

Other startup got there before me. Stop or continue? - uptownben

For the past few months I've been hard at work implementing this great iPhone app idea my wife and I thought of. This morning, while reading through my usual tech news, I found an article about another startup that has already implemented the same idea and has just received significant funding. Needless to say, I was pretty disappointed and frustrated. They created a really great app with all the features I was working on. At this point I think I need to make a decision, either drop this project or push on. They are a 20 person team with a few million in funding and I'm a one man shop without. What's your opinion?
======
erikstarck
I wrote a blog post about this a few weeks ago:
[http://blog.opportunitycloud.com/2009/12/21/stealth-
disease-...](http://blog.opportunitycloud.com/2009/12/21/stealth-disease-and-
first-mover-paranoia/)

Summary: "The cure for the First Mover Paranoia is to not view competitors as
impassable roadblocks but as a verification that the idea actually works and
has a market. That is in fact great news! Now the challenge becomes to find
holes in the existing market (geographic, pricing, quality etc.) or to improve
on what the competitor is doing."

~~~
mschy
Agreed.

Find a portion of the target market that is unserved, or poorly served by
their app, and differentiate your app to appeal to them. If this means making
it narrower, good.

The only sort of competition I'd strongly discourage is straight-up head to
head competition. You have to differentiate yourself somehow, even if not on a
technical dimension.

------
brk
Keep going.

Although, if your disposition is such that you get discouraged from a _press
release_ , you should stop and assess if you really have the personality and
disposition for such a marketplace. Rarely ever do you see a successful
marketplace with only enough room for a single product/solution.

There is no free lunch, and an "overnight success" takes an average of 3 years
to build. Along way will be many roadblocks, distractions and false alarms.

Good luck.

~~~
gommm
And anyway, in the worse case if after launching the app it doesn't become
successful, you can always leverage it to get well paid consulting developing
iphone apps.

And consulting gigs are a great way to keep afloat while developing your next
products :-)

~~~
z8000
Indeed! I made one iPhone app last year, gave it away for free, got a lot of
exposure, and have been doing enough consulting to (finally) leave my day job
@ Y! and focus on my own big (iPhone related) project.

------
DJN
It is easy to say "just go for it". In reality, it is quite risky.

Theoretically, it is possible to unseat a competitor like Google in search, or
Facebook in social networking, but you really have to know what you are doing.

In your case, a better approach is to do some customer development first.
Speak to potential users of your product. Find out if they are dissatisfied
with your competitor's offering. What will it take to switch.

After that exercise, you should be in a better position to make an informed
decision.

~~~
mrshoe
_What will it take to switch._

Why does he need anyone to switch? This competitor has just launched their
product. That means they have very few users and almost no brand recognition.
99.9% of the world will have no idea who launched first and won't care.

You don't need to convince anyone to switch from your competitor's product.
You just need to convince people to use _your_ product, which is a problem you
already had. In that sense, the launch of a competing product shouldn't affect
your roadmap at all.

Longer term, you should be worried about the huge imbalance in resources.
That's solvable, though: if you get any traction with your product you can
raise funds and hire a team.

------
maxklein
Nobody should work for months on an iPhone app. The platform is not friendly
to that style of app. Work for weeks, launch and test.

~~~
CamperBob
Counterpoint: an iPhone has about the same computing power as the first-gen
Xbox. People _will_ eventually put a commensurate amount of development effort
into it, and you _will_ have to compete with them.

~~~
mattmaroon
The problem isn't the iPhone's specs, it's the distribution network.

~~~
CamperBob
It would be a grievous mistake to assume that the current limitations of the
distribution network will remain in place forever.

~~~
jfarmer
So? We're talking about building iPhones apps today, not two years from now.

------
csuper
Keep pushing on. You should be encouraged that the idea has competition, I
think that gives it merit.

