“Craiglist is dumb and unsafe, Ebay is complicated, takes too long to use, and shipping costs are too high, so we believe that our product is a better experience for people who want to buy and sell products online.”
Because of founder’s bias, most startups will believe that their idea is the best idea ever. After all, you saw a problem, a brilliant solution popped into your mind, and your friends said they too thought it was a brilliant idea. You may have even been offered some capital or were accepted into an accelerator to build out the business based on your vision.
While I don’t fault founders for being zealous about their idea, I do challenge them to not dismiss their competitors so quickly. So during the 1st week of our program at Seed Sumo we challenge them with a twist on their conventional company pitch:
“Pitch your competitor”
The rules are simple. Research 3 alternatives in the marketplace that your likely customer is currently choosing, pick one and pitch it as the best idea you’ve ever seen. Convince me that I should use that company alone and ignore everyone else. You have to be compelling, believable, and as passionate about their solution as you are about your own.
If you have an idea for an online marketplace, Is eBay really complicated? Does it really take too long to use? Is Craigslist really unsafe? If that was the entirety of the picture, then neither of these two solutions would be huge brands that almost everyone has experienced when buying and selling products online. The mistake that I see most startups make when comparing their business to an established brand is to focus only on shortcomings and miss the amazing value that a company like eBay offers.
Remind me that eBay has global brand recognition, millions of users, billions of transactions, that people trust their seller and buyer reviews for confidence, and that PayPal protects your money and your credit card number from strangers.
While you may have found a problem with an existing brand in the market, or a niche opportunity that is being underserved, successful companies did something right or they wouldn’t have been successful. Only by discovering their value will you understand what your future customer’s expect in terms of features, quality, and price.
If you can only see the negative, it hurts your credibility with investors, mentors, and others who would offer you advice. Challenge yourself and your team to dig deep and take the time to find the positive traits of respected companies.
And remember, while your idea is cool today, when you hit it big, one day in the not too distant future, another entrepreneur will call your idea dumb and use your brand as a source of inspiration for the next wave of innovation.