Startup Pitch Competitions have tricked Founders into sharing all their secrets.

http://www.rudebaguette.com/2013/09/11/startup-pitch-competitions-founders/?utm_source=rss&utm_medium=rss&utm_campaign=startup-pitch-competitions-founders

by waxzce • 13 years ago

59 25 13 years ago

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r0h1n2• 13 years ago

I don't see it as a "trick" if a founder is willingly answering a question posed to him/her.

That said, I think this is reflective of the shift in software startups where the "secret sauce" isn't your idea or statistics, but the speed & method of your execution.

liam_boogar• 13 years ago

I disagree - are you a founder?

Think of the list of things you wouldn't want your competitors to know about you - your upcoming deals, your plans for growth - these are things that I've seen founders reveal on stage during a video-recorded pitch competition.

gjmulhol• 13 years ago

But then that founder is making the decision to reveal those details. A judge has a right to ask whatever he or she wants about the business. It is on the founder to be responsible in answering it.

To preemptively answer your question, yes, I am a founder. Yes, I have pitched at video-recorded pitch sessions (though admittedly not ones as high profile as Distrupt). I have even told a judge "we are not ready to share that detail publicly, but I would be happy to share at least some of that information with you after the event".

If you can't share at least some of the basics, then don't pitch at such an event. They are not a fit for everyone, and if you are a speed play -- relying only on first mover advantage-- then they are probably not for you. I personally feel strongly that most founders are too stealthy and too cagey. We should be able to share at least the core of what we are doing because it is a good way to get feedback. The risk is that someone will come in and out-execute you. If that happens, then it was probably going to happen anyway.

r0h1n2• 13 years ago

I'm not a founder, but am currently en route to being one (shortly, I hope) :)

Again, I didn't defend the right of the event/moderator/crowd to get a startup's data. But they have the right to ask for it, just like a founder has the right to refuse to give it up.

Startup events operate under an implicit or explicit give-and-take model. You get exposure in return for giving up insightful data about your startup. If you're not comfortable giving away data, by all means don't. But don't expect all other startups at such events to do the same. Let each one decide for themselves?

jasonlotito• 13 years ago

Having been a founder, what I'm willing to share or not is different than you. To suggest that you know better than me about my strategic and timely reveal is presumptuous. Yes, it's wise to know what you should share and not share, but then you also miss the point of the Q/A.

eli3• 13 years ago

Our plans for growth are (mostly) public. A smart competitor could have figured them out on their own anyway--it's to keep expanding on what we're already doing. Luckily for us we really don't have much direct competition. Not every market is the same.

fudged71• 13 years ago

I disagreed completely with the title, then completely agreed with the article. Thanks for sharing the link. I've been asked some very probing questions by journalists as well.

nemothekid• 13 years ago

I've heard this question so much, that I might as well ask - has anyone ever (in maybe the last 5 years) had their startup idea, copied then successfully executed by Google that led to the destruction of your startup?

I can only really think that once Reader was released it may have killed a couple startups but other than that I don't see the historical context for why this question gets asked so often. Google Drive didn't kill Dropbox, and AWS has yet to kill linode.

eli3• 13 years ago

Google Video famously failed to kill YouTube, and not for lack of trying!

loceng• 13 years ago

Facebook got started similarly, though that was a coder hired to work on a project and told details presumably in confidence.

jlees2• 13 years ago

I've definitely seen "feature" startups that didn't do so well once Google finally moved, but it's been more of an issue with startups built entirely within an ecosystem & taking advantage of missing platform features e.g. Twitter.

bdcravens• 13 years ago

I'd argue that startups that can be killed by something Google releases aren't businesses, they're products.

jkaljundi• 13 years ago

As a smallish angel investor, serial entrepreneur and startup event organizer, I see no problems neither in asking those questions nor answering them, often in quite much detail. Agree with r0h1n it is more about the execution.

True, there are some things none of us will disclose. Don't think someone realistically would expect you to disclose your upcoming deals. Like said, many are also fun probing questions and you should take them as such and turn them to your advantage.

We did have mixed feelings at my current startup, Weekdone team management and collaboration tool when we decided to publish our roadmap: https://blog.weekdone.com/weekdone-product-development-ppp-a... It might give great ideas to competitors or other upstarts. But the value of customers, both potential and existing, knowing this outweighs the secrecy. YMMV.

It's also a cultural thing. The blog is French. Europeans are much more secretive.

On one point in the article: I remember Jeff Clavier (also French, now in the Valley) telling at an event that when mentoring French and EU startups coming to the US, the slide he tells them to always out is the exit strategy slide :) Not for secrecy, but because it's silly to include in your startup's vision. Built a great business and product instead.

eli3• 13 years ago

I probably wouldn't answer some of those questions in public, but not because I think someone's going to steal my idea. They're just none of your business.

