How schooner-sized startups can beat aircraft-carrier-sized companies

All startups start with nothing. No product. No customers. No growth. Nothing.

The incumbents have it all. A fully functioning product. Millions in revenue. Distribution channels that are working.

It must really suck to be a startup then, right?

But the counterintuitive answer is no – it’s actually you’re biggest asset to start completely from nothing with a blank slate.

Here’s why…

Large companies are like aircraft carriers

Aircraft carriers are the most formidable ships on the planet. Within a few hours they enable a country to launch an assault on another nation with air support. The United States operates 10 active aircraft carriers around the world. They are the cornerstone of the Navy.

Large companies are like aircraft carriers. If a large company gets its sights on you because your too close to their market, they have the power to destroy you. This comes through in the classic VC question, “what if Google does this?”

The reason why a large company got so large is that is kept improving its ship over time by growing, and the only way to grow that large is though process. Process keeps the hundreds of people all working together from falling into chaos. If you didn’t have process, you couldn’t move the ship because the ship is too large for one person to see the entire vessel at a glance. So you have to trust the process that you’re doing your job, and your crew mate is also doing her job, and since every one else is executing too, all parts of the ship can work in tandem to plow forward. Occasionally an air squadron can be sent out to wipe out a threat in range, but the planes always have to fly back to the ship.

Moving an aircraft carrier takes a long time. To change coarse many things need to happen at once. First, the captain has to decide where to go. Next, she needs to loop in all the right people so they can disseminate the news to the rest of the crew. Last, the direction is changed, but you have to wait awhile because aircraft carriers are so large that change in direction happens over a long time. Since aircraft carrier has engines eventually it’ll get there, but it can’t change coarse quickly.

Startups are like schooners

A schooner is a small sailboat with two masts. They range in size by can typically be sailed by between 2 – 10 people.

Before the age of the small onboard motor, schooners were strictly sailing vessels. The didn’t have motors. They were powered by the wind. Startups are also powered by the winds of market demand. You don’t decide where you want to go, the market decides for you. Your job as the captain is to realize when the winds change and sail with them as hard as you can. And since you’re in a small boat, feeling the feedback of the wind on your face, you can change direction quickly.

The great thing about schooners is that they are small. You can yell to your crew mates when something goes wrong for help. You don’t need fancy communication systems, you just see the issue and yell with your voice. You don’t have many fancy systems so you usually fix bug issues by hacking something together using common sense. When something goes wrong, you don’t need to respect chain of command and work your way up to the captain. You just yell for your captain who comes over and talks to you, a decision is made and you change direction. 

Enough with the boats! Why does this matter?

The reason why this matter is because lack of customers, processes and people is your biggest strength. When you’re starting with nothing, no one expects much of you. Your customers don’t care if you have a small or big free product. If you’re doing it right, you should be solving something so painful that whatever you give them is a step up from what they had before. And since you don’t have millions of users or revenue depend rant on your systems, you don’t have to worry about breaking the infrastructure or the businesses processes when you launch sown thing new. You can scale it as you grow.

I had to relearn this lesson the last few weeks while working on Leadin. We recently rebuilt the entire backend for the product on the cloud. The plan was to clone all the features over on a more reliable stack than WordPress and launch nothing new. This meant we had to clone not only our core app, but also all our onboarding, integrations and figure out a way to migrate our existing thousands of users.

Eventually though I realized we should operate like the early days. In the early days we didn’t have onboarding and people still used the product. We didn’t have 5 email integrations, we only had one with MailChimp, and people still used the product.

And if you think about it, people don’t know what they don’t know. New users checking out LeadIn for the first time don’t know there should have been onboarding there. They don’t know that in the old version they could integrate with a few more email services, which they most likely aren’t even using in the first place.

Once our team figure this out, we were able to start stripping out the none essentials even more and ship the new version of Leadin weeks earlier than we planned. Launching that version felt great and reinvigorated us to finish cloning the last of the features because the product was in the wild now. 

Even with only a couple thousand users we feel into the optimization trap. Cut features that aren’t crucial. Ship the product before you’re ready to figure out if you should even scale it in the first place. Always avoid operating like a battleship and sail your startup like a schooner.

Startups are a Grind

Here are some of the things people think founding a startups brings you:

  • Launch parties
  • Funding announcements
  • Speaking at conferences
  • Choosing your own schedule
  • Being your own boss
  • Successful exits
  • Stacks and stacks and stacks of cash.

