Ignore Startup Competition. Mostly*.

Paul Graham’s latest essay contained a very interesting interesting piece of advice in the footnote:

We currently advise startups mostly to ignore competitors. We tell them startups are competitive like running, not like soccer; you don’t have to go and steal the ball away from the other team. 

Graham is spot on with the advice to focus more on your own race than your competitors’. In many markets that startups compete in, the broad themes and product characteristics that will help a company win are evident via customer & prospect feedback, examples from similar markets and common sense. For example, in the payments gateway & processing market, those broad themes are:

  • Simplify payments (easy to integrate, easy to maintain, easy to understand)
  • Maximize usefulness of payments (data, insights, combination with other systems)
  • Minimize cost of payments (decrease risk, increase efficiencies)

However, it is the exception in Graham’s advice that is quite interesting: “mostly to ignore competitors” [emphasis mine]. In most meaningful technology markets, high quality competition will exist. Without losing focus, pay some attention to the competition. Among other questions, ask yourself:

  • What is the competition doing that you are already doing yourself?
  • What is the competition not doing that you believe is important?
  • What features and functionality are customers responding to favorably?
  • What features and functionality are customers ignoring?
  • What are customers and prospects saying about the competition?

These questions and your team’s discussion around them will lead to important insights about your company, your products and your roadmap. Build your product with your ideas as the core, while incorporating valuable information that is surfaced by a competitive marketplace. Do what the most successful technology startups (Google, Amazon, Facebook, Dropbox, etc) have done for ages: Look, Listen, Learn. Release. Repeat.


Note: Cloning a competitor’s product is not a strategy for long term success. If they’re already winning with their product, it is likely because of a unique combination of company DNA, timing, location, customer base, plus a million other factors. Odds are that they’re going to continue to win if you simply ape them.

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