Also - their large team and funding could actually limit them. You will have a
lot more freedom to build what you want.

~~~
ams6110
They are also now beholden to their fund sources... that kind of money does
not come without strings.

------
Tawheed
Its not the idea of the product that counts, its what your vision is for how
you want to solve the problem in your own unique way. If you're tapping into a
real market, there will be tons of products that promise to solve the problem;
you have to believe that your way is the best way to solve the problem.

If you don't believe the above, then don't bother. Go get a normal 9-5 job.

~~~
mschy
_you have to believe that your way is the best way to solve the problem._

I disagree. You have to believe that your way is Good Enough.

Good Enough plus effective promotion equals sales. Best is a recipe for Duke
Nukem Forever.

~~~
Tawheed
Sure, if Sales is your only goal. I'm not talking about being a perfectionist,
but I'm talking about putting out the best product that you damn well can.

Why aim for mediocre?

~~~
mschy
Good Enough isn't mediocre, it's good (enough).

If you're selling to NASA, Good Enough might mean you machine it to the
thousandth of the inch, with the best possible materials.

If you're selling to Joe Schmoe, Good Enough might mean you machine it to the
tenth of the inch, with materials purchased to trade off quality and price.

And both of those products might be just what their respective markets want,
once you look at availability, price, etc.

Good Enough is Good Enough.

edit: Besides, has anybody _ever_ seen a product where engineering didn't list
ways to make it better, if given more time and money?

------
uptownben
Thank you for the great comments everyone. I spent a few minutes playing with
their app. It's already on the app store and it's free (so much for
undercutting). While they've created a great app, I have a few ideas that may
give my version a good shot. I'm going to sit down and have a think, put some
more ideas together. Thanks again for the great input.

------
cedsav
It's not a zero-sum game. If they do well, it doesn't mean at all that you're
going to fail.

With a large team and large funding, your competitor has set for itself a very
high bar for success.

You, on the other hand, can declare victory by building something (some)
people want (TM), even if it's not making you a lot of money (assuming you
have other source of income).

------
slapshot
Amazon was not the first bookstore.

Google was not the first search engine.

Did they give up?

~~~
nurgleboy
Was it over when the Germans bombed Pearl Harbour! Well its not over now!!!!