Here’s a slightly different and more realistic list of what founding a startup adds to your life:

  • Writing code
  • Fixing bugs
  • Answering customer support tickets
  • Paperwork
  • Bookkeeping
  • Emails
  • Taking out the trash – literally

The reality is that startups are a grind and take daily progress day in and day out. There’s a reason why there isn’t a popular reality show based on starting a tech company. Every episode would be almost identical – 30 minutes of watching people typing away on keyboards with headphones on.

When you see a company in TechCrunch or the New York Times, you’re reading about one moment in time which is often deliberately delivered in an exciting narrative, but not really indicative of what that team is working on day in and day out.

From what I can tell, the most successful startups just keep their heads down and headphones on, making progress little by little every day to build something their customers love and grow that use base. Focus on making progress and the rest of those exciting milestones will fall into place.

Startup Competition Means You’re Probably Heading in the Right Direction

I loved video games as a kid, and yesterday I stumbled across a meme that made me chuckle:

if i've learned anything from video games, it is that when you meet enemies it means that you're going in the right direction

I think this meme also holds true for startups, so I readjusted it:

If I’ve learnt anything from startups, it is that when you meet your enemies, it means that you’re going in the right direction.

So often competition bogs us down, keeping us awake late at night and causing our blood pressure to spike. I still remember the day I found the first competitive startup to Rentabilities. Then another rental marketplace cropped up a few months later, then three more the next year. Each time I encountered a new enemy, my inner-competitor wanted to goomba stomp each one into oblivion.

goomba stomp
How to Goomba Stomp

As the years went on, I realized our fiercest competition was not another startup and that competition in the market is a good thing. Startup founders tend to be some of the most intelligent, competitive and driven people. If other smart founders are investing their time into a similar idea as your startup, it probably means there is something interesting about the market and it’s worth pursuing. If one of those startups raises funding, that is even better for you because it validates the market even more, giving you fodder for your own investor meetings. Your company is more likely to die by self inflicted wounds than by the sword of another startup.

Stop worrying about the competition and focus on your product, your customers and yourself.

And if you need some motivation, remember what Alexis Ohanian says:

Lives Remaining 0

Make it count.

Big Startups Have Small Beginnings

tree and sapling

What do Facebook, Twitter, DropBox, Groupon, Airbnb and every other company in the world have in common?

They all started as ideas with no customers, no revenue, and no product.

Yesterday I met with a friend to talk startups over a coffee. He’s currently employed at a great company, and is thinking of taking the leap and starting his own startup. For about an hour we ran through his initial list of product ideas, discussing the opportunities and potential pitfalls of each one, eventually zoning in on a specific idea around the college market. Now that we had pinpointed one of the ideas, I finally asked, “When are you going to start?”. He paused. And winced. I could see he was torn, but after a moment he finally answered, “Not yet… I feel like I need to go all-in to really do this idea justice, but I have to admit I’m scared to take such a huge risk and leave my job.”

His response got me thinking about a myth that exists in the startup community. The myth that you’re not making real progress until you’re working full-time on your startup. I started questioning this line of reasoning, and decided to recap my thoughts in this post.

Start Small To See If You Should Start at All

“A complex system that works is invariably found to have evolved from a simple system that worked.” – John Gall

Did you know the founders of Airbnb started by renting out their own apartment, initially hosting three guests on air mattresses for a design conference in San Francisco? They didn’t start with a huge, grand plan to disrupt the hotel industry. Instead, the plan was to figure out how they could pay their rent for the month, so they hacked together a static web page showcasing their “bed and breakfast”, posted it online, and made $1,000 their first week by hosting three guests. That’s it.

One of the mistakes I see new startup founders make is believing that the only way to start a business or new product is to go all-in. Building something new requires configuring many complex parts, and it’s easy to get discouraged by the sheer amount of work it’ll take to start, especially if you’re working full-time. Most people never even get started, instead choosing to wait until the time is perfect. But that’s the thing with startups and life and the everchanging responsibilities we all have that eat up any free hours we might get to work on a fun new product. The perfect time just never comes.

