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The narrative of the little guy going up against the hulking giant is baked into the history of Silicon Valley, starting with the traitorous eight leaving Shockley Semiconductor to subsequently found Intel, AMD, Kleiner Perkins, and many other industry disruptors of their time.  Fighting unnaturally large battles is part of the technology industry’s DNA, and yet it would seem that every startup begins the process anew, rewriting the story of how to compete and succeed in the face of formidably large competitors. There are times when competing against the incumbent feels like an insurmountable challenge (and by “times,” I mean pretty much every day).  Your larger, more established and better-resourced competitor is an ominous and omnipresent danger to your existence.  It will subsidize its products to compete with you, monopolize the distribution channel, spend more on marketing a single launch than you will ever raise, and create uncertainty in the market about your product among customers.  Given all this, startups should be in an inherently disadvantaged position in any market, emerging or mature.  And in most industries outside of technology – those that rely on high fixed costs, retail distribution, or a vast network of partners – this is absolutely the case.  But in the world of internet-delivered services, rapid innovation and evolution, and constant disruption, no one’s power is guaranteed.  This creates huge opportunities for startups going up against the big guys, if executed properly.

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