~~~
mpf62
Was that before or after the Japanese did the same thing? I nominate you for
the Ignorance-Award. I've never read such a stupid/useless Comment on HN
before.

~~~
nurgleboy
Another attempt at humor fails on the internet. You've never seen "Animal
House", really?

------
NickWritersBloc
Keep pushing - the first mover has an advantage that depends on their own
abilities. I mean, Friendster still dominates, right?

------
fjabre
I would say it depends on the type of tech and solution you're dealing with..
If it's an interactive children's book for example then the tech or resources
required are minimal and it's more about your unique spin on the product than
what's behind it.

If you're talking about creating the next iTunes, something that requires
tremendous resources, or bleeding edge tech like Google Wave then you're
probably right - you just won't have the resources to compete. Those are the
kinds of products that a well funded company will always have a clear and
definite advantage in producing.

Somewhere in between the two extremes is a large grey area where with a little
bit of luck and determination anything is possible..

I would stay the course unless the financial burden is too great.. It's often
the case that when you keep working towards a project goal you find new and
interesting ways to tweak your product offering so that it becomes something
entirely different and unique in the marketplace..

As long as you think there will be real demand for your product then there is
always a chance to spin the marketing in such a way that makes your solution
stand out from the rest. Feedback is critical as well.. So don't be shy about
asking friends and family.

Your first concern should always be product/market fit not potential
competitors.

------
nfnaaron
Even if you never get a single user (doubtful), following an idea through to
completion is valuable experience. And as noted in other comments, you gain
cred.

------
jeffmould
I would say keep going. But take a close look at their app. Surely there are
differences between yours and theirs, or at least in the ideas you have for
yours. Competition can be good and this should not be viewed as a roadblock to
developing your app. As Erik points out in his comment, you should look for
the differences and how you can fill voids in the market for this app. Does
your app appeal to a different demographic, market, is the pricing better, is
the overall quality better, etc...? Capitalize on your competition's
weaknesses. You obviously have long term plans for your app, whereas your
competition may have just thrown it together and have no plans to upgrade or
just minimal plans to upgrade. They may be just testing the market with this
particular app. Capitalize on their market research and build a better
product. Set up Google Alerts for the app name to keep track of what is going
on with their product, but DO NOT let yourself get distracted by any chatter
at the same time. Use that chatter though to build the better app.

------
ivenkys
My 2 cents.

Stop or continue really depends on two things (a) Who is your competitor ? (b)
What market are you in ?

From your description your competitor albeit well funded is not established
and therefore has exactly the same problem as you - getting customers, this is
good. However, if your competitor is someone with deep "links" with Google or
Apple or MS or one of the other companies with cash, quit now. Check the
background of the founders of the competitor. What sort of track record do
they have ? Are they ex-senior members of google, yahoo et all ?

What market you are in matters a lot, is it a market that provides
opportunities for specialisation - Continue, are you already in a niche-area
of a large market - Stop. Can the market be expanded ? Is there an already
existing market with clear pain points or are you building a new one ?

Summary: Weigh your options carefully based on the competitor and the market.
All the best.

------
ulf
If you decide to continue, use the current developments to your advantage. So
your competitor does have significantly more manpower and financial resources?
Reduce! Cut some features, really look at their app and identify the core
components, checkout user acceptance and then focus on the parts where they do
not yet excel.

------
dennykmiu
Doing a startup is not unlike taking a long bike ride. You will fall off your
bike time and time again, either due to inexperience or obstacles along the
path. Now is the time to do an equipment check before you ride again. Don’t
try to restart your journey right away unless you are confident that you have
the physical endurance and the support of your family (i.e., your wife, as a
business partner and as a spouse). Think of your family, your health and your
startup as the three legs of your three-legged stool. If you wobble on one but
solid on the other two, then at least you have a fighting chance. If you have
any doubt on anything, now is the perfect time to walk away and blame it on a
broken bike. But keep in mind that as I have learned in my recent climb in
Africa, you don't get to the top of Kilimanjaro by stopping, you do so by
resting.

~~~
uptownben
Great advice, thank you!

------
mattwdelong
What is the functionality of your app? Get the MAIN functionality finished and
release, don't worry about the "other functionality" right now. Release in
small iterations, in amounts that a single person can handle. Follow this
process and continually release features and improvements based on user
suggestions.

It's ultimately up to how you feel with taking a risk, no one can tell you
what to do. If you believe in the product, other people believe in it and you
feel comfortable then go for it.

More resources on MVP:

[http://www.startuplessonslearned.com/search/label/minimum%20...](http://www.startuplessonslearned.com/search/label/minimum%20viable%20product)
[http://venturehacks.com/articles/minimum-viable-product-
exam...](http://venturehacks.com/articles/minimum-viable-product-examples)

------
cullenking
Keep going - we (ridewithgps) are up against several players in the same
market, two of which have significant funding and 10+ employees. I see those
as disadvantages, personally, as our small 3 person group can run circles
around most 20 person "bureaucracies" as far as implementation speed,
direction changes and business decisions. I don't need to talk to an analyst
who is developing requirement documents from some business person; we can go
straight to implementation, try something out and see what happens. Of course,
a single man shop is hard work once you realize how tricky marketing and UI
stuff can be ontop of a solid implementation, but it is far from unheard of.

Or, of course you could give up and wish you would have tried harder when you
look back a few years from now. I know which decision I'd regret more!

------
angelbob
Do you have a good way to differentiate yourself? You say "all the features I
was working on". Do you have a vision for something neat that they haven't
done? That would be the factor I'd worry about.

