How can a SaaS startup survive in a crowded market?

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JASON LEMKIN

“Crowded” is either really important, or unimportant 🙂

What I mean is, you do need to be 10x better than the competition at something — or else competition will eat you alive, or at least, trap you in a lower growth / high cost paradigm.

It could be brand alone that you are 10x “better at” if you are far and away #1. It could be one critical feature the other guys don’t do well. It could be a vertical specialization. It could be a different buyer. Or unique integrations. Lots of things.

Markets can seem crowded from the outside, but it may be that many of the participants don’t have a 100% direct competitor for their core use case and buyer.

By contrast, sometimes there may only be 2 players, but the products are fungible and competition is 100% and fierce.

>> My rough learning is if you hit $1m ARR growing >=10% a month, competition isn’t really hurting you, no matter how it may feel <<

See Stewart Butterfield and David Sack with compare-and-contrast views on this topic here from ’15 SaaStr Annual

And more here: https://www.saastr.com/as-long-as-you-are-growing-50-your-competition-cant-kill-you/

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Published on May 27, 2016
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