What to do when an $8 million gorilla launches 3 weeks before you

by szopa • 17 years ago

95 60 17 years ago

prakash2• 17 years ago

Firstly, don't characterize competition as a 8MM gorilla, when they are a startup.

Second, don't worry about competition. Focus on your users. Listen to them. Iterate rapidly. Add features request by your early users.

The other way to think about it is the facebook > twitter status update* as a product. Taking one component of a successful product and making it a product.

* comparisons to fb might not be completely accurate since one of the founders, apparently had the idea for twitter when folks were updating their IM clients.

apgwoz• 17 years ago

> comparisons to fb might not be completely accurate since one of the founders, apparently had the idea for twitter when folks were updating their IM clients.

I had the idea for twitter back in 1998, but I didn't do anything with it, neither did the founder of facebook... Ideas mean nothing without execution.

ErrantX2• 17 years ago

Firstly, don't characterize competition as a 8MM gorilla, when they are a startup.

Even when they raised $8M in funding?

http://www.dmwmedia.com/news/2009/09/15/clicker.com-launches...

I think the word startup is the one misplaced :)

prakash2• 17 years ago

Even when they raised $8M in funding?

Yes. $8MM doesn't mean they have customers/users.

edw519• 17 years ago

Funny thing about competition, if the market is big enough and the competitors are good enough, there's plenty of room.

At TC50 Clicker demonstrated a product that has about every bell and whistle you can imagine. SetJam is stripped down to the bare essentials. I’ll let our users tell us what they need instead of deciding for them.

How about that, he's already found a classic way to differentiate. Sounds like a great starting point. I have a feeling they'll do well.

davidw• 17 years ago

> ... if the market is big enough and the competitors are good enough, there's plenty of room.

... and if there are no big huge network externalities creating a winner-takes-all market.

Retric• 17 years ago

are no big huge network externalities creating a winner-takes-all market.

Facebook did not kill off other social networking sites and it's got far more externalities than most websites. Once the market is large enough you only need own a tiny slice to make a small profitable company.

minalecs2• 17 years ago

I can tell you that there are still a lot holes to be filled in, meaning there is a lot of potential for you to grasp market that they won't be able to. I don't think I can go into specifics, having been one of the original programmers on clicker.com, but going more towards the decision of allowing the users to decide, and not telling the users what they want, is a very good strategy. there is nothing wrong with changing directions based on what your users want.

dksf• 17 years ago

Love this quote from the article... I actually had to re-read it to make sure I got it right:

"If you’re an investor, I’m looking for a partner to help me make Clicker the Ask.com of online video guides. I think you’ll find SetJam is a real bargain!"

gizmo• 17 years ago

Good catch!

I don't think it's a nice quote because it's about Clicker losing. Doesn't sound like a convincing pitch. The whole "let's not read the article because I might not like what I see" attitude also doesn't inspire confidence.

His honesty and frankness is cool, though.

scott_s• 17 years ago

When you're forced to act as both infantry and general, sometimes you have to ignore your general duties for short periods of time so you can live long enough to the general again.

thaumaturgy• 17 years ago

Maybe sometimes you have to know when to focus on your product, and when to focus on your competitor's. What he said sounds pretty straightforward: they were busy, in a critical part of their business development, and he knew that looking at their knew competitor would just distract him from what his team was already doing.

He didn't ignore it altogether, he just waited for the right time.

sachinag• 17 years ago

That sentence cannot possibly be legal, right? I mean, you can answer the question "are you raising money?" with a "yes", but that sentence strikes me as sufficiently similar to a securities offering.

(I'd love to know I was wrong - I'd put a funny line at the end of every blog post I do for Dawdle.)

jack7890• 17 years ago

Securities offerings only need be regulated if they have over a certain number of investors (I believe 100). There's nothing wrong with asking people to invest in your company.

willwagner• 17 years ago

When looking at Ask.com compared to Google, Ask looks like a failure, but I wouldn't mind being the Ask.com of online video guides.

It's still one of the top 50 sites worldwide (according to Alexa at least), with a fraction of the employees of google and a pretty good demographic of users who click on ads. Its history may not be stellar but as a business, it's not a bad company.

Disclaimer: I used to work at Ask.com so I might not be all that objective.

electromagnetic• 17 years ago

> Disclaimer: I used to work at Ask.com so I might not be all that objective.

You're probably not, but IMO you're right. As long as you're making money, you're not a failure. When you owe money and have no hope of turning it around, that's when you're a real failure.

jacquesm3• 17 years ago

When spotlife.com launched the demise of Camarades.com/ww.com was widely announced, spotlife was backed by heavyweights Logitech and Philips ($30M).

Spotlife went under many years ago, ww.com is still ticking along. Don't say it can't be done. Be prepared to put in a lot of time and effort though. And forget about finding external capital for the moment.

cousin_it2• 17 years ago

It's good. How is ww.com doing now? I'm actually in a similar situation with openphotovr.org - the competing services from Google and Microsoft turned out to be not nearly so popular (or well-implemented) as I'd feared, and it almost makes sense for me to start pushing the site again.

jacquesm3• 17 years ago

Slowly dying, and has been doing so for the last 5 years or so. There is a lot of competition out there and we've shrunk little by little.

