Loading...
Answers
MenuI have been developing an idea on my own for sometime now. Recently,a potential competitor has surfaced. Should I reach out to them? What should I do?
I have had an idea (an app) in my head for several months now and I've done some preliminary market research on my part. As a non-programmer I have been trying hard to develop a mvp so as to get it out for feedback asap. However, the imminent threat of a potential competitor with much better resources and coding technical skills is looking to enter the same arena. I am not sure if I should stay on and compete with them or not. All advice are welcome. Thanks.
Answers
Here are your options:
You can only compete with them If you're able to either:
A) Get a programmer:
- Either raise necessary funds to hire one full time. See my answer on ("When is the right moment to approach investors?")
- Use your own funds to hire a freelancer. See my answer on ("How do I get my game from Prototype to Demo?")
- Or convince a developer to join you as a cofounder for equity. See my answers on that topic ("Where do I find a co-founder to join my team?" --And-- "How and or where do I find a stellar Partner/CEO")
B) Learn how to program it yourself, and program it yourself
- Either have enough time and motivation to learn programming fast enough (could be very difficult, depending on how far along you are, and what you're trying to program)
- Or there are several methods you can potentially use (depending on the complexity of the app you need) to make an MVP without programming. For instance MIT App Inventor (http://ai2.appinventor.mit.edu/), or Marvel App (https://marvelapp.com/)
Otherwise:
A) Either see if you can join the competition. If you contact them and can convince them that you have something to contribute, they might let you join the team. See my answer on that topic ("How do I approach a business with an idea?")
B) Or come up with another idea, and see if you can do steps A or B before someone else starts implementing the same idea
Send me a message if you want to discuss any of these, or other options in more depth.
In any case, I wish you the best of luck,
Lee
Lee is pretty much spot on here. You can do what it take to compete, try to join them or find something else and move quickly. And don't worry, there is always something else.
Well, the harsh truth is that you don't have much. An idea isn't much. A little market research isn't much.
Action is what makes thing happen.
And half-done ain't done.
On the positive side, what has your competitor actually completed?
Or are they still in the 'thinking' stage, too?
Ultimately the best marketer will win...not the best product.
Do either of you have actual BUYERS lined up? Or are you hoping and praying people will buy?
From the investor perspective, it doesn't seem like you have much at all right now. My advice is to worry less about what your ethereal proto-competitor is doing, and concentrate more on getting your own work done. Finish the product and start marketing it. Get sales.
Great you have been considering starting your own business! Very few things are more exciting :)
Now if we summarize the situation: you have an idea , your competitor has a product. I wonder what is the difference between you and your competitor... what is the barriers that for many months didn't allow you to put together a MVP. I guess it's the lack of one of the below (maybe a mix?):
- Money
- Time
- Knowledge (on how to overcome technical or strategic challenges, on how to maximize your money and time, for example)
I can help you, if you want to:
1. Assess if it's worth for you to stay and compete based on their and your offer
2. Established an action plan that will allow you to launch in 3 months time
Looking forward connecting with you,
Serena
Agreeing with all the other comments, Other questions to ask are: What are the gaps in the competitor's product? How can your product fill the gaps? Can your product be a complement to their product (if they sell more, piggy-back off that so you sell more with them)? Can your product do a deeper dive in solving the customer's problem (pick a finer aspect of the solution to delve into instead of trying to do a broader solution)?
Competition doesn't have to mean head-to-head equal products duking it out. How can you work with the competition instead of against them?
Then TAKE ACTION!!! Everyone has ideas. Very few people act on them. In the land of app development, waiting a month is too long. There are precious few unique ideas out there, only limited people acting on them.
Related Questions
-
What legal precautions can I take to make sure nobody steals my startup idea?
I've discussed ideas with hundreds of startups, I've been involved in about a dozen startups, my business is at $1M+ revenue. The bad news is, there is no good way to protect ideas. The good news is, in the vast majority of cases you don't really need to. If you're talking to people about your idea, you could ask them to sign an NDA ("Non Disclosure Agreement"), but NDAs are notoriously hard to enforce, and a lot of experienced startup people wouldn't sign them. For example, if you asked me to sign an NDA before we discussed your Idea, I'd tell you "thanks, but no thanks". This is probably the right place though to give the FriendDA an honorable mention: http://friendda.org/. Generally, I'd like to encourage you to share your Ideas freely. Even though telling people an idea is not completely without risk, generally the rewards from open discussions greatly outweigh the risks. Most startups fail because they build something nobody wants. Talking to people early, especially people who are the intended users/customers for your idea can be a great way to protect yourself from that risk, which is considerably higher than the risk of someone taking off with your idea. Another general note, is that while ideas matter, I would generally advise you to get into startup for which you can generate a lot of value beyond the idea. One indicator for a good match between a founder and a startup is the answer to the question: "why is that founder uniquely positioned to execute the idea well". The best way to protect yourself from competition is to build a product that other people would have a hard time building, even if they had 'the idea'. These are usually startups which contain lots of hard challenges on the way from the idea to the business, and if you can convincingly explain why you can probably solve those challenges while others would have a hard time, you're on the right path. If you have any further questions, I'd be happy to set up a call. Good luck.David KatzDK
-
Business partner I want to bring on will invest more money than me, but will be less involved in operations, how do I split the company?
