“Thanks for complimenting the quality of the guides. It’s funny, because we were just saying on the core team that the docs were in shambles.” — Stefan Penner; Ember.js SF Meetup; July 14, 2015.
Accurately measuring you own business or startup is hard enough. Judging what competitors and peers are doing is even more difficult. External perceptions rarely match the internal realities of a company.
As we wound down LayerVault earlier this year, there was a certain level of surprise from the Designer News community. To the outside world, LayerVault looked like a healthy startup: it had raised money, it had a vibrant “content marketing” arm in the form of Designer News, and sustained a seemingly high price point at $39/seat/month. Many other companies held us up as a golden standard.
Internally at LayerVault, we held other companies up as a golden standard. We envied some companies’ speed, others’ polish, and still others’ voice. It turns out, none of those companies were successful. Many suffered the same fate as LayerVault.
When running a company, it’s tempting to get wound up in the externalities of your market. Keeping a very close eye on competitors feels like the responsible thing to do. For most early stage companies, this is a waste of time. If your company does not have product-market fit (LayerVault did not), there is little to no use tracking competitors’ actions.
As an outsider, you don’t know if a competitor’s decisions were made with solid data or on a whim. If your competitor’s decisions were made with solid data, you assume that the data that drove their decisions also applies to your business. Furthermore, there’s a very good possibility that they don’t understand their business any more than you understand yours. By mimicking their actions, you are averaging an average. Copying a copy. Your effort will fail.
The only thing I’ve found to be effective at dealing with competitors in early stage companies is to ignore them. Establish your own metrics, set your own goals. Know what success looks like for your own company on your own terms. Understand what it will take to make your own business successful.
This is the Startup Theory of Relativity: Do not assume that companies with a good public face are doing well. Do not assume companies with a poor public presence are underperforming.
Focus on your own affairs, and keep moving.