To finish up my story from earlier, I ended up convincing my friend he should not leave his job yet, and instead start by talking to a few undergrads, maybe even test his idea by offering to mentor a handful of students personally and teach them how to gain work-related experience while still in college. It’s not a glamorous way to start, but by doing things that don’t scale, he’ll learn faster than by building out an entire product based solely on assumptions. From those simple learnings he can start to layer on complexity, eventually evolving a more scalable solution if the initial idea proves to be worth pursuing. Airbnb morphed from three guys renting out blow up mattresses into a multi-billion dollar business through the same evolutionary process.

As humans, I think we all possess an internal desire to build and achieve great things. I’m constantly reminding myself to counterbalance that drive with the realization that all big successes stem from tiny beginnings, and it’s ok to start almost laughably small.

What are some samples of projects that started small for you and eventually grew into a success? What are some other methods you use to get going on a new project? I’d love to hear your thoughts below.

Thanks to Alex Cook, Nelson Joyce, Josh Porter, Rachel Roizen and Derek Sivers for reading drafts of this.

Photo by the talented varintsai

The Real Truth About Startup Geniuses

Starting my first company was an eye opening experience because it made me realize I had absolutely no idea what I was doing. New challenges seemed to pop up every day and I stumbled my way through each and every one.

The best resources I found to help with my incompetence were books and blogs, but reading advice from successful founders often made me feel more inept. Those startup geniuses must possess a superior intelligence because of their successes. They must be more innately capable of building a company because they all seemed to know exactly what to do in every situation.

The funny thing is, as I eventually met and became friends with a few of those bloggers over the years, I realized everyone is figuring it out as they go. Behind every great success story are mistakes and hard-earned lessons. We just often don’t hear about them.

I try to remind myself now that everyone starts from nothing and it’s ok to suck at the beginning. No one knows how to solve a situation when it’s first encountered. Even impressive entrepreneurs like Drew Houston have knowledge gaps to fill:

“I was living in Boston, working for a startup during the summer, living in my fraternity house. But every weekend, I would take this folding chair up to the roof with all these books I got on Amazon. I would just sit there and read all of them. I would spend the whole weekend just reading, reading, reading. I’d be like, alright, I don’t know anything about sales. So I would search for sales on Amazon, get the three top-rated books and just go at it. I did that for marketing, finance, product, engineering. If there was one thing that was really important for me, that was it.”- Drew Houston

So don’t be afraid to try something new because of fear you might suck at first.

Don’t be afraid to start a company because you lack experience.

If you’re smart, pay attention to details, trust your best judgement, and persevere, you’ll quickly figure it out too.

Or as my favorite cartoon dog once said…

Sucking at something is the first step to becoming sort of good at something

The Founders Guide to Surviving Startup Life

founders survival guide

I used to feel a sense of accomplishment after working 100 hours in a week. That is what startups are all about, right? Long hours grinding it out in front of my computer hacking away on your startup living off ramen.

Wrong… I now realize I was trading short term gains for the long term health of myself and my company.

The startup world glorifies The Struggle because it’s the epidomey of the American dream. A smart, talented underdog takes a risk on himself and struggles for years, only to become wildly successful. We’re fascinated by a founder who pitches 80 VCs while living in his car for three months and finally closes on a term sheet. If that same founder goes onto create a billion dollar company, his story of grit is retold, perpetuating the myth that you need to grind it out to be successful.

Unfortunately, passion and grit do not turn you into a machine and after a year or two, your adrenaline reserves will empty. You are still a human and your brain and body have limits. If you burn out physically and mentally, your willpower is broken and you’re likely to give up. Therefore, the best way to make sure your startup doesn’t die is to avoid burnout in the first place.

Recently I’ve decided my new side project will be working on myself. This list of habits help me acheive more focus, energy, and happiness. My habits are in constant flux and I’ll be updating them as I learn what works and what doesn’t to stay in balance.

I wrote this post mainly for myself, but my hope is that by sharing, I can help a few entrepreneurs who are struggling with balancing the startup lifestyle and a healthy lifestyle. So without further ado, here is my guide for surviving a startup.

Eat well

This seems obvious, but it’s just too convenient to eat a breakfast sandwich every morning or grab a slice of pizza for lunch. I’ve noticed over time that if I eat crap, I feel like crap, think like crap, and my long term performance suffers. Food is fuel for your mind, and your brain requires premium when founding a startup.

Recently I’ve been learning to prepare cheap, healthy meals and cook them myself. Instead of a breakfast sandwich, I wake up 20 minutes early and cook a well-balanced breakfast full of vegetables, eggs, and beans.

