Are Competitors A Problem, Or An Opportunity?

[One might think that a blog post like this in the midst of a major catastrophe makes little sense. However, the world keeps turning. It is tremendous to see our great city and province pulling together to do more than survive, and instead overcome these events. But there is little that I can do right now to help, and the world isn’t going to stop just for us. The best we can do is help where we can, don’t impede those who are helping, and carry on otherwise.]

A recent blog post on Startup North has some thoughts about competitors to your business. The thinking is interesting, and I concur with their observations. Their observations were primarily about how many competitors will somehow cease to be competitors. Their last point only obliquely points to what I think is probably the best and most important element of competition, and one that should get you excited, rather than be worried.

Validation

The appearance of competitors in your space, or the existence of them when you get started, is validation that you might be doing something right. It can be easy to obsess over trying to be the only provider of some product or service, but unless you can grow to truly massive proportions (relative to the space, of course), you are going to have someone to compete with. Any business model that depends on having no competition is one that is almost certainly going to fail.

If you are the only one in your space or market, you have to ask yourself “why is that?”. But why would I say that? Isn’t it possible that some product or service is truly unique, and that no one thought of it (or something like it) before? Therein lies the flaw of the “unique idea”.

Probability If Uniqueness? Almost Zero

The reality is that an idea is unlikely to be truly unique. I know this is over-simplifying, but if your idea is “1 in a million”, then odds are about 7,000 other people in the world thought of it as well. A lot of them won’t have the skills, experience or resources to act on the idea, so you wouldn’t necessarily expect to face 7,000 global competitors. But taking this perspective, as over-simplified as it is, can really put into perspective just how “unique” and idea is, or in reality, isn’t. This is, in part, why talking about your idea with other people is a good thing, rather than trying to keep it secret. It can help you validate that your idea does make sense, or if it might have a chance.

Beyond that, though, there are others that will see your idea at some point, and decide they can do better. The concept in the preceding paragraph is simultaneous invention. This second concept is looking at an existing idea and improving on it (or some may say “stealing it”, depending on your perspective). Even if your idea starts out as unique, in that no one else has tried to execute around it, someone is bound to look at what you do, and try to either duplicate it exactly, or try to do you one better. It may be a variation on your product or service, or they may simply decide to compete on price. The new entrant may be the incumbent in another space, and may use their existing brand or recognition in some way.

Either way, if you idea is any good, others will appear with the same or similar idea. They will want a piece of the pie. Truly unique ideas are about as rare as unicorns.

Embrace Competition

Face the facts: you are going to face some kind of competition. It may be direct competition, in the form of similar products or services. It may be indirect competition, in the form of products or services that are different, but are still viable alternatives. If your idea is worth anything, others will be out there trying the same thing. You can try to stop them, but you would be better served to do a better job than your competition. Money spent on lawyers trying to enforce patents or other IP provisions is money not spent on your product or service.

The presence of a competitor is actually helping you. It lets you point out to people that “see, someone else thinks it will work, too”. If that competitor is a major player in a related industry, that’s an enormous indication you might be on to somehting. Again, it’s validation that what you are doing might actually be useful, or make some sense. While the Startup North piece has some good reasons why not to worry about competitors, I think the fact that it’s a form of validation is more important any of the other reasons they list.

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