Episode 801 | Competing Against Incumbents, Technical Co-Founders, Trademarks, and More Listener Questions with Derrick Reimer
Timestamps are as accurate as they can be but may be slightly off. We encourage you to listen to the full context.
Podcast Summary
In this listener Q&A episode of Startups for the Rest of Us, Rob Walling teams up with longtime guest Derek Rimer (his 21st appearance!) to tackle pressing questions from the SaaS founder community. The episode covers a diverse range of challenges that ambitious entrepreneurs face, from competing against well-funded startup competitors to finding technical co-founders and managing customer churn. (02:40) Derek and Rob dive deep into strategic positioning, product-market fit validation, trademark considerations, and the delicate balance of customer acquisition versus retention.
• Main themes: Strategic competition against funded startups, technical co-founder selection, product-market fit validation, trademark strategy, and intentional customer segmentation
Speakers
Rob Walling
Rob Walling is the founder of MicroConf, co-founder of TinySeed (the first accelerator designed specifically for bootstrappers), and author of "Start Small, Stay Small" and "The SaaS Playbook." He previously co-founded and sold Drip, a marketing automation platform, to Leadpages for a significant exit. Rob has been helping bootstrap entrepreneurs build sustainable SaaS businesses for over 15 years.
Derek Rimer
Derek Rimer is the founder of SavvyCal, a modern scheduling platform, and holds the record for most appearances on Startups for the Rest of Us with 21 episodes. He previously co-founded Drip with Rob Walling, helping build it into a successful marketing automation tool that was eventually acquired by Leadpages. Derek brings deep technical expertise and years of SaaS building experience to every discussion.
Key Takeaways
Position Against Funded Startups by Niching Down
When competing against well-funded startup competitors, Derek emphasizes that funded companies face pressure to target large addressable markets to satisfy investors. (06:41) This creates an opportunity for bootstrapped companies to outmaneuver by positioning more specifically for a niche that would be "too specific for the comfort level of the funded startup." Rather than trying to beat them at their own game, successful founders carve out a corner of the market where they can be demonstrably better for a specific subset of customers. This approach allows you to land and expand from a defensible position rather than competing head-to-head on generic features.
Research Competitor Weaknesses Through Real Conversations
Rob stresses the importance of actively researching where competitors are failing rather than assuming your product is simply "better." (08:38) The most effective approach involves talking to current customers, ex-customers, and former employees on LinkedIn, plus analyzing one-star reviews on platforms like Capterra and G2. This intelligence gathering reveals specific pain points and execution gaps that become your competitive positioning angles. The goal isn't just building better features, but communicating how you've solved the specific problems that frustrate customers with existing solutions.
Validate Product-Market Fit Through Customer Interviews
When facing low retention like Ryan's 29 signups with poor engagement, Derek recommends conducting deep customer interviews using jobs-to-be-done methodology. (22:57) The key is determining whether users signed up to solve a genuine burning pain point or were just casually browsing. Rob points out that finding problem-solution fit comes before product-market fit, and many founders skip this crucial validation step. Even with interview data, signals can be muddy, making this one of the fuzziest but most critical phases of building a SaaS business.
Evaluate Technical Co-founders on Four Compatibility Dimensions
Finding a technical co-founder requires assessment across four critical areas, according to Rob's framework. (34:02) Goals alignment (lifestyle business vs. unicorn aspirations), personality compatibility, work style preferences (solo vs. collaborative), and technical acumen all must align. Most founders focus only on technical skills, but the other three dimensions are equally important and harder to evaluate. Rob suggests using senior developers as paid consultants to assess technical skills, while the other areas require genuine relationship building through industry events and communities.
Segment Customers Intentionally to Manage Churn
When facing customers who use your product for time-limited projects, Derek warns against letting them muddy your metrics and distract your roadmap. (45:46) While short-term revenue from project-based customers might seem attractive, they create "bad churn" that hurts fundraising and exit prospects. The solution involves either turning them away entirely or creating separate pricing tiers (like pay-as-you-go) that acknowledge their different usage patterns. However, Rob notes that most companies eventually eliminate these special tiers because serving non-ideal customers takes a psychological toll and diverts resources from core customers.
Statistics & Facts
- Derek Rimer holds the record for most appearances on Startups for the Rest of Us with 21 episodes, more than any other guest including regular contributors like Ruben Gomez (5-6 appearances) and Tracy Osborn (around 8-9 appearances). (01:26)
- Within TinySeed's portfolio companies, Rob estimates that only 2-5% have filed trademarks for their businesses, despite trademark attorneys recommending universal trademark registration. (40:42)
- The questioner Shane's competitor raised "many millions" in 2022 and has been operating since 2020, giving them a significant funding and time advantage in the B2B SaaS space. (04:02)