Cooking and eating breakfast while thinking about my day has become a morning ritual and a time for deep thought away from the distractions of the day. If I don’t have time in the morning to cook, I’ll eat cereal rich in fiber like steel-cut oats or Kashi Go Lean Crunch.

The other benefit of preparing your own breakfast instead of picking up a bagel or sandwich is that you’ll save money. A typical week’s worth of breakfast supplies consists of a carton of eggs ($2.99), 2 bags of vegetables (2 x $2.99), 2 lbs dried beans ($3.99). That is breakfast for $1.85/day, or less than the cost of a bagel.

For lunch and dinner, I try to stick to meals low in carbs and fats. My favorites are turkey chili, fajitas, and stir fry, along with lots of beans (and occasionally rice). If I’m strapped for time, I’ll use a slow cooker on Sunday to make enough chili for week. The slow cooker is your best friend as it only take a few minutes to throw the ingredients into the pot, and then does all the work of cooking a delicious meal. Preparing meals in mass will also relieve you of the daily mental overhead of figuring out what to eat.


Whether you’re nocturnal or diurnal, sleep at least 6.5 hours a night. Studies show that people who sleep between 6.5 and 7.5 hours a night live the longest. When you are well rested, you’ll also make better decisions and be more pleasant to work with.

I’ve personally found it helpful to unplug from all technology for at least 30 minutes before going to bed. I’ll either read, play guitar, brainstorm a to-do list for the next day, or anything else that keeps me away from my television, laptop, or phone.

I’ve also had success setting a weekly alarm which I’m not allowed to adjust in response to how late I went to bed. If I don’t get my 6.5 hours, I’ll be punished the next day. Remembering how awful I feel on a low amount of sleep is a good motivator for going to bed at a reasonable time.


If you’re a startup founder, there’s a good chance you are not earning a market salary or any salary at all. Unnecessary stressed caused by a low bank balance is avoidable. Learn to budget your expenses and stick to it.

I keep an Excel sheet where I enter in every transaction at the end of the day. You can also use Mint or Simple to track your expenses. Personally, the knowledge that I will have to enter in an expenditure later often forces me to reconsider making an impulse purchase. I also notice patterns when entering the data, like spending money on coffee every morning when I could easily brew it at home. $3/day x 5 days a week x 50 weeks = $750 in savings/year (excluding the expense of ingredients).


Admittedly I am no where near as religious as I would like to be about exercising. I haven’t figured out a daily routine yet that works. I did have minor success with exercising during the morning and am slowly working to rebuild that routine. I personally cannot save exercise for after work because I usually have something else pulling at my time (unfinished code, drinks with the team, dinners, events, etc). In the morning I have no excuse to not exercise except that I was too lazy to wake up and walk to the gym or go for a jog.

Starting small here is important. If you make it a goal to just put your workout clothes on, chances are once you’re dressed, you’ll be able to muster up the energy to hit the pavement or the gym.

Paul Graham says you should only do three things during YC – talk to customers, build product, and exercise. After a run, I also feel invigorated and good about myself, even if I’ve had a terrible day. Exercise is like a reset switch for your brain, and the endorphin production and physical exertion will help you level out the ups and downs of startup life.

Always be learning

Lately I’ve been trying to spend a few hours a week trying out new technologies. I head to the coffee shop for an hour or two on Saturday and try to hack on a fun project to learn something new. In a startup, you’re optimizing to get code implemented fast, and taking time to learn a new technology is not considered an optimal use of time.

In order to keep my skills sharp and my sense of curiosity in tact, I try out a new technology here and there. It usually doesn’t result in anything usable, but the learning does usually make it’s way back into my startup’s product.

Spend 30 minutes a day in the sun

Vitamin D increases weight loss, helps fight depression, strengthen’s your immune system and promotes bone development. The easiest way to get vitamin D is to spend time in the sun. Spending time in the sun also helps fight off seasonal affective disorder during the winter months.

I’ve found it best to combine spending time in the sun with another activity like reading, meditating, writing or exercising.

If you can’t make it out in the sun on a regular basis during the day, invest in a natural sunlight lamp. You’ll feel much better with simulated daylight than the fluorescent lights illuminating your office.

