The Next Web

David vs Goliath: the underhand tactics of competition

Written on May 24, 2008 – 3:30 pm
Steven Carrol, Next Web WebTipr France

The greatest threat to any successful startup is competition. The more successful you become, the more competition you will piss off, and each contender will bring with them a new strain of hassle.

I’m not talking simply about competitive products, no I’m actually referring to the many underhand tactics that will be employed by at least some of these so-called competition. So what are these threats and how to best deal with them?

The Murky World Of Business

The first port of call for underhand competitors will be to learn everything they can about you, looking for any weaknesses they can find. These typically involve ‘competitive intelligence’ techniques which is a fancy way of saying they employ private investigators who will even sniff through your garbage.

Competitive Intelligence

This typically takes many forms and practitioners are not afraid to stoop to low levels. Private investigators are generally extremely creative and efficient, not least cost effective, who have many contacts and techniques that they leverage to build a portrait around individuals within the company. They can get access (break in) to bank account details, tap phone lines, bug offices, cars, even homes, follow people, pose as reporters / employees (man on the inside) etc. to gain access to people and information that could be useful.

Utilization Of Competitive Intelligence

Depending upon the nature of the rewards, a campaign to ‘levy distress’ will be initiated with various arms but the same goal. The goal being to chop the legs off ‘metaphorically speaking of course’ the main targets.

Legal Assault

One of the most cherished methods is to create phony legal cases against the targets. They do not need to be serious, just a host of frivolous nonsense is sufficient. It is very cheap to send out threatening letters and tie targets up in court battles which can become exponentially destructive and costly to fend off. Typically they will be cases that are 99% twisted around so that the aggressors will be claiming the targets are actually distressing them.

Creating Havoc

Paying off disgruntled employees to cause hassle within the company, setting traps for the targets, reporting the targets (to officials and dependencies) for anything and everything they can. Disconnecting ties between targets and their networks (such as distributors, retailers, suppliers etc.) and any other psychological torture they can muster.

Intellectual Property Theft

There is nothing like learning from others mistakes, all services, products etc. will be reversed engineered to learn secrets from the targets, then the cream will be repackaged into similar offerings, where the ‘competition’ use the building blocks that have been successful along with their greater financial muster to encroach upon the targets market. Patents and copyright laws are of very little significance for young companies who have not the experience, nor resources to leverage the law to their favor. Further, the rogues will be carefully protected from legal assault themselves as they use ‘front’ (disposable) companies for their full on attacks.

David Vs Goliath

Typically the targets ‘upstarts’ that enjoyed early success will be naive to the murky world of ‘business’ where cannibals and dinosaurs await the fresh bloods arrival for their feasts. In order to survive, here are some practical tips:

• Remain focused on the ‘real problems’ within the business.
• Continue to innovate and move the market.
• Learn the tricks of Goliath’s trade, the more you know about him and his tactics the better.
• Be very careful who you trust, especially when it comes to these ‘pillars of society’.
• Learn how to bat!

Batting

If you do find yourself in the middle of a ‘war of terror’ then the quicker you learn how to fight, obviously the better. Understand that the world of business is much like nature, it is not personal and brutal. Speed, intelligence, posture, bravery and trickery are the necessary assets to be packed in your survival kits.

Good luck out there! You will need it…

I hope you like that post!

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competition, luck, markets, success, trust

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Once You’re Lucky, Twice Your Bloody Lucky!

Written on May 14, 2008 – 11:07 am
Steven Carrol, Next Web WebTipr France

I have thought long and hard about luck and following all this hype around the concept Sarah Lacy is promoting ‘Once Your Lucky, Twice You’re Good’. Well, I disagree with her assertion!

Back in my ‘naive days’ I would have argued vigorously that one doesn’t need luck at all, instead innovation, logic, elegance, brutal hard work and a twist of magic were the ingredients essential for success. This would have been while I was building my first empire. During that experience I didn’t get very rich (financially) but I did learn more about life / business / creation / ideas / people / magic and luck than I could have ever imagined. My little baby organically grew from a 20K overdraft to a turnover of 2 million GBP annually (6 years after launch) and garnered a cult following.

Its been a long time now since riding those early waves and I have had long enough to analyze the experience and realize the arrogance of belittling lady luck. She sure as hell taught me a few hard lessons as a result. Needless to say I have rather more respect for her charm now and in an effort to make peace I am dedicating this article to her.

One of my favorite online destinations is Hacker News, a forum where hackers / startups discuss the issues of the day. A theme that has been popping up there recently is controversy over the value of ideas, with many arguing that ideas are worthless and execution is everything. Again I totally disagree. Ideas and luck are two of the most rare but essential and non quantitative elements necessary for success, followed sometime later by the usual host of other elements that ultimately determine the fate of such a journey.

To illustrate my points, first I need narrow down the criteria of what is considered to be ‘a win’. With Internet startups I’m going to classify ‘a win’ as ultimately financial success, followed secondly by user participation and adoption. Yet I want to strongly stress these are not my personal criteria as to what constitutes as ‘a win’, but only what appears to be the de-facto standard by which many are currently judging.

Given that financial success is the ultimate milestone I will use the Google as the standard by which I make my case. Google is without doubt the current online financial super star, they are making more money than anyone else and they have available to them every single advantage that money can buy. And while they have leveraged their resources in every way imaginable, they essentially still only have Adwords / Adsense as their core cash cow, while every other arm is either loosing money or financially insignificant. Why is this? Luck!

You cannot make a compelling argument that they are not good, why that is their company manifestation after all. No it is not because Google are bad, but good luck is like lightening, it rarely strikes in the same place twice and if it does you will be bloody lucky, evidently so.

Coupled with the power of ideas, really good ideas share the same traits as luck, in as much as they are just as rare but ultimately make all the difference in the direction you choose, where you will then need lady luck to give you the kiss of life in order to achieve ’success’.

adwords, google, hacker news, Inspiration, luck, sarah lacy

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