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Your competitors don't matter
When we started our first company, we were fresh out of MIT, where we’d all studied computer science. In short, we knew nothing about how to run a company. As a result, everything constantly felt like an emergency that had to be dealt with immediately, or the company would be doomed. Like most first-time founders, we didn’t yet have good intuition about the things that really mattered.
This was especially true when it came to worrying about our competitors.
Our first startup was called Ksplice, and we had technology that could install software updates without rebooting. It was based on my cofounder’s MIT thesis work, and was basically pure magic. As soon as we started the company, we set out to get our technology merged into the Linux kernel. The thinking was: if we were the creators of the official “rebootless update” solution for Linux, it’d be a huge advantage for the company.
First, a quick detour into the inner workings of Linux. Linux is an open-source project, contributed to by tons of developers across the world—folks at big companies, hobbyists, and everything in between. They stay coordinated via a mailing list: the Linux Kernel Mailing List. When you have a feature you’d like to propose including in Linux, you send an email to the mailing list, and the community provides its feedback. So we did. You can actually see the original email here, with a subject line of “Ksplice: Rebootless kernel updates.”
The reception to our email was… tepid, at best. The community requested a bunch of changes and were generally pretty skeptical and grumpy about the whole thing. (Incidentally, this is pretty par for the course for Linux.) But we didn’t let that stop us. We buckled down and got to work making the changes folks had requested, in the hopes of having our technology merged in on the next attempt.
Not too long after, someone else posted their own, different approach for Linux kernel updates—and did so in an email titled “kreplace: Rebootless kernel updates.”
My cofounders and I proceeded to have a complete and total freakout. What if their technology was accepted as the de-facto solution for updating Linux? Would all of our work become irrelevant? Would we have to shut down the business? Would we have to get real jobs elsewhere? Would we ever find happiness again?
To add insult to injury, they even copied our description. We invented the term “rebootless”! In short, what followed was a ton of wasted energy and worry that our startup was going to fail, all because of kreplace.
But at the end of the day, kreplace didn’t matter at all.
To be clear, it mattered literally 0%.
No impact whatsoever.
That’s the thing about competitors. They are, for the most part, irrelevant. Any time you spend thinking about your competitors is time you’re wasting, because you’re not focusing on what really matters: building a product that is good, that your customers love, and that they’re willing to pay you for.
In general, it’s rare for markets to truly be winner-take-all. (Two data points: Salesforce only has 21% market share, and Amazon Web Services only has 33% market share.) So even if there is a dominant provider in your space, as long as your market is big, there is still lots of room for you to grow.
This is especially true if your perceived competition is a new startup. In general, these other startups aren’t that much bigger or further along than you are, even if they are better-funded.
The world in which Google releases a feature that kills your startup is similarly unlikely, if nothing else because big companies move incredibly slowly. By the time they get around to cloning your business, you will have already succeeded or failed under your own power. (Dropbox came out in 2007, but Google Drive wasn’t released until 2012.)
Your actual competition
Your real competition isn’t your competitors, it’s the status quo.
Visa’s biggest competition isn’t Amex, it’s cash. This was true with our kreplace situation as well. We were concerned that the Linux community would adopt their technology instead of ours. In the end, they adopted neither—they preserved the status quo.
This continued to be true as we brought Ksplice to market. The biggest hurdles we had to convince you of were: (a) that our technology worked, (b) that you should change your workflow and use Ksplice instead of doing whatever you did today, and (c) that you should pay us for it.
It was never about Ksplice vs. another rebootless solution.
Win with a better product
The way to succeed is to make your product better, not to worry about your competitor’s product. The way you make your product better is by spending time with your customers, to better understand their needs and to make sure you’re solving them.
Any time you spend fretting about what other people are doing is time you’re not spending on things that will help you win.
The funny thing is: I still talk about kreplace with my cofounders, but not in the way that we did back in November 2008. These days, when I say “It’s a kreplace situation,” it’s shorthand for something that feels like an important competitive development, but is actually just noise that distracts us from making our own business stronger.