When the inevitable question comes up at an investor pitch “who is your competition”, it is almost always a good thing to have identifiable competitors, even though the technopreneur may think and feel otherwise. Investors go where there is competition.

Competition validates the category

There is no such thing as a “category of one”, and investors invest in a category, so don’t expect an investor to invest unless there is competition. If you find yourself alone in a market wondering where all the competition is, you may well be standing alone with no real customers. It is safe to assume that there are other smart people out there, and that they would have independently come up with a similar idea to solve the problem. “Anything that’s worth doing has a form of it around already.”

Competition allows the market to take off

When you set out to educate the world to your way of thinking about a new product or service, it is a lonely job if there is no competition. People will take more notice when an ecosystem forms around the problem you’re solving. The more they hear about a problem, the more urgently they need to fix it. And as competitors enter the market, corporate sponsors may express interest, new avenues for market research will open up, more capital enters your category.

The more competition, the more opportunity

And your customers become evangelists themselves, posting positive reviews of your product and spreading the word about why you’re better than your competitors. While these loyal customers create trust for your company, the presence of competition allows the market itself to flourish. 

Learn from the competition

Our competition can teach us the biggest lessons.  One can learn lessons on how to scale the business properly, what strategies work etc. from a competitor that may be further advanced than you. You can have the benefit of picking and choosing from competitor propositions without sacrificing time and money on research and development. The lessons you learn from your competition are priceless as long as you are willing to listen, learn, and implement.

Competition is good for innovation and focus

Competition leads to innovation. If you’re the only player in your field, it can be difficult to improve. And if you’re working in a crowded market, you won’t succeed by doing what everyone else does. Healthy competition encourages the change that will distinguish your company from others through technology, product alterations or by improving the customer experience.

Competition forces you to focus on your core audience. If you are targeting a specific geographical location or demographic, market challengers encourage you to better understand that setting. In doing so, you will be able to better provide for that group.

Competition is good for the category

Thus investors and so should the technopreneur welcome competition, not only because it validates the category, but because it is good for the category, the business opportunity and the chances of success, provided the technopreneur is not intimidated by the presence of competition and can channel the positives.