I think everybody who's been through the startup game knows this point: You've been quietly working on something you think is novel for months, planning to take over the world any day now. And then there's the painful moment where you realize there are others doing something similar.
We just hit that. There are two groups, both with unlaunched products. They've got bigger teams. They've got more money.
What do you do? We were tentatively planning on a public beta for the first useful application about a week out. Neither of their groups has that. Should we focus on differentiation or try to build momentum for a head-on collision?
We've been keeping quiet about what we're doing because we're not ready to launch yet, but they've just started breaking radio silence. Should we care? Should we start making noise?
Looking forward to your answers.
Additionally, the competition might not be all that bad for you. They may help flesh out the market for you. You might be able to ride on their press and their advertising dollars. You might get ideas from their products.
Finally, pretty much all good ideas will attract competition. That is the nature of a free market. So it was going to happen sooner or later. The good news is that there is usually room for multiple competitors in a market. And in the low-cost startup world, I haven’t seen any great evidence that bigger teams and bigger money win out on average after you control for the # of startups in each category.