May 3, 2019

How to react to competition in the MVP process?

Hello IH,

I always read the posts, but almost never participate, but yesterday was a really paricular day for me and talking to my brother, he gave me the idea of sharing the situation here to improve with the insights that you can provide me.

Here´s the deal, we (my brother and me) are working for some time in bringing an idea that´s already working in the US, to our country, Argentina.
After a looot of work, we are really close to the MVP, to validate the idea and keep working after that.
But the "mental meltdown moment" was because there´s a company that does exactly the same, and it´s starting in my city next week...
It´s also a new company, it´s been around only for 8 months, but the thing is that a "competition" appeared in the worst time, because we´re just learning to walk and I feel that someone is already running around us... with exactly the same idea.

I talk to a entrepreneur friend, he told me that competion can be good, because I can see what they do and try to do it better, other told me that I can wait to see how they move before going into the market...
And to be honest, I have no idea what to do, it felt like a huge punch in the face the timing of all this, so I´m asking you for recomendations and experience about how to work this out, I was so blue yesterday that I even thought of letting go.

  1. 8

    Competition is your ally. It's an indicator of an existing problem and striving crowd that needs a solution. I better make a product inside saturated market than starting to make another "genius" idea nobody wants in the end.

    1. 1

      Thank you Vladimir, that's why we take and external idea already working and brought it here... It seems that someone else had the same idea ja.

      But you're right, this competition seems to prove that the product can work in my country and that is a good situation

  2. 6

    Hey Patricio, I'm an Argentinian Founder too! but I live in San Francisco. goo to see you here.

    Competition is a good thing!! especially early on when you don't really know if you are solving a real problem. It means there is likely demand in your market for someone to spend their time solving the same problem. As you listen to your users an iterate your solution, you are likely to evolve in a different direction that they do anyway.

    I remember the first time I found someone doing the same that I was just starting out. it was a punch in the stomach. Now I see it differently. I was just on a call with a user earlier today and they told me how the found a solution that does what we do cheaper and better. It does not bother me anymore.

    Here's how to think about the competition at the MVP level. think of them as companies that are operating in a parallel universe one that you get to observe and borrow ideas from, they are testing things just like you do. messaging, features, pricing. and if you are smart and ad your own intuition you can learn from their efforts. and then apply what works for you. having competitors in an MVP is a blessing!

    1. 1

      Hi Tomás! Thank you for the answer, I would like to talk with you about a crazy idea that I have and I can use your insights of both countries

      1. 1

        sure, I emailed you

    2. 1

      Well said

  3. 5

    It depends on your market. Can two of these products exist in the same market? In the US, Lyft and Uber sit side by side. However, there's really only one Yelp. It's fairly entrenched, and nothing really comes close to it.

    Do you have a product that can share the market, or do you have a product that is significantly different that it can have it's own niche. Back to Yelp, Google Maps has reviews, but it's not really a competitor because the intent is so different with both apps.

    Competition is tough and feeling blue is completely normal. Overlap, however, is normal. Most things out there aren't completely new. IH's audience overlaps with many others, but by all measures it's still pretty successful and serves a purpose that's unique.

    Scope our your competition and see if it's worth the fight. It sounds like you'll be competing with a non-local company and that can give you some edge. Find all the edges you can and really decide if that's enough to keep fighting. Is what you are bringing to your users that much better.

    1. 1

      Thank you! After reading this, I think that I have to compete, I'm putting my efforts now and see how we can improve the service, to make it better than theirs

  4. 2

    I strongly suggest you start reading Paul Graham, if you haven't already (founder of YC). He writes a fascinating article about wealth and there's an excerpt that is quite interesting given the context.

    The Pie Fallacy

    A surprising number of people retain from childhood the idea that there is a fixed amount of wealth in the world. There is, in any normal family, a fixed amount of money at any moment. But that's not the same thing.

    When wealth is talked about in this context, it is often described as a pie. "You can't make the pie larger," say politicians. When you're talking about the amount of money in one family's bank account, or the amount available to a government from one year's tax revenue, this is true. If one person gets more, someone else has to get less.