We're in talks with a company about some major move though, so maybe we can get it to be top of the line again without breaking the bank.

To be honest, in spite of making tons of money from it I really can't get excited over webcams any more, it's been enough. Time for fresh blood.

nitrogen2• 17 years ago

I like what you're doing with openphotovr.org. I've seen too many private research projects and not enough released software in the general arena of putting 2D images into a 3D scene. If you could add the ability to generate a polygon mesh (or at least voxels), that would be sweet...

launic• 17 years ago

When your competitor has raised $8M in funding and you barely have $50k you get the feeling that it is not a fair competition. (And it can not be fair, no matter what you say...). But when your product gets better reviews, you suddenly become more optimistic.;)

jyothi• 17 years ago

And being more optimistic is the scary part especially when you don't have enough money. I wouldn't care much about how much money the guerilla's have got.

Have been through both positive and negative end result on two different products.

On a ecommerce product discovery site ReviewGist.com - we had a technically superior product, reviewed on TC and host of other big tech/startup blogs. But sustenance, financial muscle to extend reach matters a lot. Other VC funded companies marched past us long ago.

On a facebook book reading community "Books iRead/weread.com" we were new, small and of course used no budget. We bet the biggies in the market like goodreads, shelfari, librarythings who were there for long time on internet and well funded.

When it is consumer oriented business there can be wonders. But it is definitely a big red alert to watch for the biggie constantly. You get lucky if they don't do things right.

meterplech• 17 years ago

also, clicker seems to be getting a lot more publicity. this is obvious considering they have more money, PR people, or whatever, but you should work on some basic attempts to get your name out there. why aren't you on crunchbase? googling "set jam" sends me to a website on proper handling of cherry jam. The way to win against the gorilla is to use your position as a PR move and write to dozens of blogs, forums, and newspapers (even those old things on the tree-based substances are still read, especially when content is placed online).

You are definitely facing unbalanced competition, the way to beat the bogeyman is to enhance your product's value proposition and use every opportunity for free PR

edit: I do understand the company is called "setjam" not "set jam" but, I imagine many others do not

drstarcat4• 17 years ago

Believe me, this is what really scares me. I feel like a lot of the startup game has turned into a popularity contest, and I've never won a popularity contest in my life. If you look at my twitter stats or blog traffic, you can see that I just write about geeky things that no one cares about. Promoting myself just doesn't come naturally.

My hope is that by listening to our users and focusing 100% on them, we can build a better product and that will be enough. In the end though, I'm the CEO and I've promised my team to get the word out so our efforts aren't in vain. I've set myself to tackling the PR problem with all the intensity I bring to our product. I hope it's enough.

patio11• 17 years ago

An $8 million gorilla only matters to the extent that you are a monkey.

You're not a monkey, so I don't know what you're doing defining yourself in reference to a gorilla. Probably not "a lot of good".

rythie• 17 years ago

If anything they could be over funded. I wouldn't call them a gorilla unless they were someone big like Yahoo, Google, Microsoft or have proved themselves in the market over 6+ months.

maxer• 17 years ago

out press them, watch this interview from mixergy with the founders of hotornot.com

http://mixergy.com/hotornot-bootstrapped5-million-profits-ja...

once hotornot bootstrapped from the guys front room- funded competitors sprung up everywhere. He talks about getting his site to be the first article that newspapers carried about such a site

teej• 17 years ago

I've been at a company that successfully pulled this strategy off. We effectively made the press think we were the leader in our space. This was incredibly helpful in raising capital, but it horribly failed at getting us closer to profitability.

holdenc• 17 years ago

No doubt clicker.com has a lot more people required to make a single decision. In the beginning, when there many critical decisions, this is a disadvantage.

Another thing setjam has going for it is time -- it can grow at its own pace, I suspect. Clicker.com is more sink or swim, and the clock is already running.

systems• 17 years ago

There can be only "Many"!

You don't have to be No.1 or the only one to be successful. If you are a player, I think this is good enough. And good luck!

oliveoil• 17 years ago

Isn't it unfair to say that they raised "$8 million on a PowerPoint like it’s 1999"? It definitely was harder otherwise SetJam could create something in PowerPoint too.

drstarcat4• 17 years ago

Yes. It is unfair. They raised the money based on Jim's experience as a CEO of a publicly traded company. Still, it's not really how the startup game has been played in quite a while.

tptacek2• 17 years ago

There's no such thing as "8 million dollar gorillas". Companies with 8 million dollars in funding are monkeys just like you.

The gorillas make more than 8MM in profit.

drstarcat4• 17 years ago

Agreed. I'll be posting next week on our launch day about our real competition. And they are gorillas--mean ones!

Shooter2• 17 years ago

I think of 'gorillas' as having revenues in the Billions or customers in the millions...

