* The Business of Software

A former community discussing the business of software, from the smallest shareware operation to Microsoft. A part of Joel on Software.

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Moderators:

Andy Brice
Successful Software

Doug Nebeker ("Doug")

Jonathan Matthews
Creator of DeepTrawl, CloudTrawl, and LeapDoc

Nicholas Hebb
BreezeTree Software

Bob Walsh
host, Startup Success Podcast author of The Web Startup Success Guide and Micro-ISV: From Vision To Reality

Patrick McKenzie
Bingo Card Creator

The Fear of Competition

On a regular basis, posters to this forum won't reveal their product or idea, for fear of competitors springing up and stealing their thunder. To me, this is plain silly.

You can't run a business without telling everyone what your product does. You've got to shout it, day in and day out, to everyone who will listen (and a lot of the time, to those that don't want to listen).

Anyone who asks "Why isn't my product selling" and then says "I won't tell you about my product" probably doesn't have the wherewithal to run a business. You've got to tell EVERYONE about your product - that's the whole point!

Competition is good. It validates the market. It signals to customers that there is a market. Rather than thinking "Why do I need X?" the customer starts thinking "Should I choose X or Y?".

Competition provides a foundation for differentiation. People will buy your product because it has something your competitor doesn't have. That is so much easier to sell than a new idea into a non-existent market. It makes your job easier in designing what your product must do.

Lastly, most fear of competition is unfounded. Markets with lots of competition are easy to break into. I actively seek them out.

Most people won't copy your product. If you're good at business/marketing, you'll beat "better" products with your better marketing.

So,do not fear revealing what your product does in case of competition. It doesn't make business sense whatsoever.

Anyone want to add their thoughts?
Cyclops Send private email
Thursday, August 07, 2008
 
 
How do you know that people aren't coming on as two different identities, one blowing their own horn, one whining about low sales?
Stereoscopic
Thursday, August 07, 2008
 
 
I think to an extent it depends on the field, the market, the product or service, and the business owner, but in general, I agree. Don't fear competition -- compete.
Andrew Badera Send private email
Thursday, August 07, 2008
 
 
Derek Sivers, 2005:

It’s so funny when I hear people being so protective of ideas. (People who want me to sign an NDA to tell me the simplest idea.)

To me, ideas are worth nothing unless executed. They are just a multiplier. Execution is worth millions.

Explanation:

AWFUL IDEA = -1
WEAK IDEA = 1
SO-SO IDEA = 5
GOOD IDEA = 10
GREAT IDEA = 15
BRILLIANT IDEA = 20

NO EXECUTION = $1
WEAK EXECUTION = $1000
SO-SO- EXECUTION = $10,000
GOOD EXECUTION = $100,000
GREAT EXECUTION = $1,000,000
BRILLIANT EXECUTION = $10,000,000

To make a business, you need to multiply the two.
The most brilliant idea, with no execution, is worth $20.
The most brilliant idea takes great execution to be worth $20,000,000.

That’s why I don’t want to hear people’s ideas.
I’m not interested until I see their execution.

http://www.oreillynet.com/onlamp/blog/2005/08/ideas_are_just_a_multiplier_of.html
MT Heart
Thursday, August 07, 2008
 
 
I agree. I have got at least 5 direct competitors and more than 60 with overlapping functionality - at the last count. I just make sure my product, marketing and customer service is better than theirs. ;0)
Andy Brice Send private email
Thursday, August 07, 2008
 
 
Could these be the (in)famous "idea men" we hear about so often -- big on ideas, poor on execution?

If it's your idea and you're anywhere near worth your salt, you should be able to develop circles around any clone that comes along. Clones hurt "mature" products (i.e. that aren't being improved any more).
(User deleted) Send private email
Thursday, August 07, 2008
 
 
Dear MT Haert,
Dear sir,

As per your order I have dreamt up a few weak and one so-so idea. I will do a few weak implementations of them later today. Can we meet tomorrow to conclude the sales?


regards,

Vee

P.S. I the pipeline for next week I have one good execution of a weak idea.
Vee
Thursday, August 07, 2008
 
 
I love the "just a multiplier".

For next year I don't want a salary raise, just a multiplier. A so-so one would do.

