What the Health is Happening? Trying to be a “Market Creator” is Crap, and Don’t Waste Your Time Stalking Competitors (Part I)

4179063482_e8184e27a1_z.jpg

By Jen McCabe (Founder & CEO, Habit Labs) As a startup founder, it’s often tough to figure out what news has direct import for your sector.

One commonly adopted habit path I’ve seen fellow founders pursue is to sit down, crack the laptop, slam a Red Bull or coffee, open up Hacker News/TechCrunch, and wallow around for a bit reading whatever looks interesting or has a ton of upvotes. This is a pretty broad-spectrum approach for post-launch self-education.

Before you know it, 3 hours has disappeared. And while you should be keeping in touch with tech in general, you should also be getting to know your industry experts. After your team scrum, their content should be the first thing you consume. (And you should be helping generate it, but that’s post for another time). Unfortunately, a lot of industry coverage is opinion-based + qualitative which makes it near useless in your strategic planning.

Luckily, in health we don’t have that problem. The analysts and writers who cover our sector are committed and constructive. They’re critical-thinkers eminently capable of deep dives into stats.

  • John Moore of Chilmark Research writes and compiles some of the best damn data about our emerging DTC (direct-to-consumer/direct-to-clinician) health sector, period.
  • Brian Dolan, Chris Gillo, and the team at MobiHealthNews performs top-notch comparative analysis like none other.

Reading their material over the last few months tells one story consistently: the mobile health market is incubating at a more accelerated pace than ever before in my 3 years in the sector. And the supporting data is finally quantitative.

This morning I started working on an analysis of this report for our internal use at Habit Labs over the next 12 months. October 7th is the one year “birthday” of Health Month, and we’ve got a hot and heavy strategic planning session coming up. I spent an hour reading the report, reading related market-oriented emails that have come in through investor and founder backchannels, and putting together a document for our team Posterous. It occurred to me that the "implications" portion of the report (in particular) may be of wider interest. Almost immediately after finishing the doc, I wanted to publish this externally, but hesitated.

A weird thing happens when you found a startup, especially one in a sector that’s getting as crowded as ours (social health).

Post-launch, you realize this is a long-haul slog towards solving a BIG problem, and you sometimes get paranoid about what other people are doing (or not doing). Realizing you’re competing for scarce resources (money, talent, timing to name a few) you might start to feel too protective of your tech, your team, your viewpoints, and just about everything else that’s considered an "asset."

There’s a lot in startup life you can’t control, and worrying about or "assessing" competitors is something that gives you more of a sense of perceived "master of the universe" status. But this is an illusion. Worrying about competitors engenders a sense of "perceived" control, rather than gifting you back any sort of "actual" control. And, even worse, if you let this competitive focus get the best of you, you spend more time worrying about external factors like competitors and less time focused on internal factors like getting and keeping your house in order.

Luckily, my team is a hell of a lot smarter than I am, and has experienced founder paranoia before. They know just what to do. At Habit Labs, Buster has single-handedly kept me (mostly:) from being a complete jacka*& and being overly "reactive" in response to the changing competitive landscape. He’s taught me, over the past 6 months, an invaluable lesson: Competitive advantage doesn’t arise from ideation or the "unique" view you have of the market. It arises from building the sh*t out of something people love (PG also tried to teach me this one, but I was infinitely more stubborn last summer). It arises from being proactive. It arises from knowing the problem intimately, throwing solutions at it obsessively, until you own the solution. It’s a "problem" oriented focus, not a market or market positioning oriented focus.

This means feeling competitive is pretty much mental masturbation at this stage. The only competition we really have is internal. When we execute on our very unique vision by building defensible, "heavy lifting" tech we will not only "own" the problem of health behavior change, we’ll also "own" the solution.

Lessons learned (the hard way):

  1. Quit worrying so much about the competition.
  2. Don’t waste your time worrying about what everyone else is doing.
  3. Keep an eye on the market, adjust plans at the micro level, but if the market or competitors really surprise you, you probably haven’t been paying enough attention (or your team doesn’t count ‘experienced market creators/visionaries’ as part of the ranks).

Trying to be a market creator is complete BS. Anyone who pitches me on market creation without pitching me on product and team I immediately discount. Why? The first time around with a company, especially if you’re creating something new, almost always fails. First movers are often martyred. They learn about a space, get a good launch going, but don’t focus ENOUGH on product and team before pushing the accelerator on trying to test product-market fit (Blackbox’s Startup Genome Report would call this Death by Premature Scaling).

If you’re a problem-focused founder, as opposed to a market-oriented founder, keep swinging away at that bigger issue.

If you "own" the problem and obsessively evolve the product(s) around it, your market will follow. All that said, you should keep an eye on your market, mainly so you know how to pitch to it when you DO launch a solution and test product-market fit... More on how to do that in part II!

This post was originally posted at Habit Labs' blog.

Photo credit: David Blackwell on Flickr.

About the guest blogger: Jen McCabe is Founder and CEO of Habit Labs. Last summer, Jen founded her first startup -- YCombinator backed Contagion Health, which merged with Buster’s Healthmonth to create Habit Labs. Contagion was seed funded by Founders Fund Angel and Esther Dyson. Contagion built Get Up and Move, the first social health challenge site, which let users invite family and friends to small, healthy acts (“microchoices”) using Twitter, Facebook, and email. Follow her on Twitter at @jensmccabe and her startup at @habitlabs.