How To Compete Against Massive Companies (And Win) As A Bootstrapped Business

0:00No child deserves to go hungry, especially at school. But right now, some politicians are cutting funding to programs that help kids access free meals at school while handing out tax breaks to billionaires. Hungry kids can't focus and learn. The National Education Association is made up of 3 million educators and allies across the country dedicated to making sure every child has the support they need to thrive in the classroom. Help the NEA keep hungry kids fed at school. Learn more at nea.org slash nutrition.

0:57you know, actually run your small business. Learn more at linkedin.com slash MBA show. When I launched Webinar Ninja, I was competing against GoToWebinar, a company that's backed by Citrix, a$13 billion corporation. Then Zoom entered the webinar space, one of the most recognizable brands on the planet, hundreds of millions in funding, brand awareness most companies would spend decades trying to build. And we were a bootstrap team. No outside funding, no enterprise sales force, no marketing budget that could even touch theirs. And we still competed, served over 30 ,000 users and got acquired by ProProfs in 2024.

1:39So how does a small bootstrap business compete against the giants? Well, that's what today's episode is all about. Not the motivational version. I'm talking about the tactical version, the actual what to do to compete. I'm going to share with you exactly what we did, what the real advantages are of being small, and the mistakes that you should avoid that kill most bootstrap businesses before they even start. Let's go.

2:10Welcome back to the$100 MBA show. I'm your host Omar Zinhome, where I deliver practical business lessons three times a week, Monday, Wednesday, and Friday to help you start, grow, and scale your business. If this show has helped in any way, it would be amazing if you could drop us a quick review on whatever app you're using to listen to this podcast right now. It helps me and my team bring new episodes every week. And more importantly, more entrepreneurs will be able to discover our podcast so you can help someone else start their journey. Thanks so much. Before I get into the how, we need to define what winning means.

2:47Because if you go into this competition trying to beat the big players at their own game, you've already lost. You're not trying to become bigger than them. You're not trying to out market them. You're not trying to outfund them. You're not trying to out resource them. These are their strengths. What you're trying to do so you can win is to dominate a corner of the market so decisively that you become the obvious choice for a specific customer. Again, you want to become the obvious choice for a specific customer and build your whole business around that so that you can thrive for those specific customers.

3:22The big players, they cater to a big market and they're more like generalists. Being a small player, you need to be really good at something specific for a specific group. And the reason why we did this is because our goal from day one for Webinar Ninja was building something valuable enough to be acquired one day. That's why when people ask me, what did it feel like to sell your company to be acquired? The honest answer is I felt relief. I felt relief that I succeeded, that I didn't mess it up, that my plan worked. But the point I'm making here is that you need to define your success. It might be completely different for you.

3:55Maybe you don't want to be acquired. Maybe you want to build a lifestyle business, whatever it might be. But the point here is, is that you need to define the rules of your own game and what the finish line is. What is success? What is winning? And I found that whatever that goal is, it's easiest to reach those goals when you are owning a niche so completely that the giants don't even try to compete with you in it. They're like, okay, that's Webinar Ninja's Corner. We're not really going to try to niche our product to cater to those customers because it really is going to be too much headache for us to do that.

4:29Building a competitive business requires you to be strategic, And that is the strategy that works when you're competing against giants. Everything else flows from that. Let's get into why you are actually in a good position. You have some huge advantages by being small. Here's the first thing a bootstrap business has that a large company genuinely cannot match. They cannot do this. And this is speed. When you are small, the distance between an idea and execution is measured in days, not quarters, not months. At Webinar Ninja, a customer would give us a feature request and give us an idea for a new feature that they would like.

5:07The next day, I would sit down with my team, with my engineers, with our project managers, and we would discuss this idea. We would talk about what does it look like. We would sketch it out live on a Zoom call. And within two weeks, that feature was live in the software. Two weeks! Why? Because there's no approval chains. There's no committee to sign off. There's no alignment meetings across departments. We decide, we build, we ship. End of story. Do you know how long it takes a company like GoToWebinar or Zoom to add a feature? Months, sometimes years. They got to think about so many other things, especially if they're a public company.

5:43How does this affect shareholder value? How does this affect our stakeholders? All this stuff. All we cared about is serving our customers. Our only stakeholders were our customers. And by the time these big companies' roadmap committees have approved the concept of a new feature, They write a brief. They assign the engineering team. They push it through QA. We've already shipped it. It's done and dusted. It's already in the software. It's already on our sales page. It's already part of our feature list. And we're moving on to the next thing. And we're able to iterate on that feature and improve the product over and over many iterations before they actually release version number one.

