Startup Founders: STOP MAKING THESE MISTAKES

Summary

In this video, Ash Moria discusses the importance of identifying true competition for startups. Many founders either deny the existence of competition or misidentify it, which can be detrimental. He explains that innovation often addresses old solutions, not new problems, and emphasizes the need to position a product against existing alternatives. By understanding competition and framing product pitches correctly, founders can strengthen their positioning. The video highlights the risks of comparing features without understanding customer needs and offers insights on how to balance innovation with real-world problems.

Takeaways

• 😀 Many startup founders struggle to identify their true competition, either thinking they have none or mispositioning against the wrong competitors.
• 😀 Pretending that there is no competition can be detrimental because sophisticated customers will compare alternatives without the founder's influence.
• 😀 Stronger product positioning comes from acknowledging and comparing your product to existing competitors, not pretending they don't exist.
• 😀 The common mistake of over-communicating more or better features can be costly, increasing scope and diluting the value proposition.
• 😀 Founders often misidentify their true competition by focusing on direct competitors, but everyday tools like email or spreadsheets can be the actual competition.
• 😀 Communicating better features with a feature chart can be misleading if the differences don't matter to your customers.
• 😀 Your MVP should balance minimum scope with maximum value, focusing on what really grabs your customers' attention.
• 😀 The innovator’s bias occurs when founders focus on building a solution for a problem they’ve already decided to solve, ignoring other potential alternatives.
• 😀 The innovator’s gift encourages you to look at old solutions to uncover real, meaningful problems that your product can address.
• 😀 New solutions are often adopted not because they solve new problems but because they do a better job of addressing existing, painful problems.
• 😀 Instead of looking for competitors in the same category, think about your product's existing alternatives to help position your offering more effectively.

Q & A

Why do many startup founders struggle with identifying their true competition?

Startup founders often struggle because they either believe they have no competition or incorrectly position themselves against the wrong competitors. Both scenarios can be costly mistakes.

What is the problem with founders who believe they have no competition?

Founders who believe they have no competition may either convince themselves that their product is so innovative that no competition exists, or they may avoid acknowledging competitors to prevent steering potential customers toward them. However, ignoring competition can lead to missed opportunities and disadvantages when customers compare alternatives.

How does anchoring against competition strengthen a product's positioning?

Stronger positioning comes from acknowledging competition. By recognizing and anchoring against competitors, founders can better communicate their unique value proposition, rather than pretending the competition doesn't exist.

What are the common pitfalls when founders communicate that they are better than the competition?

Common pitfalls include trying to highlight too many features, which increases scope and development time, and comparing products to the wrong competitors. Many startups mistakenly position themselves against other startups with little traction, which can mislead them about their true competition.

Why should founders avoid focusing on more features when competing against others?

Focusing on more features increases the complexity of building an MVP, which takes more time and resources. Additionally, not all features are of equal value, and overloading customers with too many benefits can dilute the core value of the product.

How can founders identify their true competition?

Founders should look beyond other startups in the same space and consider existing alternatives, like email or spreadsheets, that customers might already be using. Even if these alternatives aren't listed in a feature matrix, they can be more significant competitors than startups with similar offerings.

What is the innovator's bias, and how does it affect founders?

The innovator's bias occurs when founders, driven by a new idea, assume that they must solve a problem with an innovative solution. This bias can lead them to either believe they have no competition or position their product as a better version of existing solutions, without fully understanding their true competition.

What is the innovator's gift, and how does it help founders?

The innovator's gift is the idea that new problems worth solving often come from old solutions. Instead of asking what problem a solution can address, founders should consider what is broken with existing alternatives and how their product can solve those problems more effectively.

Why is it important for founders to address existing alternatives instead of just focusing on competition?

Addressing existing alternatives helps founders understand and demonstrate how their product improves on solutions customers are already familiar with, transcending category boundaries and enhancing the product’s value.

How did Steve Jobs use the concept of existing alternatives to position the iPhone?

Steve Jobs acknowledged that existing smartphones were his true competition and used a product quadrant to demonstrate how traditional cell phones and smartphones were either not smart or not easy to use. He then introduced the iPhone as a simple, intuitive solution, effectively breaking the old way of doing things and positioning the iPhone as the new standard.