But yes, I get the point :)
Daniel_DL Send private email
Thursday, August 07, 2008
 
 
You do of course need to shout about your product from the hills, but it's kind of pointless doing so about your small/niche software product in a forum full of people looking for small/niche software products to implement for themselves.  This is unless you are hoping for specific advice which outweighs the perceived risk.
Benj
Thursday, August 07, 2008
 
 
I think people post anonymously here are more worried about a customer finding their post then a competitor.  Would you buy from a company that was complaining about low sales or getting lambasted by other developers?
Phil Send private email
Thursday, August 07, 2008
 
 
+1 Benj and Phil

Cyclops, you haven't thought your argument through.
Not a discussion
Thursday, August 07, 2008
 
 
OP, I agree that you should not refuse telling people what you sell out of competition fear. However there are sometimes other reasons to stay anonymous.
TN
Thursday, August 07, 2008
 
 
I have a public face on this forum and a private face.

The public face announces the website, shows off the products, etc.  I'd be OK with customers finding those posts (they all find me via Google, so they likely find those posts).

My private face on this forum talks about my weaknesses (single guy working out of basement, sales numbers, doubts, etc).  Those are absolutely not things that I want to trumpet to my customers.  And I don't necessarily want more competition either.  Sure, execution _IS_ everything, but there are SMART folks here that could probably execute better than me!  I don't want to invite them to the party!
anon :)
Thursday, August 07, 2008
 
 
The problem is that there are some *very* competent people that lurk these forums that can execute on an idea.
Pedro Estrada Send private email
Thursday, August 07, 2008
 
 
>> but there are SMART folks here that could probably execute better than me!  I don't want to invite them to the party!

So you think there are people here who will give you legitimate, well-reasoned help to a broad anon question, but these are the same people who will turn around and steal your idea and out-execute you? There's a logic flaw in there...

I agree with the part of the theme of the OP - people who ask generic questions and don't provide any information are not going to get anything of value and will just get the stock "it depends" answer.

And I don't think you need to expose all of your short comings to get help; if you're problem is gaining sales or exposure, why do I care if you're a one-man show? But I probably should look at your web site, your copy & pitch, how you rank in the search engines.

It seems that the general strategy of those in favor of anon is "develop as an unknown; unveil as the best of breed" or "unknown by the competition; first choice of the customer". That's a pretty challenging marketing proposition...
Mr. Blah
Thursday, August 07, 2008
 
 
"+1 Benj and Phil
Cyclops, you haven't thought your argument through."

But I have.

I was specific in that I was talking about fear of competition - not fear of revealing your business's current failure to market effectively to all and sundry. That is just as silly.

Benj points out that some people don't want to reveal their niche product in a forum full of people looking for niche product ideas for fear of their idea being ripped off. But why?

- If the idea is a great idea well executed then the idea-less just wouldn't be able to compete.
- If the idea is a great idea well executed then people in this forum would probably already know about it from other sources.

So, I can understand Benj's point but he doesn't qualify it - it makes no sense.

Never have I seen on this forum an idea that is so "killer" that anyone with a compiler and "30-days" can build a business out of it. And, I guarantee you never will.

And Phil's point is a valid one - but it is not about fear of competition, which is what I was talking about. It is fine to operate stealthily for a variety of reasons, but my opinion is "to keep the competition" at bay is not one of them.

I am happy to entertain alternative and opposite views. But my view is that any business that operates in a clandestine manner is going to find building a legitimate business very difficult indeed.
Cyclops Send private email
Thursday, August 07, 2008
 
 
> So you think there are people here who will give you legitimate, well-reasoned help to a broad anon question, but these are the same people who will turn around and steal your idea and out-execute you? There's a logic flaw in there...

This has happened here before. I've seen a Bingo Card Creator clone made by a supposedly well respected member of this forum. (no, it wasn't n!labs/Bruno)

> - If the idea is a great idea well executed then the idea-less just wouldn't be able to compete.

Why not? Maybe somebody is idea-less, but is very good at executing. Once you give him the idea...

I agree with the sentiment that people who ask for specific advice but don't reveal the product are wasting everyone's time. But for others there are plenty of reasons to stay under the radar.
Oliver Send private email
Thursday, August 07, 2008
 
 
It makes some sort of sense to keep your trap shut if successful and wanting to avoid giving too much info to potential competitors.

