On competition and hurricanes
I love competition. Competition raises your game. Competition educates people about the problem you solve. Competition shows you different ways to build a business. Competition helps you to understand how well you're doing.
Since we started Customer.io we've been under constant pressure from competitors. Here's an overview of our competitive landscape.
Where is our competition coming from?
Our space became HOT over the past 9 months or so.
I've counted 10+ splash pages of companies at least interested in our space. One raised a TON of money, pivoted in to the space and is in Private Beta. Another started when we did, raised a decent chunk of money but has been pretty quiet.
Usually in conversations there are 3 - 4 players mentioned. We're luckily often one of them.
There are also a couple of well known analytics companies. They've both got deep pockets and have been talking about entering our market. We've talked with them from the beginning.
One did so last week. We expect the other one to come in within 6 months.
Look for players in Email and Marketing Automation to start dipping their toes in behavioral email soon enough.
What have our experiences been with competitors
Overall, great. This is a space that I enjoy participating in. We attended Inbox Love recently and had a great time meeting up with people there. It was great to get a shout out from Ev @ Mailgun on our product, as well as compliments about our weekly email advice from numerous people there.
And when it comes to our direct competitors we've seen two pretty distinct types.
- We've grabbed beers to talk about macro trends / competition
- Referrals (both inbound and outbound) when another product makes more sense.
- Encouragement (both inbound and outbound) over work well done.
- Reaching out to customers to poach them
- "Borrowing" website copy
- Telling us to quit because they're coming
How will you survive against companies with more money?
I spoke with Chris, the CEO @ Wistia about their experience, and he shared their tremendously encouraging experience in the video hosting space.
When they started, things looked bleak. There were competitors with A LOT of money in the bank going after the same space.
Their competitors all flamed out gloriously while Wistia quietly and steadily grew.
They outlived their competitors and are now left with the market.
What we expect to happen
We're in it for the long-haul.
Just as in Wistia's market, I expect some companies to go big then go broke.
I expect others will dabble and throw up a landing page, but then decide not to leave their day jobs.
A few will try to carve out their niche in the space, and if their bootstrapped, they'll survive. If they're not and have investor pressure, they'll pivot or die.
As for us, we'll continue on our path. Powered by the love of our customers (and the cash they exchange for our service), we'll continue to innovate and plan to lead this space.
Here's a chart of our monthly subscribers.
So should you worry about competitors?
I maybe spend 2% of my time thinking about our competitors and 98% thinking about how we can serve customers better.
Worrying about competitors forces you to be reactive rather than proactive. And it leaves you comparing your decisions or features against theirs.
Sometimes though, your competitors get up in your grill and force you to worry about them, or prospects ask you to compare yourself to a competitor.
You should worry about competition in the same way you worry about hurricanes
I'm sitting at home writing this as Hurricane Sandy approaches.
The hurricane will come, and it will be terrible. It has already destroyed areas of beach front and has taken the front off of a building in NYC.
But you can only prepare so much. Sometimes you have to just wait and let it do what it will do. Then pick up the pieces the next morning.