

Ask HN: Beaten to the punch by a competitor, advice? - atavis

I've been working my first startup application for a couple of months out of hours from my 9-5. Not long ago a competitor surfaced and released an application which is very similar to what I have been working on.<p>They are targeting the same market and the application has the same features.<p>From what I have read so far about them they have been very successful (both financially and with creating a community of users) and the application is gaining traction. While this somewhat validates my feelings about the original idea in that it has been a great success for them, I am unsure what to do now.<p>Do I continue working on my own application and release it in a couple of months? I am pretty sure that there is enough market for it but I am no expert on marketing (far from it in-fact).<p>There are a number of older style web applications from competitors, both commercial and open source, but I feel that these are over complicated or bloated and my application is a fresh take on those with a greater emphasis on usability and simplicity (not through lack of features!) which the new competitor also provides. From research I have conducted on those they also appear to be performing very well financially.<p>Does anyone have any advice? Is this sort of thing normal and should I just ignore them and continue anyway?<p>Thanks
======
tptacek
In 2003, me and a partner decided it'd be pretty neat if companies could
deploy firewalls that filtered AOL Instant Messenger, Jabber, and MSN IM, with
rules for users and groups, not IP addresses, and with automatic encryption
and message relaying to keep corporate secrets off the OSCAR servers.

Then AOL announced they were going to go release the same thing. We had pretty
much everything but the user interface done.

Like the man said, "In a situation like this, there's a high potentiality for
the common motherfucker to bitch out". We bitched out.

A few months later, AOL dropped the product. Akonix and IMlogic, two companies
that _didn't_ bitch out, went on to gross something like 30-40MM in revenue
each. I stopped paying attention to them; I assume they exited nicely.

Your competitors don't decide whether you're going to succeed. Your judgement
and execution do. We probably would have failed even if we kept moving --- our
hearts weren't in it. Is yours? If you have to ask whether you're going to
keep going, maybe you should do something else.

------
fallentimes
Two things:

1\. Respond to all user emails within 24 hours or less - even if it's just to
say "thanks" or "this should be released next month". Not only will you know
exactly what your users want; they'll tell your friends how quickly you
responded. And of course, don't ever ever use form responses/letters.

2\. Keep your burn rate super low. If you do that you're a cockroach - no one
can kill you.

~~~
nside
Couldn't say better. And as soon as they will feel your competition they might
buy you. That's probably the quickest way to exit?

------
menloparkbum
Go for it. One of the projects I am working on is Yet Another Photo-sharing
Site. Here in SF the first thing people ask is "Why? Why not just use Flickr?"

But when I leave SF, I tell people "I am making a photo sharing site, kind of
like Flickr, but how I want it." The response I get is "Sounds Cool - what is
Flickr?"

Sites like Fotolog and Photo.net and Photobucket eventually sold for way more
than Flickr.

The point I'm trying to make is that if the market is big enough, there will
be people who want to use your product, even if there is an entrenched
competitor. In fact, your competitor may not be as entrenched as you think.

~~~
furiouslol
Seriously? Yet another photo-sharing site?

Unless it's a game changer like fotonauts, you might want to change your game
plan.

~~~
menloparkbum
It's just a side project, but thanks for the words of encouragement.

~~~
furiouslol
Hey man. I didn't mean to discourage you. I just don't want to see you wasting
your precious development time. The most precious thing to a developer is his
time. So I don't want to see another developer spending a lot of effort on his
baby and yet it doesn't gain traction. I would rather the developer devote his
time to some project that is different and have a better chance of succeeding.

if your photo app is going to bring something radically different to the
table, then i say 'bring it on'

~~~
nostrademons
One of YCombinator's "Startup ideas we'd like to fund" was "9. Photo/video
sharing services." So there's _somebody_ else out there that doesn't think
Flickr/Photobucket/FaceBook is the last word in photo-sharing.

"...but how I want it" are powerful words. If existing products don't do what
you want, and you can find a way to make them do what you want without a huge
team and lots of $$, why not?

~~~
furiouslol
Like i said, if his app brings something different to the table like
Fotonauts, bring it on (read my first post: I said change the game plan only
if it offers nothing different over the existing services. I didn't say forget
about the idea).

It's just that I've seen too many startups doing photo-sharing sites (admit
it. You've seen your fair share of them) promising something different but in
the end, they offer nothing compelling over the current services.

It's like someone saying they want to build a craigslist killer because of all
sort of cool features that they can't do with craigslist. And when they launch
it, yeah they're right. There are some cool features that they can't do with
craigslist like advanced filtering but these are not compelling enough to
differentiate themselves.

------
zacharye
Definitely don't ignore them. Learn from them. Do all you can to see what
works for them and what doesn't. Pay close attention to what users (and blogs)
are saying about the product. What do they like? What do they dislike? What
features are they asking for? This competitor will give you they best market
research money can buy - for free.

~~~
astrec
...and then execute with the speed of a-thousand-startled-gazelles. Some wise
lisp programmer once said - I'm paraphrasing - that one of the reasons his
company was able to compete in a market of 30 odd players was that they could
often duplicate a new feature within a day or two of a competitor announcing
it in a press release.

You're small and unencumbered, and if your heart is really, truly in it,
bloody dangerous. Good luck.