Cash money should be treated separately than sweat equity. There are practical reasons for this namely that sweat equity should always be granted in conjunction with a vesting agreement (standard in tech is 4 year but in other sectors, 3 is often the standard) but that cash money should not be subjected to vesting. Typically, if you're at the idea stage, the valuation of the actual cash going in (again for software) is anywhere between $300,000 and $1m (pre-money). If you're operating in any other type of industry, valuations would be much lower at the earliest stage. The best way to calculate sweat equity (in my experience) is to use this calculator as a guide: http://foundrs.com/. If you message me privately (via Clarity) with some more info on what the business is, I can tell you whether I would be helpful to you in a call.Tom WilliamsTW
-
I'm having problems with ideation for a startup, I'm a web developer, what needs of yours aren't being met? Or how can I find a big problem to solve?
It's really ill-advised to solicit your vision from anyone. In my 20 years of building, investing and supporting tech companies, I don't know of a single success story that has it's origins in someone with your approach. Running a tech startup is incredibly hard. It demands sacrifices few are truly able to make and come with it tremendous risks that most people are unwilling to take. It sounds to me as if you want the startup life because you have an impression of what it's about but haven't yet experienced it first-hand. I'd encourage you to first join an early-stage startup. Developers are incredibly in-demand. Find an entrepreneur who has some experience, funding and a compelling vision that you believe in and get to know what the journey is really like.Tom WilliamsTW
-
As a startup, is it better to find a way to pay for services (i.e. design) or trade equity for it?
Before I get to your question, let me give you a tip: always aim settle questions of payment before the work happens. It is ten times easier to agree on a price beforehand, and having done that doesn't stop you from changing it by mutual agreement later. The problem with paying cash is pretty obvious: you don't have a lot of it. The problems with paying equity are subtler. The first one is that early-stage equity is extremely hard to value. A second is that equity transactions require a lot of paperwork. Third is that entrepreneurs tend to value their equity much higher than other people would; if not, they wouldn't be starting the company. And fourth, people like designers are rarely expert in valuing businesses or the customs of of startup equity valuation. In the past, I've both given and received equity compensation, and it's a lot more of a pain than I expected. In the future, what I think I'd try is convertible debt. That is, I'd talk with the designer and agree on a fair-market wage. E.g. 100 hours x $100/hr = $10k. The next time we take investment, the $10k turns into stock at whatever price we agree with our investors, plus a discount because he was in before the investors. Note, though, that this will increase your legal costs and your deal complexity, so I'd personally only do this for a pretty significant amount of work. And I'd only do it for somebody I trusted and respected enough to have them around for the life of my business.William PietriWP
-
How much equity should a CPO receive when joining a Series A startup that's been around for 2-3 years?
Hi There are various 'models' that you can use to estimate how many shares/percentages your new partner should get. These include (a) his/her investment in time and/or money, (b) the current + potential value of the company, (c) the time and/or money that you as the original founder already put in and various other models. That said, at the end of the day, it's all about value and psychology (both side's feelings). Bottom line: 1. It all really depends on how much value they are giving you (not only financial, sometimes even just moral support goes a long way). Some founder's 'should' get 5%, some should get 50% or more. 2. Ask the potential partner how much shares they want (BEFORE you name a number). 3. Have an open conversation with them in regards to each of your expectations. 4. Use a vesting (or preferably reverse vesting) mechanism - meaning that the founder receives his shares gradually, based on the time that goes by (during which he fulfills his obligations) and/or milestones reached. 5. If you want a mathematical method: calculate the value of each 1% of the shares (based on the last investment round), check how much an average CPO earns per month/year, and then you can calculate what % he/she should get for the 2-3 years they should put in. I've successfully helped over 350 entrepreneurs, startups and businesses, and I would be happy to help you. After scheduling a call, please send me some background information so that I can prepare in advance - thus giving you maximum value for your money. Take a look at the great reviews I’ve received: https://clarity.fm/assafben-davidAssaf Ben-DavidAB
the startups.com platform
Copyright © 2025 Startups.com. All rights reserved.