It's a big market and this is an execution game. If you think you can jump in late just because you heard I have 100,000 users, well, good luck to you.

benjamta• 13 years ago

Quite agree - it's all about execution.

Other people want to come and do what we're doing? Well that's just great, it validates our market. We just need to make sure we're doing it better than you.

morgante2• 13 years ago

Founders who protest such competitions are the same types who ask potential employee's to sign onerous NDAs.

Honestly, almost nothing about running a business should be secret. Because that's not where your success comes from. It's all in execution and building a great product/culture. You can openly share all your plans and still see others fail to copy them.

agilord• 13 years ago

I'd love to see your business plans, upcoming negotiation agendas and planned budgets. And I am not even your competitor, as I don't know what business you are in. Imagine your competitor's eagerness for such data.

morgante2• 13 years ago

And I'd have no objections to sharing such data. It's simply not the competitive advantage in most fields. Execution and effort drives success, not business plans.

austenallred• 13 years ago

If "how many users do you have?" or "What is your conversion rate from freemium to paid?" is a "secret" that would allow someone else to enter your space and beat your startup at what it does, you don't have much of a startup. You have many closer snakes to kill than worrying about competitors entering your space because they heard a stat at a startup competition.

simonw• 13 years ago

Stats like that are private not because they might encourage competitors to enter your space, but because they might give your existing competitors ammunition to use against you. Very obvious example: someone who is considering becoming your customer may chose a competitor if they know that the competitor has three times as many users as you.

Or maybe you're doing really well, but you want to save the fact that you have over a million users and use it up get a great press story at a strategic moment.

There are plenty of good reasons to keep your numbers private.

mbesto• 13 years ago

Lots of people talking here about execution, but what actually makes "execution", execution?

Let's say for example you are the founder of Vitamin Water and you say "Our secret sauce is that we will compensate celebrities to promote our brand by offering them equity in the company".

Great! But do you have the means to pull that off? How can you convince an investor that you have the ability to convince 50 Cent (or most likely his accountant) to take equity in your venture?

This is execution. It's immeasurable, subjective, and is the most important part of executing a startup. It's also extremely hard to articulate (convincingly, mind you) without actually seeing it happen right in your face.

I "give away" my strategy to Compete Hub (my startup) all of the time. It helps me validate my market. My competitors could easily analyze this and do the same thing. The reality is - they know more than me, but they simply don't have the execution capabilities to do so.

makerops• 13 years ago

"No one is teaching founders which information they should give out to strangers and which information they have a right to keep to themselves, and frankly, the judges are more at fault than the founders."

Being ignorant is the founders' fault, not the "judges". As a founder, if you want to become less ignorant, figure out what you should/should not be telling. Hide a Dagger behind a Smile is a good book on tactics; along with 48 laws of power, with the former being more applicable.

jlees2• 13 years ago

I like this point:

Judges in non-related sectors determine whether an early-stage gaming studio is ‘better’ than a boot-strapped big data startup.

It's certainly true that watching back to back pitches of very different companies, even in the same general sector, makes me wonder how on earth the judges are supposed to pick a 'winner'. However, it's pretty educational at the end of the day -- numbers matter, perhaps more so than the idea itself? -- any startup can be distilled down into a bunch of metrics and compared against another. It's that ephemeral 'potential' that makes the difference in terms of winning competitions, I think; I also wonder if a startup built purely to win a specific competition would look very different from one built because the founders had deep expertise and genuine passion for a specific problem or area?

nevi-me• 13 years ago

It can go in any direction. I've seen companies that I might potentially compete with in the near future disclose a lot of things that could give me/anyone an advantage. It's not that we have "100'000" active users or any of the metrics, but rather something very important: Their strengths. There is a company founded by a few guys who had an idea, and patented it. They were already in mid-management corporate positions, so they managed to secure some funding. The strength that they always put up on microphone was that they're relying on patent protection, and that they want to see the likes of Google license their technology. The problem with this is that if they were programmers they'd know that their software patent is invalid, and that it's nothing really out of this world. Instead of focusing on building a solid product they wave the patent around while some of us are finding ways of taking them on.

I disclose the technology that my app uses, but I don't feel comfortable telling the world how I've managed to do something that could take minutes achievable in seconds.

quizzas• 13 years ago

I look at pitch competitions as practice for public speaking so when I do have a one on one, I'm rock solid with my 30 and 90 second pitches.

Startup Pitch Competitions have tricked Founders into sharing all their secrets.

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