Play Stupid Games, Win Stupid Prizes

I think when you're being authentic, you don't really mind competition that much. Yeah, it pisses you off and inspires some fear and jealousy and all the other emotions that come along with it. But also, you don't really mind because you're more oriented towards the goal and the mission.

And worst case, you get some ideas from them, and there's often ways to work with the competition in a positive way, and it ends up increasing the size of the market for you. Yeah, sometimes it depends on the nature of the business. Silicon Valley tech industry businesses tend to be winner-take-all, at least the good ones.

So, when you see competition, it can make you fly into a rage because it really does endanger everything you've built. Whereas if I was opening a restaurant, and a more interesting version of the same restaurant opens up in a different town, that's fantastic. I'm just gonna lift from them what's working and drop what I can see that they have already figured out is not working.

So, it does depend, to some extent, on the nature of the business. That said, even the businesses that seem like they are often in direct competition really aren't. They can end up adjacent or slightly different; you're one step away from a completely different business.

Sometimes you need to take that one step, and you're not gonna be able to take it if you're busy fighting over a booby prize. Kind of, you're playing stupid gaming, and I win a stupid prize. It's not obvious right now because you're blinded by competition, but three years from now, it'll be obvious.

To give a simple example: when I was first starting companies, one of my first ones was called Opinions, which was an online product review site for all the products out there that was independent of Amazon. That space eventually turned into TripAdvisor and Yelp, which is where we should have gone. We should have done more local reviews because there's more value to having a review of a scarce item, like in your local restaurant, than there is of an item like a camera, which was gonna have a thousand reviews on Amazon.

But before we could get there, we got caught up in the whole comparison shopping game. So, we ended up merging with DealTime and we competed with MySimon and Bizrate, which became Shopzilla and PriceGrabber and NextTag, and a whole bunch of these price comparison engines. We were all caught in fierce competition with each other, and that whole space went to zero because it turns out Amazon won the tail completely.

So, there was no need for price comparison; everyone just went to Amazon. But we got the booby prize because we were caught in a competition with a bunch of our peers when really we should have been looking at what the consumer really wanted and being authentic to ourselves, which was reviews in that price comparison. We should have gone more and more into more and more esoteric items that needed to be reviewed, where customers had less and less data and wanted reviews more badly.

So, if we'd stayed authentic to ourselves, we would have done better.