    I can remember believing, as a child, that if a few rich people had all the money, it left less for everyone else. Many people seem to continue to believe something like this well into adulthood. This fallacy is usually there in the background when you hear someone talking about how x percent of the population have y percent of the wealth. If you plan to start a startup, then whether you realize it or not, you're planning to disprove the Pie Fallacy.

    What leads people astray here is the abstraction of money. Money is not wealth. It's just something we use to move wealth around. So although there may be, in certain specific moments (like your family, this month) a fixed amount of money available to trade with other people for things you want, there is not a fixed amount of wealth in the world. You can make more wealth. Wealth has been getting created and destroyed (but on balance, created) for all of human history.

    Suppose you own a beat-up old car. Instead of sitting on your butt next summer, you could spend the time restoring your car to pristine condition. In doing so you create wealth. The world is-- and you specifically are-- one pristine old car the richer. And not just in some metaphorical way. If you sell your car, you'll get more for it.

    In restoring your old car you have made yourself richer. You haven't made anyone else poorer. So there is obviously not a fixed pie. And in fact, when you look at it this way, you wonder why anyone would think there was.

    http://paulgraham.com/wealth.html

    1. 1

      Hi snow man, I know the pie fallacy, but it wasn't in my mind right now, so thank you, it's perfect timing to remember this.

  5. 2

    Do not lose heart. Competition just affirms the opportunity you and your brother identified. Remember, that Apple's iPod was not first in market --- but easily beat everyone in the field. It also did not bring the first smart phone in the market ... but made its product better than others. It's all about execution plus your creative vision, plus working closely with customer / consumer insights. I would alway go back to the customer journey. Map it out, and look for the critical points that will make you win over the other company. Also pay attention to the post-purchase process, and find a feedback loop where possible (to give oyu feedback to continuously improve.) Don't quit at the sight of competition. The Finish line is in sight. Good luck and fight the good fight.

    1. 1

      Thank you! No doubt this is the next step, pay attention how to win, we will do our best to do it :)

  6. 1

    Thank you all for the time spent helping me to get my brain together.

    Most of the answers are REAAALLY helpful, and I can say that after reading a lot of the subject here in IH.

    It means a lot for me all the insights that you provide and it's really encouraging me to keep working.

    Again, thank you all!

  7. 1

    Looking at Competition as a founder is like looking at the popular/rich kids in high school. Natural to feel inferior, that’s a voice you should stomp. Instead, observe and learn. Execution matters so much, and keep a very close ear to the customer so you can execute faster and with more accuracy.

    1. 1

      That's exactly how I feel, ja. But I read something in another post that said that maybe they're a problem to me, maybe most of the people don't know them yet, so there's a window to see that

  8. 1

    This is a 2 edged sword..and the advice you got was right on both sides of the blade..competition can be good for you ...or you can wait to enter the market .

    Here is what i would do

    I would not assume that just because they announced a product launch , that they know what they are doing .

    1 ) conduct competitive intelligence on the "opponent "..on their product

    owners , employees...check social media feeds , linkedin pages , FB , twitter ,news releases and anything on the net .

    1. OUT Innovate the competition....Since they are basically creating the same product , you know most of what they are doing...

    The winning product process is based on continuous innovation. It’s based on focus and planning. Continuous unbiased research and goal-focused development.

    "You can’t just capture the market once and expect to keep it. You have to do it over and over again and faster than everyone else if you want to keep distance from competitors coming up behind you and disrupting you. That’s how you get ahead of the market. "

    Give your product something special..something unique...for instance ..ADD voice to your product https://www.programmableweb.com/api/apple-homekit

    Does the product allow users to access facebook marketing for their business projects ?

    https://www.programmableweb.com/api/facebook-marketing

    or provide Amazon related services like

    https://www.programmableweb.com/api/amazon-product-advertising

    1. check open source libraries for new ways to allow your users to visualize data

    https://github.com/d3/d3/wiki/Gallery

    https://observablehq.com/@d3/zoomable-sunburst

    Give users something they have never seen before

    https://threejs.org/examples/#webgl_interactive_cubes

    Its not about those guys..its about the tools and empowerment you offer your users BEYOND your MVP .

    1. 1

      This is really useful and I will read all of that carefully, thank you so much.

      I have a lot of plans for the "after mvp" moment, maybe a way to improve is to brings the plans closer in time