The truly crazy threads are when folks post that they have made zero or virtually zero sales, and they're still scared of encouraging competitors.

Thursday, August 07, 2008
 
 
Once again, everyone dances around the main issue. Someone who is not showing any "leg" here clearly doesn't believe that disclosing their idea in the open will benefit them. If they did believe that it would be a win, they would do so.

I know for a fact that some mISVs are reluctant to disclose their product concepts here because they don't feel like being eaten alive in the typical groupthink driven geek ego-fest that will occur.

IE: "Your idea is trivial!" "You've been here before, why don't you get a job" "You ripped off XYZ so you are a f*cking hack" "You are ripping people off with a product like that."

Input like that - especially from Asperger's types who are fixated on their own mental notion of "good" - doesn't really help.

Anonymous online forums can be mean places. This place has certain standard hostile responses to types of discussions.

Granted, this board doesn't owe anything - not even civility - to posters. It's supposed to be a crucible where you're torn apart and you're supposed to accept it as "coaching".

In like manner, posters don't owe anything whatsoever to the board. And the "community" everyone talks about so lovingly always contains random snipers reader to tear down anyone else.
Bored Bystander Send private email
Thursday, August 07, 2008
 
 
No it doesn't Bored, you're an idiot!
Ken Sharpe Send private email
Thursday, August 07, 2008
 
 
(Just kidding, for those of you with malfunctioning sarcasmometers)
Ken Sharpe Send private email
Thursday, August 07, 2008
 
 
And there you go... ;)
Bored Bystander Send private email
Thursday, August 07, 2008
 
 
"Never have I seen on this forum an idea that is so "killer" that anyone with a compiler and "30-days" can build a business out of it. And, I guarantee you never will."

Precisely. Because nobody in their right mind would announce it here.

You've defeated your own argument.
One in the eye
Thursday, August 07, 2008
 
 
>> but there are SMART folks here that could probably
>>execute better than me!  I don't want to invite them to
>>the party!
>
>So you think there are people here who will give you
>legitimate, well-reasoned help to a broad anon question,
>but these are the same people who will turn around and
>steal your idea and out-execute you? There's a logic flaw
>in there...

Not really.  Some people will give help.  Others might copy/beat me.  They're not necessarily the same people.

Listen, if I had a profitable niche making $1 million per year as a one-man show (I'm hoping to hit that number in a year or two -- almost half way there), wouldn't everyone here want to hear about it? 
Wouldn't many of them want to try and duplicate it?
Wouldn't some of them be able to actually do better than me (which would harm my prospects)?

If the market was unlimited, sure, no problem.  But it's not -- that's why it's called a niche.

There are many very profitable niches out there.  Some are even out in the open, but most assume it can't be done by a uISV.  I'd prefer to keep it that way (well, at least until I retire).
anon
Thursday, August 07, 2008
 
 
Again, why does any poster here owe the "community" a detailed explanation of their product idea or niche? Exactly where does this attitude of obligation come from? Is this the Kiwanis or Rotary Club of mISVs?

"The fear of competition" argument is a pseudo-challenge like "ha ha, I bet you won't stick your hand into this car's fan like a real man would."

Anyway, I think it's a good exercise for any entrepreneur to abstract their concerns and state them in a way that isn't tied to a particular business concept. "Marketing for an image processing program" is a lot less interesting than "marketing for an unknown-as-yet niche product."
Bored Bystander Send private email
Thursday, August 07, 2008
 
 
Anon, if you're making half a million dollars a year as a one-man-band small company I certainly want to know your idea...

There have been several ripoffs of BingoCardCreator right?  I doubt they'd all exist if Patrick wasn't such a well known character in this community.  I'm sure he has no problem handling it, but then *he* is very good at executing.  But talents are not distributed equally...

In my opinion, a good idea and a hungry market count for a hell of a lot.  Sometimes a great idea and a great market is enough to allow a crappy bit of software to become a success (bad execution on a great idea).