6:22So speed is your structural advantage. No amount of money can compensate for that. I love being around startups and small businesses because of this. They have agility. They have the autonomy to just go out and make things happen. This is an exciting moment for business where they can just go ahead and produce value for their customers on demand. Now, let me tell you about the specific advantage that I believe was the single biggest factor Webinar Ninja was successful. And here it is. Customer support. I know that doesn't sound glamorous. I know it kind of might surprise you. Like, isn't it like some sort of keystone feature?

7:04Some crazy innovation? Yeah, it's not the thing that gets written up in tech blogs or featured in case studies about disruptive innovation, right? But remember the game you're playing. Remember what I said before? That crazy innovation that gets fueled with a lot of money or whether it's a marketing campaign, that's the advantage of the big players. I'm not going to play their game. Our advantage is care. And they drop the ball when it comes to care. The last thing they think about is customer support. So we built it as our weapon. Here's what the industry looked like when we started to take customer service really seriously.

7:40For example, the average response time for a support ticket at Zoom was 48 hours. And I tested it myself and I spoke to a lot of my friends in the space that have Zoom accounts and asked them what their experience was like. Two days. If you had a problem with your webinar, if something broke, if you had a question, if you needed help, if you just wanted to know which plan to buy, you're waiting two days to hear from a human being. For a webinar software user who has a live event happening in an hour, 48 hours is not acceptable. It's actually a catastrophe. And it really erodes a lot of trust. So Nicole and I and the whole team decided to triple down on customer support, to knock their socks off when they interacted with our team when they asked a question, whether they wanted to ask a question before they buy, while they were a customer, even after they left us as a customer.

8:30Our response time, less than 30 seconds, 24 hours a day, seven days a week, 365. We were never closed for our customers. And if you had a question, if you had a concern, you would hear back from us in less than a minute. Now, remember, our average response time was less than 30 seconds. Sometimes they heard back in 10 seconds. See, that's not a small difference. 30 seconds versus two days, right? That is a completely redefinition of what the customer experience looks like in this category. And here's the thing about finding a gap like this. It's not expensive to fill this gap. You're actually competing against these giants and really impressing your customers in a way that's very cost effective.

9:15We trained our support agents. We build the processes. We held a high standard. And the big players were not providing anywhere near this type of support. Why? Ask yourself why. Well, the big players are not providing this type of support because they just simply can't do it at their scale with that volume, That personal support that they were getting from us as a niche software, our customers were really delighted by it, and they knew that they just couldn't get there from a big company. And it was the most powerful competitive advantage we had. Customers would tell us, your support alone is worth a subscription.

9:52We had customers that left us because we were a bit more expensive, because we had a little bit more of a complete solution. They would go to Zoom, they would go to one of our competitors, and they would come back within a month and say, I was there. I have to migrate back because anytime I had a question, it would take days and that's just not acceptable. They didn't know what they were missing until they left us. Now I share with you this story because every business has something like this. Every large company in every industry has a version of the 48 hour response time. Find it. Find out what that is in your world, in your niche, in your competition and own the solution.

10:32Missed calls and slow follow-ups are silent killers for your business. And that's exactly how businesses leave money on the table without ever realizing. That's why today's episode is brought to you by Quo, spelled Q-U-O, the business communication system built so you never miss a call. With Quo, calls, texts, voicemails, transcripts, the contact details, they're all in one clear view. So your team always has the full picture and can follow up for every customer conversation, ensuring a seamless and more personalized experience. Everyone on your team sees the full thread, replies are faster, and customers actually feel like they're taken care of.

11:10And Quo works wherever you are, right from your phone or computer. Keep your existing phone number, add teammates in minutes, sync your CRM, and let the call routing handle itself as you scale. Money's on the line. Always say hello with Quo. Try Quo for free, plus get 20 % off your first six months when you go to Quo.com slash MBA. That's Q-U-O.com slash MBA. If you're selling online or out of a storefront, full-time or as a side hustle, you already know the challenge. You're hoping for people to find your listing or waiting for them to walk in. Lucky for you, there's Whatnot, one of our proud sponsors.

11:49Whatnot flips that. On Whatnot, you go live and sell directly to people in real time. I'm a huge fan of live video. As you know, we built and sold a webinar software for over 10 years. The great thing about live video is that they see what you've got, they can ask questions and buy, and they keep coming back. Anyone can sell, whether your business is big, small, or yet to even exist. People selling on whatnot sell 10 times more than on other major marketplaces. That's because they're not just listing products, you're building real connections with buyers. I'm a big fan of whatnot, a big user of whatnot.