Read a book for 30 minutes a day

Drew Houston initially learned about startups by buying a dozen books on various topics, and reading them on top of his fraternity one summer. He then used that base knowledge to start Dropbox.

Reading is a great way to unwind from a stressful day. People are also trained not to bother you while you’re reading, so it’ll give you some quiet time without having to ask others to leave you alone and seem anti-social.

When I spend time reading, I really try to take the time to enjoy the experience. In school, reading felt like a chore to be finished as quickly as possible so I could move on to other activities. Now I try to read to learn, thinking about how the content applies to my life.

I’ve had huge success in building a reading habit by reading outside. The sun, breeze, and ambient noise really adds to the experience.

charles river boston
My favorite reading spot by the Charles River in Boston

Find a place where you can relax and unwind, and enjoy a good book.

Write 500 words a day

I try to write 500 words on whatever top-level idea is permeating though my brain when I eat my breakfast and drink my coffee. Most of my blog posts start as 500-word free-form brain dumps in Draft. When I hit my 500 words for the day, I stop writing so I don’t burn myself out and leave some writing energy left in the tank.

I’ve found that writing is an excellent way to declutter my thoughts after a stressful day. In David Allen’s book Getting Things Done, he talks about how thoughts can be considered stuff, and the way to get the clutter of stuff out of your brain is to write it down. Once you write a thought down, you are free to forget about it temporarily because you’ve outsourced the memory, allowing you to think about more pressing matters for your startup.

Not only will writing your thoughts down help you organize your mind, but clear and concise communication skills are important for success. Like all skills, communicating effectively takes practice. Spend time harnessing your thoughts about your startup into a cohesive narrative through writing.

If you really want to take it to the next level, I suggest publishing your thoughts on a blog. You will develop your personal brand, which will portray you as a thought-leader and make you a more compelling target for potential business partners or acquirers. If you really want to help your startup, you should write a blog before building your startup. The community you build around your thoughts will help you find new users for your product.

Some of my favorite entrepreneurs who have recently gained traction by blogging which they are applying to their products are Ryan Hoover, Adii Pienaar, Danielle Morrill, and Andrew Chen.

Have wins not tied to your startup

“How’s business?” This is a question my grandmother asks me every time I talk to her. My friends inevitably ask me when we catch up over beers as well. When things aren’t going well, this is a hard question to answer.

Having a startup is hard because when everything’s going poorly, it’s your fault. It is not like a regular job where you might find personal solace by blaming your boss, or your coworkers. When the answer to “how’s business” is “everything is imploding around me”, it’s easy to get discouraged.

If you tie your entire identity to your company and business is rough, you’ll feel defeated. It’s important to have wins that are not dependent on the success of your company.

Set personal goals for activities you do, such as exercising or blogging. If you have an awful week, but manage to break a 6 minute mile or publish three blog posts, you still can look back and tell yourself you’ve had a good week.

If you want to track how well you’re executing on your life goals and feel accomplished when you reach them, is an excellent app for making sure you have small wins throughout the day. Everytime I acheive a daily habit, I get to mark it as complete in Lift. It’s a small gesture, but it helps me feel a daily sense of accomplishment towards myself.

lift screenshot

3 Good Things

I realized a few months ago that I am more pessimistic than I was three years ago, probably because I’ve been beaten down by the startup trough of sorrow over and over again. The good news is, it’s possible to choose optimism, and the best technique I have found for being happier throughout the day is the “3 good things” method.

At the end of the day, recap alone or with someone else three good things that happened that day. They don’t have to be majorly awesome wins either. Hearing a new song you liked, eating a really tasty lunch, or receiving an email from a happy customer are all good things. The goal is to force yourself to remember there are positive events happening throughout your days even if things aren’t working out well with your startup.

Know you’ll face despair

The trough of sorrow is unavoidable for 99% of startups, and the ones that do seem to have everything going right have days when everything is awful behind the scenes. It’s important to remember that in a startup, you’ll have extremely crappy and depressing days, but it’s just one day and tomorrow will be better.

If you can hack your mindset to not ride the startup roller, and instead replace work/life balance with work/life harmony, you’ll be much better off. The only way to do this is to not let the lows get you too low, and not ride the highs too high.

Startups are a long-term career

The startup myth of “sprint as hard as you can for three years and then exit huge to retire rich” almost never happens. Behind almost every successful entrepreneurs are years filled with struggles, learnings, and failed attempts before finally hitting on a successful business idea.