If someone's in the lucky position of having a mediocre software product that's selling on the strength of the idea and the hunger of the market, what's in it for them to tell a bunch of software developers about it?  Unless the readers here are the target market, I'd guess that there's probably very little to gain, but a lot to lose.
MB Send private email
Thursday, August 07, 2008
 
 
@Bored Bystander: "Again, why does any poster here owe the "community" a detailed explanation of their product idea or niche? "

They don't owe it, but if they come asking for help on improving their product then you need to be able to see their product. If you're that secretive than you're not going to get anywhere.

If you're successful then it's generally because you have a good idea and are talented enough to execute it well. Someone has to have both of these in order to compete, a clone will always be a clone and always be several steps behind your product because they can't think for themselves. There's more than enough room for all those who are talented enough, everyone else will filter to the bottom of the pool.
Martin Pilkington Send private email
Thursday, August 07, 2008
 
 
Bored Bystander:
"Again, why does any poster here owe the "community" a detailed explanation of their product idea or niche? Exactly where does this attitude of obligation come from? Is this the Kiwanis or Rotary Club of mISVs?"

Some of my scattered opinions...

Of course, nobody owes anyone here anything. But, as humans, we tend to have an innate sense of reciprocity. I'm more likely to help people who have helped me in the past. I'm no genius, and sometimes I seek feedback from the people here. The implicit admission price is that I also help those people out when they ask for it. Most of the time, it works out pretty well.

I also don't agree with the people who say that the idea is nothing and execution is everything. I think there are certainly cases where people will search through the archives here, looking for product ideas. I've done it myself, though I'm usually looking for general-purpose "inspiration" rather than for someone else's product that I can duplicate.

My only objection is when people post questions here, asking for very specific advice, but won't post the necessary details for anyone to give worthwhile advice. Not only do those people violate the unstated reciprocity principle, but they're cluttering up the forums with crap that will never be useful to anyone.
BenjiSmith Send private email
Thursday, August 07, 2008
 
 
To rephrase more concisely...

There's nothing wrong with fear of competition. In many circumstances, it's totally justified. Just don't expect to get any useful help or input if your fear of competition prevents you from disclosing any of the vital details of your project.
BenjiSmith Send private email
Thursday, August 07, 2008
 
 
"Anyway, I think it's a good exercise for any entrepreneur to abstract their concerns and state them in a way that isn't tied to a particular business concept"

I agree. Wholeheartedly. But the problem is that the people we're complaining about here don't do this. They ask questions so generic that they're hard to answer properly because there is little or no context, so they get generic answers to a generic question.

There are many reasons for not disclosing what your product is on this forum. Mine is that it's very likely that my main customer or his employees are reading it and I want to control their perception of me. That means that if I ask for help, I have to take the time to phrase my question so I'm likely to get *useful* responses.
farmboy Send private email
Thursday, August 07, 2008
 
 
So the "problem" comes down to wasting the time of users of these forums? I can agree with that, I suppose. But a vacuous and vague enough question will be skipped by more knowledgeable readers, and the responses will be anywhere from smartassed to brushoff, so IMO this is a self correcting situation.

I think that if some of you guys want a better rate of "information sharing", then this kind of forum (registraton-optional and with no ability to edit or other wise own your own words) is the wrong place to expect such openness. Only someone very naive is going to publicly record their problems here in an identifiable way. Using JoS for sensitive concerns is kind of like spray painting your social security number in a subway tunnel.
Bored Bystander Send private email
Thursday, August 07, 2008
 
 
It all depends on how paranoid you are and how anal your customers are. If you're incredibly paranoid or your customers are incredibly anal then you're unlikely to blog, or use twitter or talk about your software online in a way that can be linked to you.

If you're not paranoid and don't have anal customers then you'll have no problem being public about stuff. To me you're selling as much yourself as you are your product. You want to make customers feel that you're open and easily accessible if they need a problem. I don't care if people know that I'm only 20, still in university and not yet making a living off my software, because they'll also find out that I'm committed to my software and keen to make my customers happy.
Martin Pilkington Send private email
Friday, August 08, 2008
 
 
This forum has lurkers that copy an idea as soon as they see it. I agree that they probably won't be successful, and definitely won't be competitors (the English on their websites usually sees to that) but after the first time it happened on BOS I figured why feed their fire.
they might be watching the olympics
Monday, August 11, 2008
 
 

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