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Comment by thrwaway69 | Hacker News Reader

I wonder what can you do to stop a big company from devouring your share in the SaaS market. What strategies are there?

GitHub devour-ed a lot of tools built for it.

Google do it with their search cards, amp and many other micro things.

Apple does it with incredibly popular apps and integration.

Every big company in short do it and they all have big pockets to lose money on the software until competition is sucked out. Unlike hardware, where you will be pressed with anti-competitive charges [0] for above. It doesn't seem to happen with SaaS.

0] https://tech.co/news/eu-fine-qualcomm-2019-07

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The only things that work are:

- Stay under the radar.

- Change your product into a product that threatens their core business model. (for example against facebook you would offer privacy because they could not offer that without weaking their core tracking you/selling ads business)

- You offer something that bridges two other companies. Think plug-in that pulls from all major crmes.

- You offer something grey market.

- You compete head to head with a better product.

Never let one of these big companies pretend to buy you while they delay and steal your ideas either.

> Change your product into a product that threatens their core business model. (for example against facebook you would offer privacy because they could not offer that without weaking their core tracking you/selling ads business.

That is probably fine in this case but what reason is there for them to not lose money to control other parts of the market?

Facebook brought whatsapp, mind you and many others.

Worth noting that the FB acquisition of WhatsApp was a massive unicorn success for the WA team. While the point doesn't hold, the "breaking" of it is the best case outcome for the people who build the product.

This is very correct. But you do not need to stay under the radar, just create a product that the PM in the big tech will never do.

For system products that would be:

1) Build on Kubernetes. This is the only true open ecosystem.

2) Go Multicloud. Always support at least three clouds.

3) Make the edge your primary target.

It's not only a software thing; Amazon has been accused (or sued?) for anti-competitive behavior by creating "Amazon Essentials" version of lots of very popular items being sold through their site, even advertising the Amazon branded item right on the original product's detail page.

Yeah. I think platforms should become neutral after certain adoption. It gives the company lot of unnecessary leverage. Apple can block off APIs to their apps only, google can do it, microsoft can do it, Amazon can (though they don't have as big of a share of online retail market but still enough).

> become neutral after certain adoption

No business should be required to let other businesses screw it over because "neutrality". There really is no such as a "neutral" when it comes to this anyway.

You have been to a grocery store and seen the store brands? Same thing.

Most of those store brands are made by the same companies making their brands. They're getting paid for them, too.

Same happens in brick and mortar stores. Im germany a drug store chain had a decade lomg partnership with an organic products / plant milk producer who did a lot to buold the market, and when the market actually got more mainstream and profitbale, they kicked them out and replaced them their new house line of organic products.

You are right but it's the scale that is worrying.

Tech is accessible everywhere. What it does is set certain expectations for users in different countries. In india, most people won't pay for apps and they are not profitable to run many services which big companies do for free.

Maybe it's good in the short term. For consumers, certainly but I wonder if tech will become stagnated like other industries with monopolistic control.

> I wonder what can you do to stop a big company from devouring your share in the SaaS market

Make a product that seamlessly integrates with the rest of their ecosystem so they're more likely to acquire you than replace you.

That assumes being acquired is good but that's only a probability. They can have a closed ecosystem so you can't even begin trying to integrate everything. But they can use those internal APIs themselves.

That's not what happened for CircleCI. They're still going, but they have to be nervous about the CI features in GitHub Actions.

>I wonder what can you do to stop a big company from devouring...

Two things:

1) As the other poster said, make your product so compelling that the behemoth company simply acquires you.

2) Try hard to make sure you're not competing against them, nor will they decide to compete against you in the future.

So either do such a great job you get bought out (which will probably be a negative in the long term for your users, but financially it should be a huge win for you), or just don't bother, and find something else to do that doesn't compete with a huge tech company.

Both options fuck with the competitive free market just the same.

The market would disagree with you - where's this hurt to the "competitive free market" you mention? Have yet to see it.

In the plain simple fact that it reduces competition.

If you get squashed by virtue of clout then competition gets eliminated. If get bought out to avoid getting squashed then potential competition gets eliminated. Or you don't bother to compete and there's no competition to begin with.

In other industries, this is what patents are supposed to be for.

Absolutely not. Patents are for encouraging disclosure of useful things. They aren't to grant monopolies to whomever develops a slightly different business.

I think that is arguable.

From the US constitution:

> To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.

You could argue the monopoly grant is purely intended as an incentive to publish. I think the accepted interpretation is that it is intended as an incentive to invent as well as publish those inventions.

IMHO the merits of that logic are open to debate though. Not a big fan of IP myself.

Where is this at in the US Constitution?

Article I, Section 8, Clause 8

https://en.wikipedia.org/wiki/Copyright_Clause

The function of a patent is to give a temporarily monopoly to someone who has invented something new. It’s disingenuous to say “slightly different business” as if that’s the only possibility. It is true that they encourage disclosure, but they also obviously encourage invention of things by letting you make monopoly profits on them for a limited time.

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