Once in a while I find myself in a product or strategy or biz dev discussion at a startup which goes something like: “we are doing xyz to defend against ”. My reaction is to ask whether xyz is also part of what the startup was trying to build in the first place. If the answer is no, then I will argue strongly that they shouldn’t do it at all. Why? Startups have very limited resources. They succeed by putting all of those resources into a singular effort. That means being on the offense and building the product or service that they believe will succeed in the market. So it’s OK and sometimes even necessary to double down on offense based on a perceived or real threat by another player. For example, if you are web only right now but a mobile client is on your roadmap you may want to accelerate that. But it’s not a good idea to expend resources on something that you weren’t planning to do just to attempt to stall a potential competitor. For instance, spending time on a partnership with a large company to prevent them from working with someone else is a serious misallocation of resources. Same goes for developing features because someone else has them or is talking about having them if these features aren’t part of the vision for the product. Here is another way to think about this. As a startup you don’t really have anything to defend yet. You don’t have some large customer base or revenue flow that is supporting your cost structure and organization. That is exactly what gives you the freedom to pursue something disruptive. The second you start acting defensively you are throwing away that very freedom and acting more like an incumbent with all of the attendant problems.