The greatest asset your startup has is you, and it’s critical you take care of yourself to survive the startup marathon.

I hope this recap of my habits has helped a few people. It’s what I wished someone had told me when I first started and came close to burn out.

What habits work for you? Any you disagree with? Leave a comment below.

Why You Should Blog Before You Build Your Startup

typing on type writer

Most startups today do not face technological risks. The building is challenging and grueling, but it is known to be possible. Instead the majority of startups face market risks. It is usually unknown if the market actually wants the product you’re building.

Market risk is often ignored by entrepreneurs, especially technical founders. It is honestly just more interesting to start creating than to validate whether the problem you’re solving is painful and if your customers are actually interested in solving it.

In the early days I think it makes sense to spend minimal time building and instead spend time researching your market. There’s multiple ways to research, but I believe the way with most benefit and least amount effort is to start a blog. Many successful startups were created as blog first startups, including Groupon, AngelList, and Moz. These startups reaped the benefits of blogging before building.

Learn how to reach your target customers

If you can’t find people who are willing to invest 10 minutes reading your blog post, it’s going to be really challenging to find people willing to take the plunge on your product. By blogging, you’ll be forced to flex your distribution muscles to build readership. Luckily, most of the techniques used to find readers in the early days will be useful for finding early customers as well.

Does anyone care?

A popular blog post spreads because it resonates with readers. Building a blog following takes awhile, but you should be able to tell early on if people care about your startup’s pain points. If you are explaining how to solve a true pain point in someone’s life, he will take the time to click a link and read your post. If your readers share your posts on Twitter, Facebook and through email, and leave passionate comments, chances are you’ve hit a nerve with your potential customers.

Build an audience of early adopters

The people who read your posts are self identifying as potential early adopters of your product. Insert a call to action on each of your blog posts that links to a landing page designed to explain your product and gather email addresses. A good example of this technique is the Buffer blog, which strikes a nice balance between delivering content and peddling their product.

buffer blog call to action

Gather feedback

Enable comments on your blog and provide the opportunity for your audience to leave their thoughts. Don’t worry about negative comments – they are a good thing because they show people at least care enough to leave thoughts. Having no comments is probably the worst signal, as it generally means people are not passionate about your market.

Comments will also provide valuable feedback from your audience and start a dialogue with potential early adopters. Disqus comments are optimal because people generally use their real identify, which gives you an opportunity to reach our for more feedback via Twitter or email.

Solidify the pain points

By writing about your market and being forced to condense your ideas into specific blog posts, you’ll solidify exactly what the pain points are your customers face. If your idea is a social network for college students, but you can’t distill what the current challenges college students face when trying to meet peers, you’re in trouble. Teaching is the best litmus test for understanding.

Build with a better understanding

Startup founders, especially technical ones, often forget that users of a product are human. When building software, it’s easy to get wrapped up in edge cases and technical challenges, but writing is an exercise solely designed for communication with other human beings. As you write blog posts about your topic, you’ll build a mental model of exactly the types of people in your target market. Having a mental model of your users, and the exact use cases they are using your product to solve, is invaluable once you start building.

Are you actually interested in your market?

Startups are a long term time investment, usually taking 5-7 years to pan out. When your initial excitement wears off after the first few months, are you still going to be interested enough in the market to grind it out for years? If you can’t even sit down and write a few blog posts related to your market, you may want to think about changing ideas.

What do you think? Are there better ways to validate a startup idea and build an audience? Leave your thoughts and comments below.

Your Fiercest Competitor is Not Another Startup

godzilla vs foe

Right now, there are at least 10 other teams across the globe working to solve the same problem as your startup. They are just as smart, driven, and resourceful as your team. The good news for you is that these teams really don’t matter in changing whether your startup’s outcome will be successful or failure. I’ve personally learned first hand not to get too worked up about new entrants promising disruption of the rental industry and change in the sharing habits of the world through collaborative consumption.

In the early days of Rentabilities, I would stumble across a new competitor about once every two months. Immediately, my blood would seath and I’d frantically navigate every page of their website to compare how they stacked up against our team and our product. A quick email with only a link to the site would be fired off to my cofounder, and we’d spend the next hour on the phone discussing this new potential threat. After the call, I’d spend more precious mental energy dreaming up the possible ways this new rival could crush us, just to make sure we were not blindsided.

