

Ask HN: What's actually "defendable" about web startups these days? - polymath21

For example, what's keeps Gowalla from copying Foursquare's features, and vice versa? Unless a startup is working on something truly revolutionary and highly technical, how would a startup answer the question: what's keeping competitor X from copying you?<p>The lack of an IP warchest for today's startups seems to me like a glaring weakness. And you can't answer with "our team", "the way we execute", etc. I mean something that's <i>truly</i> defendable. (I guess Facebook DID patent the news feed...)<p>Just something I've been thinking about lately, but have yet to find a satisfying answer for and thought I'd ask the HN crowd. Thanks!
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patio11
This question does not exactly keep me up at night, but if it did, my answer
might sound like "Our most important product isn't the one we're selling, it
is the processes we use to make and market the product(s) we're selling and
will sell in the future, and those processes are non-trivial and so
ridiculously superior to what the competition will be using that they will
_never_ catch up."

IMVU or Zygna are good examples of this. Neither has a patent wall around
them, either is about as well defended as any business based on computers can
be. The reason is that, while you can make your own Big-Chested-Anime-Chicks-
Farming-Together-Chat-Client in not a whole lot of time, you won't have their
creation process... and they're learning so fast about their markets that they
will _bury you_. The advantages they get from the whole lean startup thing --
fast learning and fast production -- are compounding, because it buys them
more traditional advantages like network effects, kickstarts their virality,
gives them money to buy insane amounts of FB advertising, etc etc.

This is totally not limited to these market segments. (If either of them were
in search-focused verticals I'd tell you about how this helps build the self-
reinforcing authority cycle for SEO, too.)

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gridspy
Also, you could clone their site, but you couldn't clone the underlying
understanding required to better it.

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lunaru
What keeps Coke defensible from Pepsi?

Sure, "execution" is a loaded word, but if you break it down, a successful
startup is a magical combination of marketing, product, design, distribution,
customer service, analytics, market knowledge, positioning, network effects
etc. All of which, when executed well, strengthens and reinforces a brand that
the end-consumer loves to rally around.

Your IP should be a means to this end, not the other way around.

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gridspy
Coke vs Pepsi? Patents and copyrights on the secret formula that makes it
taste non-crap.

But the rest of your points stand.

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davidcuddeback
Actually, Coke's formula isn't patented. Many say it's the best kept trade
secret in the world. They keep competitors from copying them by keeping their
recipe a secret.

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Mc_Big_G
Is it really that difficult to reverse engineer Coke's "formula"? I find it
hard to believe that, with the tools we have today, no company could create an
exact duplicate. Maybe the the real issue is that they could, but then
couldn't reproduce the brand.

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_ngw_
The only answer is the culture behind a decision. If you're doing things right
you are following a "plan" and solving a problem, a feature is your catch
about a possible solution. If your competitors copy it, you did your work
right, it means that you have a good knowledge of your userbase and generally
of the domain. The problem will never be a competitor copying you, it's if a
competitor implements your next feature before of you and the solution you're
coming up with is the same. At that point, you're not managing the rules of
the game anymore.

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rlpb
How about their customers/users or comprehensiveness of data? The biggest
thing that stops me moving from Facebook to competitor X is that all my
friends are on Facebook and not competitor X. Similarly, would you prefer to
use Foursquare with stuff and people already in your city, or competitor Y in
which your city is barren?

Of course this leaves many startups out, since this doesn't apply to them.

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imp
Why can't someone answer with "our team" or "they way we execute"? If your
competitor is always a step behind you copying features you wrote last month,
doesn't that guarantee that you'll always be ahead of them?

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noodle
not much. some stuff is defensible, but generally, success seems to comes from
being innovative and having a good team that executes well.