If not -- if they've really done everything you intended to do -- I'd drop it,
and take up a different project. If they're not scratching your itch, or not
doing it quite right, then there's room in the market, because somebody else
probably also has that itch.

To put it another way, would _you_ rather use the product you've been working
on (when finished) or the one they just released? If you'd rather use theirs
than yours, then they got it right and you're doomed. Quit. If yours would be
noticeably better, there's room. Continue.

------
pschlump
I built a successful angel funded start-up company. We had 2 other competitors
in our "space". One that had $10 million in funding and the other that had $50
million. We had $50,000 at the time. (Yes 50k). We continued. In the end with
customers in palace we had raised a couple of million in funding. We sold the
company. We were successful. Our competitors couldn't sell the company for
enough to even recoup the investment. They folded. They failed. One of them
was killed by the VC that funded them. Just because they have 20 people and
millions will not make them beat you. You may have the advantage. If you can
get to a profitable state you can overcome. Lots of markets can support more
than one product in the market. Don't quit.

------
ortichi
Continue!!! If your idea/product/service has a market, then it is likely that
competition will ensue anyways. Leaders in every field can reap huge profits
from an early entrance. the case of now defunct FreeMarkets (aqcuired by its
biggest competitor) in the procurement filed is one. Basically, FreeMarkets
invented the concept of electronic reverse auction to buy goods and services
using an internet based platform, back in 1999! Now, companies all across the
globe such as Ivalua [<http://www.ivalua.com>] have developed this same
technology and are selling on pennies to the dollar of what FreeMarkets use to
charge 10 years ago. My point is to persevere and try to ride the normal
product cycle.

------
v42134
Wow! Many comments, much of them valuable; learned a lot, truly. Not that I'm
making a summary, but one point is clearly missing...

Decision making is a matter of binary logic, either you go for it, or you
don't. From the theory of systems, for that kind of decision you must have one
universal "efficiency" criterion, which is, inexorably, money.

(1) Write down all the comments in this thread; number them; (2) Write down
all your own thoughts, along the above comments; (3) Assign weight factor to
each of the above; bring them to a single dimension (e.g. money); (4) Count --
an you get your decision. (5) If still unsure, go to #2 (perhaps you failed to
materialize an idea of yours in a formal way);

V.

------
imgabe
Are you working on it full time? If it's just a side project while you work a
day job, it doesn't hurt to soldier on a release you app anyway. If you can
implement the same features without the overhead of a 20 person team, you
could probably undercut their price.

------
Stasyan
I say keep going. For sure your app is different enough that there are people
who'll prefer your app.

I am in a similar situation. I thought of an idea about a year ago, 4 months
ago someone else implemented it. Still going to finish and release...

------
profquail
Can you launch before they do? It doesn't matter if they have more people or
better funding if you can.

Or, do you think you can execute the idea better than they can? There are
plenty of apps on the the app store released by big companies that are
garbage...if you can do it better, you'll take away some of their unsatisfied
customers.

If you can't do either of those, then I'd either try to find another angle to
beat them on, or recognize that I was going to be wasting time if I kept
pouring time and money into the project and move on to my next idea.