In hindsight, I should have realized these new companies were not going to make or break my startup. Most rental merchants use paper calendars, green-screen keyboard-based point-of-sales, or some sort of other cobbled together system to take orders from customers. On the flip side, most consumers use Google and the telephone to find and connect with rental merchants, or just rent from the store they drive past on their way to work everyday. Building intelligent and efficient systems to connect both our merchants and customers is and always has been our hardest challenge with Rentabilities.

This is the case for almost all software startups. You are competing with Microsoft Excel. You are competing against Google and the telephone. You are fighting against people continuing to solve their problems the same way they always have, or not bothering trying to solve their problems at all.

I’m sure Uber’s #1 challenge right now is not competing with other on-demand transportation apps. It’s changing people’s traditional behavior of just walking outside and hailing a taxi. I doubt GrubHub is very worried about other food ordering apps, and instead is trying to figure out ways of stopping their customers from Google searching a restaurant’s name and ordering a pizza over the telephone. Mint’s main competitor was not another software startup in the early days. Their customers either used Microsoft Excel or just had a general laziness towards personal finances.

“Aaron’s father has research experience and we spent countless weeks figuring out what people really wanted before we ever launched our beta. Guess who we found out Mint’s biggest competitor was? No one. Apathy. This shocked me! Most people would rather not track anything and just see how they are doing when they go to the ATM. Guess who was #2? Ms Money, Intuit, Wesabe? NOPE. Microsoft Excel. Who would have believed that!” – Noah Kagan

I often give the advice to new entrepreneurs obsessed with competition to just stop tracking rival teams. Sure, you can take a quick look at their website to check how they are doing, or set up some Google Alerts on their company name, but to spend time talking in circles with your team about competitors is time lost talking about how to solve your customer’s problems. Your fiercest competitor is, and will always be, your potential customers not knowing about your startup or just not caring to solve their problems at all.

Why I Stopped Worrying About My Competitors Success

Being emailed a funding announcement about your direct competitor by 5 different people is not the best way to end the day. That’s exactly what happened to me last Wednesday, when one of our competitors announced another funding round from some of the Valley’s most respected investors.

Personally, I’m not as worried about it as every one thought I would be. I’m actually happy for them and wish them well because over the last two years I’ve learned that competition is an essential part of the startup journey. The reason why I am not upset is because another startup is not who we are fighting on daily basis at Rentabilities. Our main opponents are apathy, inertia, and the status quo.

Having competition is actually good for your startup. It means other smart people have identified your market has issues, and it’s worth their time and money trying to solve them, which probably means if worth your time as well.

VC funded competitors may be good news as well because VCs are generally good at identifying opportunities, and by investing dollars in your market, they at the very least are validating you also have a decent opportunity to make money. If you are looking to raise money too, you now have a decent story where another startup raised funding from a respected firm, and you should merit investment as well because you are better for x, y, and z reasons.

Like most founders, I’m fiercely competitive, and I want to win the market and change the world, My primary focus is on beating the market though, not beating a specific competitor. If we outperform every other startup tackling the same problem on every metric, and that isn’t enough to win the market, we still lose. The motive to do well with your business should not be driven by the desire to beat the competition, it should be driven by the desire to solve your customer’s problems.

In actuality, the founders of competitive startups are probably the few people who really understand the struggles you persist through on a day-to-day basis. A few months ago, one of our competitors moved out of the rental industry to pursue other opportunities. Our teams swapped stories about the market via email and realized we had mostly the same challenges. It’s refreshing to know that we aren’t the only ones struggling through the trough of sorrow in order to bring the rental industry online.

When you’re paranoid about competitors, you’re not paranoid about customers

I do think it’s important to stay on top of industry news and be knowledgeable about competitors , however, it’s a detriment to your startup to focus more on your competition than your customers. When you spend your time discussing with your cofounder what another team may be working on, you are not spending time discussing how to make your product better. Only the paranoid survive, and the survivors are most paranoid about creating an amazing experience for customers.

No one will solve the problem quite like you

Your competitors do not have the same backgrounds as you, so chances are the solutions you design to solve your customers’ problems will be dramatically different. On the small chance that another startup happens to build out the exact product you’ve envisioned, that’s actually a good thing, because now that the product you wanted to exist exists, you can move onto something else and make the world an even better place. The goal of any startup should not be to get rich, it should be to enrich the lives of your customers.

