Why early-stage startups must imitate early on

If you’re not imitating what industry leaders are already doing in your vertical as a startup, you’re going to be adding months and possibly years of unnecessary testing to your timeline. This is the reason it’s imperative to imitate as a startup.

To be clear, I’m not stating that you should be copying your competitors’ website designs and print copy word for word. When you look at an early Uber or Lyft, they were known for notoriously copying each other on offers, features and more. A recent look at Instagram reveals how they’ve added new features to their product over the last few years to fend off competitors such as Snapchat (Stories) and TikTok (Reels). Instagram is a multibillion-dollar company today and they’re still reaping the benefits from imitation! However, it’s even more critical for startups to imitate than established players.

I’ll be utilizing the Triple I Model to help you understand the startup curve for imitating, and add a few examples from my days working on the growth team at Postmates.

Triple I Model

The Triple I Model consists of three pillars: imitate, iterate, and innovate. As a startup, you’ll be faced with opportunities to do these, but how you emphasize each bucket will be crucial in the early stages.

While trying to find product-market-fit in the early years, most of your time and attention should be focused on the imitation bucket. This means drawing inspiration from competitors on their ads, emails, website, and all other consumer touchpoints. There’s a clear line between copying everything a competitor does exactly and using frameworks outside while adding your own flavor. Just make sure you do the latter!

The type of testing should vary over time. Image Credits: Jonathan Martinez

Iterating can happen in tandem as you achieve wins from successful imitations, and it should be a constant process to improve metrics. If you do feel you have a groundbreaking idea you’d like to test, you are not prohibited from doing so. However, it must be said that these ‘home run swings’ should be reserved for those times when there are ample resources to allow for experimentation.

Imitating on paid acquisition

At Postmates, most of my time was spent scaling our acquisition efforts from $50,000/month to $5M/month. After raising $300 million series E, we had plenty of monetary resources to scale as we unlocked new paid channels. However, we still lacked adequate resources on the design side. Our team had to get crafty with repurposing creative or imitating designs that DoorDash and other competitors were launching. I personally kept an eye on the competitors and their ad libraries on a weekly basis to make sure we stayed on top of any trends.

To speed up imitation on paid acquisition, Facebook has an ad library where you can search for companies and see all the ads that they’re currently running. A trick here is to look at the date the company launched an asset, because often it is the ads that were running the longest that are the most performant.

Outside of our competitor set at Postmates in the food-delivery space, I would also look through top brands that were known for cutting-edge tactics. This helped me decide on the pillars we needed to test if I saw patterns emerging among the many companies I followed. In 2022, user-generated-content became King, and many advertisers picked up on that trend by launching their own versions of this ad pillar.

Instead of going to my design team at Postmates with ten pillars I wanted to test, which would be impossible resource-wise, I would approach them with two pillars that I knew were working based on competitors’ ad launches.

Imitating on activation

The other steps in the growth funnel, such as activation, won’t be as obvious to imitate as acquisition, where ads are public on platforms such as Facebook. So how does one draw inspiration?

Most of my fellow former employees at Postmates would sign up for DoorDash and other competitor accounts to understand how they were onboarding users and the types of emails they were sending. Many on the product team would be testing competitor products every week. If you’re not already going through your competitor’s funnel, this is an absolute must. It’s not enough to sign up once since your competitors are constantly experimenting themselves so make sure to set up a regular cadence for checking in on how they’re pushing users through the funnel. By doing this, you’ll be piggy-backing off the work they’re doing on the experimentation front.

There are also resources, such as reallygoodemails.com, which is an online library of emails that companies are sending that you can obtain ideas from. In addition, hopping on calls with past employees of your competitors can be a very fruitful way to expedite learnings on their growth tactics.

After Postmates was acquired by Uber in 2020, I landed on the growth team there where I learned how many resources went into competitive research. As a public company worth $89.9 billion in 2020, Uber was still investing vast resources to imitate the top styles and ideas from other players in the industry. It shows that no matter the size of the company, imitation is still happening and very few are spending time on innovating. Why? Again, it’s resource intensive. The famous Superbowl QR code ad at Coinbase took several months to create as we weren’t imitating others, and it took an immense time to ideate on and test. What may seem like simple decisions, such as if we should let the QR code touch the corner perfectly became part of large debates to analyze the pros and cons of each variation. There were also major efforts on making sure the QR code was scannable on various TV sizes and resolutions.

When to start innovating

If you’ve exhausted all imitations in paid acquisition, your email copy and content, promo offerings, and other growth efforts, then it’s your time to innovate. However, that should never actually happen as there will always be something or someone else to imitate. If it’s not your direct competitor, it’s someone in your vertical, or even further removed, such as an industry growth leader.

Instead of thinking about when to innovate, the question should be whether an innovative growth idea will outweigh X number of imitations with the same resources.

Example simulation of test output for imitating, iterating and innovating. Image courtesy of Jonathan Martinez.

I’m not saying you shouldn’t innovate. I have done this when consulting for small seed-startups. What I am saying is that instead of expending so many resources on the uncertainty of innovation,  early on there’s so much more for your startup to gain from imitation. Conserve your resources to innovate for high-probability tests that you’re excited to try at various stages of your startup’s life.