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Did The 900-Pound Gorilla Just Vanquish Your Startup Or Validate It? (onstartups.com)
37 points by dshah on Feb 19, 2014 | hide | past | web | favorite | 9 comments

It usually validates the existence of the market, but not which part you play in it.

My last business was in a market with two very well funded, very large competitors. But they were only interested in the larger deal sizes, leaving lots of smaller customers completely underserved. After burning through a couple rounds trying to go toe-to-toe, we refocused on these smaller customers with new messaging, sales approaches and product and immediately had the biggest year we had ever had to date.

One of the other things we did with product was to try to bring capabilities only the big guys had, but in a cost efficient way to the smaller customer. This gave them an opportunity to compete on a bigger stage.

We were also able to convert some small customers into bigger customers as they grew. Having a long history with them kept us onboard with them and kept the bigger players out.

In anything, when there are only big players involved, there are always gaps that can be filled. It's why, despite there being Bing and Google, there's still domain specific search engines, or despite there being Sony, Microsoft and Nintendo, there's still space for companies like Hyperkin, Valve or Ouya to have a go.

The quote below is sooo relevant to me. It's what sidetracked me at my previous startup, getting caught up with what my competition was doing. I know better now. Listen to your customers. Iterate in THEIR direction. All else will fall into place.

>This is the most important takeaway. Sitting here a few weeks since Google’s launch, I can tell you with absolute certainty that nothing has actually changed. Looking back at the 6 years we’ve spent building BuySellAds, it’s clear that any time we spent thinking, researching, or reacting to our would-be competitors was a complete waste of time. In fact, there’s no better way to waste time than to think about (or even follow) what your competitors are doing. The only thing that truly matters are YOUR customers. I can’t tell you how hard it has been to get this engrained into my mind. It is by far the most important thing in building a business (to focus on your customers), yet so hard to practice when you see other activity and the glorious tech-headline touting presumed (or actual) success. They call it “customer driven development” not “competitor driven development” for a reason.

I've always thought that it was the 800-pound gorilla, so I thought that the OP just made a mistake, but no, the 900-pound gorilla is a thing: an article (http://articles.chicagotribune.com/2011-01-05/features/ct-tr...) in Chicago Tribune talking about the origins of the 800PG phrase has this:

Sometimes the gorilla surpasses a mere 800 pounds. ("Whose the 900-pound gorilla now?" asked a headline on a recent tech story about Facebook overtaking Google as the biggest web site in 2010. Sometimes the gorilla sheds a few hundred pounds. ( Colorado's governor-elect was quoted last month calling the state's billion-dollar shortfall "the 600-pound gorilla.")

For some reason, the 900PG is common in tech posts, this may be due to the effect of a rock band with that name. We may be witnessing a the emergence of a differentiation like the soda/pop one.

Wow. I had no idea. Though I'm not the author of the article, I came with the title. I didn't even know there was such a thing as an "800 pound gorilla".

Thanks for pointing this out. Learn something new every day.

Nice story. I've added to to my collection of articles that validates the view that Google is in a world of hurt with respect to meeting growth expectations with their Ad business. We've seen a continual (now 10 out of 12 quarters) fall of CPC, we've seen rapid expansion of "inventory" (additional ads on Google properties, and additional properties) and now we're seeing pressure on the Ad buy/sell markets directly.

I'm curiously waiting to see when that lands them in court (they are checking the boxes for monopoly, and abuse of same, as far as I can tell.) Microsoft got away with it for a long time, but eventually it whacked them hard. So when the Internet advertising space is artificially constrained by Google using its position in the space to control pricing or competition, I expect there will be legal action at that point as well.

There was a time last year when they banned us (BuySellAds) from advertising on AdWords. I doubt that it was any sort of intentional target toward us; however, it seemed rather convenient to ban us for having customer testimonials where our users spoke of earning more money through BuySellAds than through AdSense.

It took me a while (month or so) and dozens of emails to get our AdWords account un-banned by them, all while using the AdSense landing page to show the contrast of the language they use to advertise their OWN products and how it was much more aggressive than the language we use (through customer testimonials) to advertise our product.

We didn't read too much into it though, as I suspect they had better things to do than strong-arm a (comparatively speaking) super-tiny competitor.

Edit: spelling mistake

>> The truth is that if Google actually wants to compete with your business, there is a decent chance you will lose. Google wins everything.

Says who?

People used to say the same thing about Microsoft.

I think it used to be true about Microsoft as well. The adage doesn't hold forever, but we're in a time right now where Google being in a particular arena will tend to be more of a competitive beast than a market validator (it can be both, but it'll be perceived more as competitor). This might change again in a few years, but right now Google is a beast. MS used to be. The question might be do you have enough patience/money/runway to wait out that market shift to where you can be competitive again, assuming Google is in your market (many people couldn't outlast MS back in the 90s).

If you're talking B2B products, I would strongly argue that's still true. And remember, the winners in most markets aren't the first, it's the people who copy the first and have a way to sell it.

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