Beware of Startup Vampires

Vampires are some of the most cunning, deadly and feared creatures on Earth and they are killing startups as you read this. Most people think vampires are a myth, but they are in fact very real. With Halloween upon us, it’s important to be on the lookout for these blood sucking fiends, especially when it comes to protecting your startup. Startup vampires are everywhere, and if one manages to infiltrate your ranks, it will slowly suck the life out of your company by draining your most precious resource – time.


I’ve heard bad influences in startups often described as cancer, slowly intoxicating your organization from the inside out. I prefer to think of these bad influences as vampires instead, because unlike cancer, which often can’t be defended against, startup vampires can be defeated.

Vampire investors

One of the the more common types of startup vampires are investors. Investor vampires try to be involved with every decision and force you to waste your precious time explaining why you are making certain choices. They usually need constant progress updates, and instead of spending time working with your team to get shit done, you’re talking with them about how you plan to get shit done. A vampire investor may even force you to have meetings with his vampire buddies to make himself look good by showcasing his portfolio. If you have a feeling that an investor is going to be hard to work with and will probably waste your time, just do yourself a favor and avoid him so he can’t infect you.

Vampire customers

Vampires can also sneak into your startup by posing as customers. Customer vampires usually demand custom features and constantly need one-on-one support, causing you to die a slow and painful death if you are not adept at defending yourself. It’s difficult to differentiate between a customer who legitimately needs a feature and one that is actually a detriment to your success, and it’s up to you to figure out which one is which. If you find your constantly in the weeds with one customer in particular while your other ones are just fine, you may have a vampire on your hands. A good test to see if you have a vampire is to envision the scenario of firing this customer, and if you’re leaping for joy at the thought and think you can move much more quickly by focusing on making your other customers happier, chances are you have a vampire on your hands in need of some slaying.

Vampire employees

The third most common form of vampires are the deadliest of all and can infect and kill your company from the inside out. Yes, I’m talking about the bloodthirsty employee vampire.

We all like to think we’re fantastic at choosing the A%2B players for our team, but sometimes a vampire can infiltrate our ranks without us even realizing it. Employee vampires are skilled at talking a big game without producing many real results. They will keep score of their accomplishments, however minor, so when their vampirism is pointed out, they have a solid defense mounted. They’re adept at persuasion and will probably try to bring the rest of your team down to their level just so they don’t have to work as hard. As a startup founder, it’s your job to drive vampires out of your startup and keep the rest of your team safe from the negativity and ineptitude.

Defending against startup vampires

Is it possible to defend against startup vampires? Yes, and it’s surprisingly easy. Vampires cannot enter a place unless first invited into it, so just don’t invite vampires into your startup in the first place! This fact is so simple, yet subtle, that the main problem at hand is not defeating vampires, it’s figuring out who they are in the first place.

Startup vampires look almost identical to non-vampires so it’s very hard to guess who will end up sucking your startup’s lifeblood. Luckily, the human brain is unbelievably efficient at unconsciously aggregating your experiences into meaningful data for you to quickly react on, more commonly thought of as your gut. Your gut is your single most powerful tool for avoiding vampires. If you met a real vampire, your gut would pick up on its pale skin, aversion to sunlight, and opposition to showing its teeth. When you feel that something is a just not right about a person, that’s your gut warning you that you’re talking with a vampire. and you should avoid that person.

Defeating startup vampires

When you find yourself spending valuable time and mindshare musing with your cofounder or confidant about someone who gives you the creeps, chances are he’s a vampire and it’s your job to go Buffy on his ass and slay him before he starts feeding off your time. If you’re having any doubts about someone, then politely decline to invite that person into your startup, because usually it’s the people you choose to work with that will destroy you, not the people you avoid.

And if you do happen to realize you’ve let a vampire into your startup, you’re going to have to kill him, and the reality is that vampires are extremely hard to kill. They are skilled offensively with super strength and speed, so you’re best offense is to strike before they strike you. Remember that it’s ok to not take an investors term sheet, sign on a new customer, or fire an employee who sucks. It can be painful to have to stab someone with a wooden stake or rip off her head, but once your startup is vampire free, you can proceed stronger than ever before.

Do you have any experiences or horror stories about dealing with startup vampires? Leave your thoughts and questions in the comments below.