~~~
ovi256
> Some wise lisp programmer once said - I'm paraphrasing - that one of the
> reasons his company was able to compete in a market of 30 odd players was
> that they could often duplicate a new feature within a day or two of a
> competitor announcing it in a press release.

That was YC's own Paul Graham talking about ViaWeb i think.

~~~
jcl
Yes, it's from his Beating the Averages essay:
<http://paulgraham.com/avg.html>

------
matthewking
I've been reviewing web apps recently for accounting within my startup,
there's a lot of offerings and most of them cover all the same functionality.

But even though they all do the same thing, its the _way_ that they've
implemented the functions that makes each app different, and has ultimately
influenced my decision.

At this point, I have no idea what one came along first, that doesn't matter
to my decision, and I didn't just pick the first one I found, I reviewed 5-6
before making a choice.

Another point is, that after your initial release hopefully you'll get a user
base who will provide you with feedback and ideas, its up to you how you act
on that feedback. You may react to your users differently than your
competitors, and ultimately that too will distinguish you from them further.

Good luck!

~~~
mechanical_fish
I had the very same experience recently. I tried a couple of different web and
desktop apps for time tracking before settling on Harvest, which I like.
Harvest isn't _obviously_ better than the others, but there are subtle ways in
which it works that fit _me_ well.

Web apps are easy for users to try out for a while. So build a couple of
differentiating features and see if a subset of the (apparently lucrative!)
market tries your site and sticks with it.

~~~
auston
Would you mind highlighting what features you liked from harvest that were
unavailable in different apps?

~~~
mechanical_fish
I wish I remembered the details. Seriously, it was subtle enough that I've
forgotten.

The Dashboard widget for recording your time was one -- Harvest's is nice,
especially because you can easily switch from client project to client project
with the UI. But the thing which ultimately switched me over was the ability
to fully customize the line items on invoices -- I was able to get the style I
wanted with a few clicks, and I can easily edit and merge line items if I want
to. For me, it hits the sweet spot between doing things automatically and
allowing you to edit things.

Of course, once I switched over to Harvest I gradually became subliminally
aware of other reasons to like it. I haven't found myself wanting to try out
anything else.

------
mattmaroon
Wrap a dead fish up in some newspaper. Mail it to them with a kind but clear
warning that they better pack it up and go elsewhere.

~~~
shard
I doubt the efficacy of sending someone salmon steaks. How about live fish
wrapped in newspapers instead?

~~~
mattmaroon
Obv you've never smelled a two day old fillet.

------
furiouslol
I'm probably going to be the sole wet blanket here.

Ask yourself this question. Will your product be substantially different from
this competitor's product?

If yes, you might want to do something else. Like what you said, this
competitor has growing traction. It'll be difficult for you to break the
momentum especially if you provide nothing different.

If you really want to fight with this competitor well, you must offer
something different to the users. Eg. tumblr or posterous is like a super-easy
lite version of wordpress. That's why they're gaining traction. There are
probably XXX number of blogging systems out there that are similar to
blogger/wordpress and they just can't break through. Those that broke through
differentiate themselves well from these existing services.

dropbox is not like the hundred other online storage site. Their interface is
brain-dead simple compared to the competition.

Will your product be so? That's the question you have to ask yourself.