12:25And I've bought products on OneNote because it's a lot of fun, actually. You get to interact with the seller as well as the fact that you get a great deal. It's super easy to use. It's intuitive, which means your buyers are going to find it easy to buy. Download the WhatNot app today and get free shipping on your first order. Just search W-H-A-T-N-O-T, WhatNot, in the App Store and start scoring amazing deals. Let me tell you the number one strategic error I see bootstrap founders make over and over again when they go up against well-resourced competitors. They try to serve everyone. I hinted at this when I talked about niching down the product.

13:08I gave the example of Webinar Ninja. They look at the big players and they look at what they offer and the broad feature sets that they have, the broad services they offer, all the things that you don't do. And they do this because they're trying to serve a wide demographic. It's a massive addressable market. And then I see these bootstrap companies trying to compete on that same territory with a fraction of the resources of these huge players. And they get crushed. Obviously they do because the big player does not need to win the whole market to beat you. They just need to win the customers that you are also chasing.

13:44They just need to take away enough customers from you to put you out of business. And this is just the raw reality of it. And they have more marketing budget. They have more brand recognition. They have more distribution than you'll ever have. So the answer is not to fight on their ground. The answer is to find your own ground. How do you do that? You niche down. A lot of people resist niching down because they feel like if I niche down, I am saying no to customers. I don't have a wide enough market to serve customers. I'm telling you right now that it's very hard to convince people to buy when you're trying to speak to everybody.

14:19I always say when you try to speak to everybody, you're speaking to nobody. Find a specific slice of the market, a specific customer, a specific use case, and serve that customer so well that the big players cannot justify the resources required to compete with you in that corner. At Webinar Ninja, we made a deliberate decision. We are not going after enterprise. We're not going after big businesses. We're not going after medium-sized businesses. We are going after creators, small business owners, teams of five or fewer. That was really our goal. The person who's running the webinar themselves, like the business owner, is running themselves.

14:57They are the decision maker. They're the one that actually is putting their credit card to buy the product. That customer needs something completely different from a large enterprise customer. They need something simple. They need something fast. They need something well-supported. They didn't need a 200-page feature set and a dedicated account manager to set up their account, right? They needed something that just worked and was intuitive. And they needed someone that they can reach out to who will answer their questions immediately when they had a question. And we built for that person. And it was easy for us because I was just basically building for myself or maybe my former self a few years ago.

15:32And because we built for that person specifically, we could serve them better than any company trying to serve anyone. They say the riches are in the niches. Some people say niches, but it's niche. Now, that's not because it's a catchy phrase, but because it's actually true. Hey, by the way, if this episode is giving you a clear picture of how to compete, subscribe to the show, not only to support the show and to show some love, but also because if you subscribe to the show, you'll get this next episode I'm working on that's coming up very soon called 10 Low Cost Purchases Under$200 That Changed My Business.

16:05These are different types of tools, subscriptions, products that really changed the game in my business in different inflection points along my journey. I want to share them with you so that you can immediately level up your business for less than$200. Hit subscribe so you don't miss it. Let's move on to the next tip I need to pass on to you. Here's a mistake I see consistently. Bootstrap businesses try to undercut the big players on price. They try to be the affordable version of XYZ. Do not do this. Why? Because you can't win a price war against a company with deep pockets and endless scale.

16:44You cannot sustain losses for as long as they can. They have funding coming in. They can get cash on demand. You cannot. Competing on price against a huge business is not a strategy. It's actually a slow way to go out of business because you're just not making enough money and enough profit for you to reinvest in your business, to hire more talent, to invest in technology, to also be able to invest in your marketing and sales so you can reach more customers. Here's what you should do instead. Compete on value. Charge more, but give more. At Webinar Ninja, we didn't try to be the cheapest webinar software.

17:20What we try to do is consistently add value to what our customers will receive when they become a customer. So what we did is that we made sure that, yeah, you're going to pay a little bit more, but you're going to get a lot more. You're going to have the chance to run live webinars, automated webinars, series webinars, hybrid webinars. We had all these great features and integrations to make it easy for you to market and to follow up with your customers and make more sales. And we included these things in our plans so that you get more for your dollar. You combine that with world-class customer support and customers are not going to ask you why you cost more.

