Compete Where Your Strengths Are

One of my favorite sites is Hacker News.  This is mostly because I discover many new blogs and interesting postings about a variety of nerd topics.  I was reading a post titled My Startup Manifesto, and loved one of the pieces of it.  The author was laying out his framework for how he wanted to compete in the marketplace.

One of my tenets has always been to go where the competition either isn’t intense, or is not flooded with talent.  This is one of the main reasons why I left the possibility of working in a hedge fund in 2005/6.  There’s just too many super smart people there trying to manufacture returns, and doing many of the same things.  My thesis was that it was bound to come to an end, and returns would revert to the mean, or even below.  We are now seeing that prove itself out.

This was also one of the reasons why I started IMSafer. The parental control space had seen no new investment for years.  Further, IQ tends to follow money, and no money had been made in parental controls.  We showed how you could build something new, addressing an existing problem in a new way, and have a successful exit.

The one paragraph that I wanted to grab from this manifesto was:

Compete Where Your Strengths Are

Figure out what your strengths are relative to your peers, and compete in that area. Too many people around the world can set up a LAMP stack and program in HTML/CSS/JS/PHP/Python/Ruby, so try to compete in an another area, where you have a competitive advantage. It’s okay to use the mentioned technologies, but if all it takes to duplicate your product is knowledge of easy-access technologies, you’re competing with millions of people, and your chances drop accordingly.

There’s a couple of pieces in that paragraph that are interesting.  I have read many postings recently saying that your best bet is to learn new languages all the time so that you can stand out ahead of your peers, as if knowing a new language is what matters in solving a problem efficiently.  The argument made is that if everyone else knows PHP, you can’t compete.  Code in PHP becomes a commodity.  Bullshit.  That’s like saying because I can write a sentence in English, Hemmingway had better watch out.

Language proficiency does not solve for algorithm design and code elegance.  There are going to be projects for which churning out commodity code is going to get the job done.  Let’s call that advertising copy editing.  A far larger percentage of the population can do that, and do it with sufficient skill to get paid to do it.  Writing the great American novel, on the other hand, is a far harder endeavor.

The core fault with much of the projects passing for “startups” these days is that there is nothing proprietary about them.  All too often we see these “me too” projects.  You all know them when you see them.  Somehow we have convinced ourselves that being late to the party and looking like everyone else is going to get us the girl.  Here’s a hint – she’s already left with someone who looked like you.

Compete where you are different.  A great example?  I love Balsamiq.  Love it!  Talk about finding an open space in the market and delivering high value product.  Peldi has nailed it, and I really want to see him have continued success.  He’s using the same list of tech that could be considered commodity, but he’s delivering a user experience that’s difficult to replicate, and, more importantly, he’s solving a problem no one else had solved in a way that made sense for the market he is in.

Many entrepreneurs I talk to these days have great ideas, but they are derivative.  Either that, or they are too easy to copy.  Twitter is dead simple, but they also have a huge lead.  Copying them won’t get it done.  There’s no shortage of discussions about FriendFeed versus Twitter, but the reality is that what those services ultimately deliver are different, which is why FriedFeed will continue to grow.  It’s not a Twitter clone – though much of FriendFeed’s traffic pulls from Twitter use.

Be different.  Be defendable.  Be determined.