I'm not saying this to be a spoilsport but to help you prevent wasting your
precious development time.

~~~
furiouslol
Takeaway point is similar to what the others have said:

\- Learn from your competition and differentiate yourself from them

\- There are competitors all the time. So learn to live with them and out-
execute them.

\- Being late to the party is not a problem as long as you execute well (See
dropbox)

Another good example is Box.net. They were in a crowded space. They were not
first but they differentiate themselves from the competition by offering an
easy + social UI that makes sharing fun. It all boils down to execution.

Good luck with your project!

------
oldgregg
Large markets almost always have room for a #2. However, unless you can make
substantive improvements over their product or target a different niche that
they are missing, you could be in for a hard slog.

------
ojbyrne
I saw reddit as a digg.com competitor when they launched. Much, much smaller,
less hyped, but guess who found an exit first? Small competitors to large, VC-
funded products often do well, perhaps partially helped by the hype
surrounding the leader. Jaiku would be another example.

------
run4yourlives
Of course it's normal. Ask everyone from Pepsi to Burger King. :-)

That being said, from the sounds of it, the competitor seems to be very
visible in the market. Given that, can you see that there is something that
they're not doing? Is there are group of users that are under-served? Do you
figure one might surface? It looks like they've got you beat feature wise, but
can you go the other way even further? (Super simple?) These are areas that
you can explore.

At any rate, keep going. You idea has been validated. It's a big world out
there, odds are in the next two months you'll understand that there will be
room for you, them, and probably a few others.

Good luck.

------
wheels
There will always be competition. There are probably half a dozen other
companies doing similar things that you just don't know about yet. Most of the
really successful companies that I can think of weren't the first ones on the
market.

Like others have said, learn from them. Figure out some need that they're not
addressing and sure up that niche and try to grow from there. That may
actually lead you to a point where you're not going head-on against them, and
even if it doesn't it'll give you some runway before you're really going one-
on-one.

------
jonny_noog
I would definitely suggest that you not give up development of your idea.

As someone else has already said, learn from your competition and make your
product better as a result.

If the idea you're working on is a good one, then you're almost bound to have
competition. So I see competition as a sign that I'm on the right track.

Keep at it! You just have to make your implementation a little bit better than
the other guy.

------
13ren
Competition also validates the market in that some won't buy unless there is
more than one supplier; the first doesn't always win (Edison had the 19th
light bulb patent); and your greatest competitor is non-consumption (not this
competitor).

There's one danger in learning from them: don't become fixated or intimidated.
What you have to offer is your passion for that "fresh take", which is still
your original idea, and is still real, and is still needed by people.

It will turn out that your "fresh take" is not identical with theirs - non-
identical features, non-identical audience. It could be that yours is better.

Marketing is important - if you are "far from" being an expert, one way to
gain experience is to have a go.

I want to encourage you, but courage is only needed because of the unknown. A
start-up is high-risk, with many risks and many ways to die. A competitor is
just one of them. But fortunately, the plurality of risks doesn't really
matter, as you can only die once.

------
olefoo
If the market supports a number of competitors that are doing OK, and you are
fine with working in that market, then go for it.

If you were wanting to be a category-killer then it doesn't sound like your
market is suitable for that. So if you're playing "Go Big or Go Home."; you
should find another market.

~~~
iamdave
Right. The good thing about markets is that there are always options. There
isn't one brand of dish detergent, one brand of cookware or one brand of
bacon. "Go big or Go Home" is a bad mentality to get into because you're going
to find yourself worried more about what other people are doing, worried about
failure, instead of worrying about what you should be doing.

~~~
olefoo
I was specifically referring to the book by that title, which you should at
least glance at if you are doing a startup.
<http://www.gobignetwork.com/products/GoBigBook.aspx>

Basically, if you are going that route, you want to be the 80-ton gorilla in
your market, you want to be first, biggest and most; you want to be Amazon, or
eBay, or Google; not booksamillion, or ask.com.

From a distant perspective, it doesn't really matter if you build a world-
changing, industry-creating, market-dominating company or a niche lifestyle
company.

But if you aim low, you'll hit low.

------
drawkbox
Google wasn't the first search engine.

------
metajack
If you believe in your idea, keep going. While they may have hit first, you
can adjust your strategy now that their hand has been played.

This sort of thing happens all the time; few ideas are truly original.

------
Eliezer
Ask Graham's Question: Are you still creating value? Take your eyes off the
greenbacks for a second - are there still more-satisfied users at the end of
your quest, or is it now _only_ about the money?

------
TCL15
You should look at this as a good thing. You can use them to see what work and
what doesn't. Adjust your product and add features that your competitor lacks.
Any market worth while will have competitors.

------
leonroy
Paul Graham mentioned in one of his essays that although ViaWeb faced tough
competition he knew that working hard enough, his team could implement
features that would force his competitors to drag themselves over rocky
terrain just to try and keep up.

If you think there's a chance in hell, give it a go. Otherwise you'll always
wonder 'what if...?'

------
NoBSWebDesign
If you love what you do, keep doing it. Improve upon what they have, whether
that be the customer support, the interface, an extra feature or two,
integration with other services... competition is good for you.

------
blader
If you are screwed because somebody beat you to the punch - then you were
screwed anyway. Sustainable companies have a lot more going for them than just
being a few months early than the other guy.

------
vaksel
there are millions of people in this country. Even now when I tell people
about craigslist they ask what is that? There is always place to compete.

I mean look at eBay, they are in world known, but their user base is only 144
million people world wide. Sure it sounds huge, but in reality its just a tiny
portion.

As long as there is no first comer advantage(i.e. how eBay pretty much has a
monopoly on auctions), you can launch a decade later, and still manage to get
up on top(i.e. Google)

------
rtf
You have the "second move" in this chess game of monopolistic competition.
Even highly successful, technically superior, first-to-market products have
been beaten out by competitors.

------
umangjaipuria
It's not as much about the idea as about the execution. But your idea has been
validated. And so has your idea-generation. Quit your 9-5 and start off on
this full time.

------
splenda
What kind of application is it? How you would compete depends a lot on the
nature of your audience.

------
JD12
Profit, is the 100 pound gorilla. Can two company survive and make money both
at the same time?

------
rokhayakebe
If you have same set of features, then beat them on the UI.

------
pageman
what's your exit strategy? For example, if you were planning on getting bought
let's say 100M - with a competing company, that might mean you might get
bought for higher or lower depending on the timing. Assuming a bidding war, if
someone buys your competitor first, the losing bidder might just buy your
company for roughly around the same price (or higher) for PARITY. It probably
helps to stick around.

