Startups: Obsessing about your competition

Competition is a good thing. It’s shows there’s a market and “it keeps you on your toes”. However its very easy to become completely obsessed with your competition. An obsession, particularly one which dominates your thinking, is never a good thing. It ends up wasting time, energy and is very frustrating. The thing really to focus energy on is understanding and adapting to your target customer needs.

Its so easy for startups to become completely obsessed with many aspects of the their competition:

1. Price – Since the Web everyone can see each others published pricing. There’s pressure to be cheaper than your competitors because customers can so easily compare  suppliers. Remember customers don’t just buy on price.
2. Features – The Web has also made it simple to compare suppliers features. You can become obsessed with needing every feature your competitor has. It’s so easy to forget the customer when focusing on competitors. Understand which features customers really value.
3. Size – How many customers do they have, what is their market share, what are their revenues, etc. Becoming obsessed with competitor size is very destructive. It leads to land grab at any cost.  Remember the saying “volumes are vanity and profit is sanity.”
4. Buzz – Being obsessed with your competition means your always waiting and watching for every piece of press on them. Great press coverage is important  but its the customers perceptions that really counts. Lots of press noise does not necessary mean lots of happy customers.
5. Location – Over and over I hear people obsessing about location. They constantly compare the benefits of being is a different location. Usually one they’re not in. Don’t get me wrong location is important but getting hung-up over it is no help. Customers are everywhere. Focus on them.

Our startup has got more competition than you can shake a stick at! However it is vital we have competition. They validate the market need and help to grow the overall market sector through a courus of marketing messages. Competitors give a startup a known quantity to position a product against with customers i.e. ‘it’s like…’ They also bring a measure to set yourself against.

However becoming obsessed with your competition is counter productive. Forgetting about them is not a good idea either. They may start addressing a customer need which takes away your customers. In reality it is unlikely  your competition which will kill your startup. There are lots of other challenges that will do that, especially not understanding adapting to your customer needs.

What has LinkedIN done for you lately?

After much networking over the last two years I’ve now reached LinkedIN’s 500+ connections. I’ve followed up every new meeting with a personally edited LinkedIN connection email. Was it worth all the time and effort? It was. The time investment  has demonstrably helped our startup  more than once. It’s also re-connected me with many long-lost colleagues.

Many people have said to me that LinkedIN‘s only good for recruitment. They’re right, it’s great for that. However its great for other things too. LinkedIN has help us find freelancers. We needed a web developer and designer last year for our Web site monitoring application startup Aware Monitoring. Without my LinkedIN connection to the lovely Mel Kirk, made after meeting her at the FOWA conference in 2007, we might never have found Luc Pestille. And Luc did a wonderful job for us 🙂 Before choosing to work with Luc we looked at 11 other developer designers, many found via LinkedIN.

LinkedIN is excellent for helping to understand and profile people.  Whether they are business partners, suppliers, competitors or potential customers. The information brings great intelligence quickly and effectively. It’s now so easy to find out who’s the CTO or CEO of a company. A very useful tool to identity new contacts within potential customers. LinkedIN also helps maintain weak tie relationships and friendships when people change jobs. I’ve spoken, emailed and met-up with many old friends and colleagues since using LinkedIN.

LinkedIN have cleverly made it worth your while putting the effort into growing your network. More connections brings a greater visibility to 2nd/ 3rd degree contacts. Your loose tie network grows!  In theory I now have over 5million 3rd degree connections.The founder and former CEO Reid Hoffman has tapped really well into the ideas of ‘six degrees of separation‘, ‘network effects‘ and ‘business social networking‘. Hoffman and LinkedIN have done great job in making a  useful business social service!

UPDATE: Ian Brodie and Webex have carried out a poll on ‘How to Use LinkedIN to win new business: poll results’ – these interesting and useful results echo my personal findings.

Life, death & startups..

How many times have you heard the saying life is Too short. Thing is, there is much truth in this. Jeffery Walker’s recent untimely death from cancer and seeing the movie The Curious Case of Benjamin Button got me really thinking about life and death. It’s also got me thinking where startups fit into life’s equation. Life’s challenge is we only have a short time to work out what we really want from it. In many ways having a startup or fulfilling your dreams brings  self understanding, personal growth and even enlightenment.

The final words in life (Blade Runner, 1982)

Entrepreneurial stories and the movies are a great reflections of life. The alter ego fictional Fight Club character Tyler Durden said “This is your life, and it’s ending one minute at a time.” Reflective life films and the death of someone you know creates self-reflective questions.  Are you happy living the life you live or would you rather being doing something else. Would you rather have a different job? Or desire a startup company?

“First, you have to know, not fear, know that someday you are going to die. Until you know that, you have no sense of urgency. You think you have all the time in the world to do amazing things, but you may not live to see that particular someday.” Another Tyler Durden quote

In Steve Jobs wonderful speech after surviving cancer “Your time is limited, so don’t waste it living someone else’s life”. Steve went onto repeat Breaker Morant quote, which he’s lived by since the age of 17,  “Live every day as if it were your last and then some day you’ll be right.”

I’ve found in life that when you’re doing  something new and challenging in an intense short space of time period, time  seem to slow down. Learning and keeping your experiences new and fresh is so important in life.  It brings a life full of rich and varied experiences. Paul Graham says that working in startups “seem like time slows down”. It’s because there is such an incredible amount to learn in a young company. Paul goes onto say in his great 2006 essay post The Hardest Lessons for Startups to Learn:

“..there’s nothing particularly grand about making money. That’s not what makes startups worth the trouble. What’s important about startups is the speed. By compressing the dull but necessary task of making a living into the smallest possible time, you show respect for life, and there is something grand about that.“

The character Benjamin Button said “When it comes to the end you have to let it all go.” Why wait until the end when it’s too late.. We can all choose what we do with our lives, no matter what our age is. “Every passing moment is a chance to turn it all around.” Look forward and don’t dwell in the past or you will just stay there lost. We can choose to hold onto negative emotions such as fear, doubt and anger or let them go and fulfill your dreams doing something you really enjoy.

I regard making money as a boring errand to be got out of the way as soon as possible. There is nothing grand or heroic about starting a startup per se.

The challenge in life is that  we only have a short time to work out what we really want from it. Some would call the discovery of a life’s purpose or understanding as enlightenment. Wikipedia defines ‘Enlightenment broadly as wisdom or understanding enabling clarity of perception‘, ‘full comprehension of a situation’ and ‘a state of freedom from suffering, desire and ignorance’. In many ways having challenging experiences and doing something you love brings deeper self understanding and personal enlightenment.