We are an underdog ourselves, so consider our discussion here as a live experiment in itself.
We have naively chosen to enter into a market that is crowded with competition.
What is worse, we have landed ourselves in an unsexy or niche market that has little venture money.
In retrospect, none of these matters because the reality is that we are already in the battle fighting for our survival.
If you have faith like us that your start-up has a fighting chance of winning then these are our suggestions on what you can do to turn the tides to your advantage.
My short couple of years in the army has taught me that if we are already in the shit and shit happens, its time to focus on fighting our way out.
Stop all that self pity and grumbling about how we should have done things otherwise and start accessing the situation properly.
The worst thing to do is to panic.
Rather, the most important thing to do in such situation is to establish control over what is happening.
Below are some of our recommendations that have worked well for us.
Calm the situation and restore their fighting spirit If your start-up is in a panic situation, the first thing that you will hear all around you is negative voices.
When people around you smells the fear and they are overwhelmed by it, you start hearing the "we are going to die!" speech.
This is where leadership comes in, filter them out! Why? Because they will affect your start-up's morale tremendously.
When morale hits rock bottom, your team will give up fighting and that will be the end of the game.
Motivation is key here.
Figure out how to raise the morale of your team by doing everything necessary to reduce the fears that they have.
If their fear is that they will not get paid, then go out and beg family and friends for money or get a loan from the bank.
The objective is to calm the situation and restore their fighting spirit.
Regroup Sit down with your team and figure out your start-up's strengths and weaknesses.
If your product is not gaining traction then figure out what is the strengths and weaknesses of your product.
This is important because you need to know how to exploit these factors as you move forward.
Sometimes your strengths alone is good enough to help you gather some momentum going.
Remember, you don't need to have the world's best product before good things start happening.
However, having an idea of what are the things that can produce motion will help you figure out where to push towards to reach some momentum.
You will need feedback from all angles such as your team, your users and customers.
Your users may not necessarily be your customers.
Some people will use your product but they will never pay you for it.
Analyze all these information to give you some clear direction on where to head towards.
Try to do as little guessing as possible, the more hard data you have the more accurate you will be.
Focus on where the money is coming from Your team will need to figure out who are your real customers.
When we say real customers, we mean those who will pay you in order to use your product or those who you earn money from.
If you do not yet have paying customers, that means that you have not yet found your product to market fit yet.
You don't have to be too logical here, reach out to as many types of industries as you can or as you can think of and see which are the ones that respond to your product.
Follow the smell of the money trail.
If you can sell your product to one customer of a particular industry, chances are you can sell it to others of the same industry as well.
Don't try to be too smart here because you should let your customers choose you and not the other way around.
The reason that you have not found a product to market fit is because your brain is getting in the way and you have been targeting the wrong group of people previously.
Know your competitors well The next move is to figure out what your competition is doing and where they are heading.
Understanding how your competition is fighting the battle will give you some insights into how to out maneuver them.
It will also often show you were the customer needs are without doing all the hard work yourself.
That is also why many start-ups will sign up accounts with their competitors.
It is not a real surprise because this kind of practices are common with web applications.
In order to win the game, you got to know what your competitors are doing.
Change the way the game is played But it will take more than knowing the competition to win.
Knowing your competitors merely ensure that you are able to compete with them but it does not give you the winning advantage.
Thinking out of the box is important here.
If you are coming into the game where there are already many establish players, you need to change the way the game is played in order to win.
There is a reason why tons of copy cat applications do not end up winning.
If you play the game exactly like your competitors and they are 5 years ahead of you in customer development and features then your chances of winning against them are very low.
You need to figure out how to exploit their weaknesses to gain the upper hand.
One of the common weakness of established players is that they are very comfortable with what they already have and are unwilling to switch from the way they have been doing things in the last while.
Google and Yahoo is a very good example.
Yahoo was initially winning the game because they focus on the direction that you can find anything you want with Yahoo.
But Google changed the way the game is played by telling everyone that you can find everything faster and more accurate with Google.
Their market and solution are basically the same, which is helping online people find things they want on the web.
Yahoo was approximately 4 years ahead of Google in terms of customer development and features.
But Goolge effectively changed the way the game is played by giving everyone a simple entry field with no clutter and faster, as well as, better search results while Yahoo continued with their information rich search portals.
The effect of changing the way the game is played is clear, almost all search engines today follow the same concepts as Google.
Stay grounded and focus on how to reach your goals What are the goals you want to achieve? What do you think you can do to get there? You don't really need to change the world in 3 months.
This type of overnight success concept seems to be the new virus that is spreading around infecting many start-ups.
Many VCs and popular technology blogs would want us to believe it.
It is almost like brain washing.
If you believe in this, you are heading towards disappointment because the odds are really against you.
Stay grounded in reality! Build your start-up one step at a time with clear goals and detailed steps on how to achieve them.
Don't waste your time talking about how you want to change the world when you have not even figured out how to stay alive in the next 3 months.
Don't set goals that are so big that you cannot realistically achieve it in any given time.
Set goals to solve your immediate problems and work out practical ways to fulfill them.
When you have clear direction based on these goals then start working your butt off to get them done.
As your start-up grow, your goals will naturally become broader because you will now have more resources such as money and manpower to achieve them.
With this approach, changing the world is a natural progression of your growth and no magic is required in between.
None of the points above are of any order.
You could be working on multiple points at any one time or just one.
If you combine point 2 and point 4 of this article, you should be able to see clearly if you are contributing something significant or new.
Even if you are not innovative, if you could figure out point 3 and point 5 as you press forward, you can still win the game as an underdog.
The points listed here are not some academic theory about how you can succeed as an underdog but rather guidelines that we have figured out so far.
We are trying to implement all these guidelines ourselves as we press on ahead and we hope that it will be useful to you as well.