------
aaronblohowiak
You should go to the VCs that usually compete with the VCs that invested in
your competitor. This other groups' funding has created a "gap" in the
portfolio of other VCs that you could fill. There is the first-mover
disadvantage: they have to maintain backwards compatibility and they are now
deeply sunk into their UI and marketing. You can learn the lessons they get
from feedback. This is like free product testing.

~~~
uptownben
Didn't think about that. Any idea where I could find that VC information?

------
sga
You mention 'They created a really great app with all the features I was
working on'. Thinking about your use of the plural of feature, I'm wondering
if there is a way to pare down the feature set and provide a lightweight
solution (as a differentiator to this competitor)? What is the one (or two
features) that provide the real value in the app? Go for those one or two
features and make it very simple to use.

------
minalecs
keep continuing on. A good example I can think of is foursquare and gowalla.
When foursquare was first released they were getting major press and major
investors. Not sure how much later gowalla came out, but they are making major
moves now, and in my opinion is much better than foursquare. Obviously you
will have to come up with some differentiators, but there is plenty of room to
compete. good luck.

------
adityakothadiya
If the pie is big enough, then you'll have your share. It's unreasonable to
expect you to own 100% of your market. So if the market is big, there can be
many players. Even the idea/product is same, you can still have your own
presence.

Having competition just makes you work even smarter and harder than before. So
go for it.

As a matter of fact, I'm in the same boat as yours, and I'm not giving up!

------
renauldo56
You are toast against a machine with funding and a 20-person team, unless that
team is lead by incompetents or staffed with incompetents.

Sorry. But that's one of the main reasons why getting venture is a good idea:
part-timers or self-funders can't possibly bring the same resources.

~~~
sdh
wow, worst advice ever!

funding is not a guarantee of success. in fact, a funded team has a harder
challenge than the non-funded team. as soon as you take funding, the window
for liquidity shrinks dramatically. venture investors want their money to grow
by 10-20x. if things don't ramp in the way expected, then the investors will
walk away and the entrepreneur will be left with a business that can't sustain
itself and has to shut down. the more money involved, the less risks that can
be taken. chances are very good that this funded team will not exist in 2-3
years.

------
Murkin
Can you give a bit more details ?

Does: a) Your app require a large user base to be functional ? b) The appeal
increase with larger community ? c) Is useful on its own, regardless of other
users ?

There is a reason there are few facebooks and lots of shoe stores. What are
you ?

------
richardburton
If the app is out there now. Can you tell us which one it is? Perhaps all the
people on HN with iPhones can donload it and check it out. I'm not going to
say something simplistic like: "Competition is validation" but I'd love to see
what your idea was.

------
twalling
Keep working on it. If they launch before you, read the comments in the store
and see how it's doing, what are its shortcomings, etc. I think this type of
thing easily happens all the time. Rarely is there an idea that someone else
hasn't thought of.

------
wensing
It may be a lost cause, or not. See if they mess up. Regardless, forget
features-at-large and focus on the best features, which are:

1\. It works. 2\. It's easy to use.

You can always one-up in those categories.

~~~
mortenjorck
Yes and yes. The biggest part that's often overlooked in a product that _does_
something new is _how well_ it does it.

Don't worry about matching them feature for feature because they've got 20
people and you've got 2. Use your size and the fact that you don't have to
pass ideas through a meeting to your advantage. Study their product. Find the
weaknesses in their UI. Isolate the pain points. Make your product a breeze to
use precisely where theirs is kludgy.

Ultimately, people will prefer the better experience to the more feature-rich
one. If you can deliver the former, it doesn't matter how long they've been in
the market.

------
trusko
Difficult to say. If you feel confident that you can do better job and compete
with them, keep going. Otherwise don't waste your talent and move on. On the
other side, someone already said it - they may mess up.

------
alexro
Few months isn't that hard to sacrifice, remember sunk-costs and don't get
burnt out.

Edit: the bright side is that you know iPhone inside-out and seeing an
opportunity can start on something else pretty fast

------
keefe
It depends on how close you are to completion. How much of your codebase can
be repurposed to a less populated niche?

------
herrherr
If there is no competition, there is no market. So go for it.

------
riot
I've had a similar experience - it was pretty discouraging the first time but
I soon realized I should still go for it and trust I could come up with a
better solution.

------
jacopogio
stop your project but try to build on that concept and improve it. And let
them know

------
ramanujan
Be pragmatic and join them.

------
tjoozeylabs
post link to other startup

~~~
tjoozeylabs
also try marketing techniques along with the release of your app

------
hockeybias
Push on! ...Keep an eye on the other startup and modify your app.
Differentiate your app to leverage their weaknesses and your strengths!

