The 3 Competitor Rule
Posted on December 19, 2013
Last week in San Francisco, I played a game with several people where I would pitch a company in Waterloo and then ask for someone to name as many companies as they could that were attempting to solve the same problem. I was blown away by the answers because almost every single time they were able to list at least 3 companies who were in that space. The companies named might have been trying a different approach or using different technology but were ultimately attempting to solve the same problem. Even more interesting, I attempted to search for these companies afterward on Google using the problem or solution (not the company name) and failed miserably.
Based on my experience, I am suggesting a new rule. Assume there are 3 competitors right now that you have never heard about who are trying to solve the exact same problem you are trying to solve. You may have some advantages (I hope you do) such as better technology, a better team, a better understanding of the problem or better access to customers.
With this new rule, the big question is how do you change what you do every single day in your startup? Does it make you want to move faster? Does it create a sense of urgency? It should!
Competition is an important part of the game and I never encourage teams to make decisions based on what their competition are doing. However, that doesn’t mean that you should sit back and feel like you have all the time in the world because you don’t know of any competitors in your space.