17:56And I actually learned this from Starbucks. When Starbucks started, there's a reason why they decided to name the sizes of their cups, their coffees, not small, medium, large. If you notice, they're called something else. They're called tall and grande and venti and all these different words that are not typical of buying a cup of coffee at the time when they started. And the reason why they did this is because they didn't want you to compare your cup of coffee that you get every morning with the competition, with the bodega down the street, with the Dunkin' Donuts, with whatever it might be. But we kind of took it to another level.

18:33We kind of thought, okay, if people are comparing different software and they're looking at our packages and saying, oh, wow, I'm getting all this stuff. I can't compare that to what I'm getting with these bigger players because they're only giving me a few things. They're only giving me the basics. So it's not apples against apples. It's apples and oranges. Or I should say apples and watermelons. And guess why we were able to do this? Because we had good margins. When you charge more, you have more margins that you can get more profit and then invest in improving your product to add more value.

19:08You get more value, you get more customers. You get more customers, you get more profit. And then the flywheel continues to get more profit. You have money to invest in the company to continue to add value. Now, I want to make sure before the end of this episode, I address this. I want to be honest about the limits here because there are markets where bootstrap businesses are going against large incumbents in genuinely difficult situations. Not because the strategy is off, but because of the structure of the business. Not every business is able to do this. And I want to make sure you know these exceptions because I've studied these exceptions to make sure that you know them.

19:47I'm talking about industries in medical technology, in financial services, in legal tech. These markets have compliance requirements, legal hoops. They have approval processes that require capital to be able to navigate. It's not just talent. It's not just speed. It's not just customer support. There's money involved. There's lawyers or certificates. There's regulation. There's relationships. A bootstrap business can often get started in these spaces, but the scale to the level where they're genuinely competing with the large companies will almost certainly mean you require some outside funding at some point because things are going to get expensive.

20:24The same is true for any business where distribution requires massive infrastructure. I'm talking about physical retail at scale. I'm talking about manufacturing, logistics. These are not businesses where lean and fast is enough. They are businesses where capital is the game. Listen, you tune into this podcast because I'm compelled to tell you the truth. I want to tell you the truth so that you could be aware of what you're getting into. And more broadly, any market where the primary competitive advantage is budget rather than product quality or customer experience or specialization is really difficult to market for a bootstrap business.

21:03So for example, I'm going to give you like a really extreme example. Like what I mean by the competitive advantage is budget. Well, a good example of this is like space. If you want to go to space, you're going to need a lot of money. And the team that has the most money to invest in great technology is probably going to win in that space. So the leader in space right now is SpaceX, Elon Musk's company. There's other space companies like Virgin Galactic and Blue Origin by Jeff Bezos' company. But SpaceX is the one that's winning all the contracts because they have most of the capital in the space and they started really early.

21:37And the reason why I bring this up is because you need to understand what game you are playing so that you don't set yourself up for failure. So if you're not in any of these markets that where capital is really the defining reason why you're going to be successful, then you are clear to follow all the instructions I gave you today. Let me bring this all together. Competing against massive companies as a bootstrap business is not about outspending them or trying to beat them at their own game. You got to move faster than they can because you can, right? You want to fill in the gaps that they're not filling.

22:09Like the example I gave with the 48-hour response time for customer support and serve the underserved customer. You want to niche down until you are the obvious choice for a specific customer rather than the average choice for a broad niche. You want to compete on value, how much they're getting for the price, not on price alone. Charge more so you can deliver more. And when you're charging, make sure it's not comparable. It's hard to compare your option with their option because you're offering so much more. And it's almost like a different product now because of the value you offer. It means building something so valuable in your niche, in your corner of the market, that the giants eventually want to acquire you so that they can acquire that market.

22:55Or in the meantime, your customers would never dream of leaving you. Both of those are winning. Both of those are available to you, regardless of your marketing budget. If this episode changed how you think about competition, here's an episode that we recently published that goes hand in hand. It's called 20 Years of Business Knowledge in 20 Minutes, and how I built multiple multi-million dollar businesses with what I've learned. I basically share with you what matters most. I'm going to share with you some lessons that you could just focus on so everything else really doesn't matter. Just do these things and you're going to be okay.

23:31If you found today's episode helpful and you want more practical business lessons to help you start, grow and scale your business, the best thing you could do is subscribe to this podcast. Hit subscribe or follow on your favorite podcast app, the one that you're using right now, whether it's Apple or Spotify or wherever you listen to podcasts. By hitting subscribe, you get our next episode automatically, and it's the best way to support the show. It's absolutely free, and it's a way for you to commit to growing your business. And now that you've subscribed, I'll check you in the next episode.

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