I guess everyone has a different concept of the boogeyman?

tptacek2• 17 years ago

I guess I'm just trying to say, you might change up your strategy competing against Cisco, Microsoft, Google, or even Salesforce.com. But an 8MM round from a competitor probably shouldn't alter anything about your plan, unless it's to capitalize on the attention their inevitable vanity launch will generate.

jhancock• 17 years ago

A gorilla is the company that controls the market. The market does not have to be in the billions.

This blog post does not reference a gorilla and its not even clear there is a developed market, so he is using the term incorrectly. His competitor is just a startup with more funding then he has.

alain94040• 17 years ago

The media loves a good fight. Otherwise they are bored to death just copying press releases.

So you have a good angle to play. At this point, I would shoot to get a free ride on the buzz they are going to get short term, and see them die from overweight within 2 years while you zoom past them.

jasonmcalacanis• 17 years ago

Very simple: go raise $8-12M based on Lanzone creating a market for a web-based TVGuide. Almost every market worth being in has two winners (think cola, search, fedex/ups, burgerking/MCdonalds, etc).

Also, on exit have two players in the market will help. they will probably not want to exit under $100M and you can carve out the quick exit at $25M.... or not.

the best thing to do is:

a) raise some capital ASAP b) focus on your product c) focus on users and what they think of your product d) focus on distribution (i.e. consider strategic money maybe).

best jason

drstarcat4• 17 years ago

Thanks Jason. That's pretty much the plan, though I'm focusing on "b" until Tuesday, "c" for the rest of my life at SetJam, and going to work overtime to make sure "a" happens in spite of putting it behind "b" and "c".

jazzdev• 17 years ago

Almost every market worth being in has two winners

Treacy and Wiersema in "The Discipline of Market Leaders" claim there are often three winners in every market. The price leader, the feature leader and the intimacy leader.

jbarciauskas• 17 years ago

Funny. I had started working on something similar as a way to learn Django. Was going to use Netflix as my master data source and dapper to scrape Hulu, XBox 360 (on xbox.com) and various lists of iTunes movies. This was going to be a project over a few weekends.

I'm not sure I see where the business model is. The value zap2it and the actual TV Guide bring to the table are by offering original content, something more like Entertainment Weekly. That doesn't seem to be in the plan for either company.

That leaves the affiliate model he mentions, and I can't imagine Netflix, Apple or Microsoft are offering an affiliate model. Hulu also seems doubtful, as an affiliate program for Hulu would be huge news. Perhaps Amazon? After that, it's all small potatoes.

Anyway, good luck.

lyime• 17 years ago

The business model is to position themselves as a media site. With organic growth and tons of good content pages, you can make really good CPMS. So if you have good traffic you can make good money.

kbrower• 17 years ago

Netflix definitely does have an affiliate program and pays ~$20 per new user

wmeredith• 17 years ago

iTunes also has an affiliate program.

misuba• 17 years ago

How much does a gorilla cost? Like, a real one?

Given that it's probably a gray market at best, I'd guess that one or two particularly impressive ones have traded for $8 million. To Kim Jong Il or somebody. Seems reasonable, right?

ApolloRising• 17 years ago

If you have 50k in the bank that is not small change for a startup. That is plenty for you to show off your skills and get things going. Just because they have 8 mil and can hire a ton of people, does not necessarily mean they will be able to execute at your speed. They may have countless discussions, meetings, changes, upgrades, etc... that keep them from releasing product. I've built stuff in a few days with a friend that some companies can't build in 2 months due to the endless meetings and other such nonsense.

Focus on your users and give them what they ask for and remember this: To an end user Yahoo and mydinkysite.com look the same, they have no idea if there are 13,000 people backing it or just you. 10,000 servers or a shared hosting account. All you need to do is give them what they want better than the competition.

You can buy/rent a lot of talent in the valley, but you can't buy is domain knowledge acquired by talking to your users! Engage them and they will give you ideas that are will give you an edge.

asdf333• 17 years ago

Here is another option for you. Look long and hard at your business and your partners. Decide if you want to compete w/ Ask.com (maybe you do) and also entertain the possibility of switching directions and doing something different.

Maybe some of the code is reusable? Is there a better idea? Ask yourself if you were to start today, what you would do.

We went through a similar situation and we changed direction. We were lucky to have a flexible and talented team, and looking back on it, it was the best decision we ever made.

joshu• 17 years ago

This is a bit inane, given the N billion dollar gorilla already in the room is the people that actually own/licence the content.

danhak• 17 years ago

I think the auther is unncessarily hung up on Clicker, which doesn't even seem to be out of private beta yet. His real competitor is SideReel, a television stream aggregator with huge penetration right now.

minalecs2• 17 years ago

i agree, sidereel is the best site out there for this, but the sad thing is the more popular it becomes, the less likely it will be good and have the best source and be able provide things that an 8m funded company can't. *hint hint.

What to do when an $8 million gorilla launches 3 weeks before you

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