enough early evidence to suggest that you can create a sustainable business, ignore the competitors for a while.
Why? Because you’re just trying to find your footing. Let’s try a sports metaphor. When you first launch a start-up, it’s like learning how to play golf. Sure, you might have aspirations to reach a certain handicap or win a local competition, but in the beginning, you just need to learn how to swing a club. Forget about the scorecard; just try and make contact with the sinister little sphere. What other players do doesn’t matter; just focus on what you can control.
When your start-up matures a bit, now you’re playing chess. Your opponents’ moves matter. You have to decide between offense and defense. Evaluating past actions to predict future ones is paramount. Wrong decisions in chess don’t just mean missed opportunity; they can mean (figurative) death.
So think about competition, plan for it, and then de-prioritize it until you know how to hit a golf ball reasonably straight. Because if you’re not good at what you’re trying to do in the world, it doesn’t matter what the other companies are doing…