Ask HN: Join forces or compete with big player?
We're a year into a project with moderate traction, and just found out that a big company in our industry is building their own similar system. It won't replace ours and they did nothing wrong (like copy us), they're just heading in the same direction.
Any experience with this? Did you reach out to them and join forces or stay quiet and compete? (If we wrote them a proposal, we'd be giving away our secret sauce.)
It looks like a side gig for them, but one they're investing in heavily. Not sure what a win-win arrangement looks like.
5 comments
[ 2.9 ms ] story [ 20.1 ms ] threadIf you haven't invested a lot, and you are very profitable, then you should compete with them. You have low risk and high reward.
If you've invested a lot, and you aren't very profitable, then I would probably reach out to them to see what arrangement you can set up. The idea here is that you want to protect your original investment. If they start soaking up customers and you guys start losing money, then you go out of business and lose all your money.
And if you're kind of in the middle, it's a bit of a coin toss. You probably should double down, acquire some big customers and more traction, and then decide if you should sell the company if future prospects don't look good.
A profitable buyout is a profitable buyout. If you don't see a path to becoming a massively profitable business, then go get bought (Github) or set up a scammy IPO (Blue Apron)
I think a good rule of thumb is, "if customers aren't banging down the door trying to buy our product, we either need to risk more resources for a chance at growth, or raise our margins and pray we survive"
Maybe look at partnering with one of their competitors.