When you ask most founders who they compete with, they pull up a list of logos. Other products that look roughly like theirs. Solve roughly the same problem. Operate in roughly the same space.
That list is wrong. Or more precisely, it is incomplete in a way that quietly kills deals.
The question you should be asking
The starting point for any serious positioning exercise is one question: if we didn’t exist, what would a customer do?
Not: who else is in our category? Not: who showed up at the conference? Not: who is running ads on the same keywords?
What would a customer actually do if you were gone?
Sometimes the answer is another tool. But more often than you expect, the answer is “keep using the spreadsheet.” Or “hire someone part-time to handle it.” Or “just keep doing it manually the way we always have.”
That is your real competition.
Across hundreds of B2B positioning engagements, one mistake shows up more consistently than almost any other: companies position against direct software competitors while they are actually losing 20 to 30 percent of their deals to “no decision.” Not to a competitor. To inertia.
If you are not explicitly positioning against the status quo, you are leaving a third of your deals on the table.
Why founders get this wrong
There are three ways people inside a company typically misread the competitive picture.
Product teams think about who could compete in the future. They are living on the roadmap. They see a landscape of future threats. That is useful for product planning. It is not useful for positioning right now.
Marketing teams think about whoever is spending the most on advertising. They are worried about keywords and conference booth sizes. That is also not what your customers are actually weighing.
Founders and CEOs are often carrying a mental model from the early days of the company, or from the biggest deals they have personally seen. Neither is a representative picture.
The people who have the most accurate view of your real competition are in sales. They have been on the shortlist. They know exactly who else shows up when a buyer evaluates your product. They know what the customer was doing before they started looking.
Phantom competitors
Here is where this gets tactical.
Most competitive positioning tries to cover the full map. You build a comparison page. You list four or five competitors. You write feature matrices. You create blog posts optimized for comparisons.
But many of those companies are not on your customer’s shortlist. Your customer has never heard of them, or has heard of them but would never seriously consider them.
When you position against phantom competitors, you dilute everything. Your messaging gets watered down trying to differentiate from threats that are not real to the buyer right now.
The right question is not “who could theoretically compete with us?” It is “who actually lands on customer shortlists today?”
Those are usually two very different lists.
What this means at zero to one
When you are closing your first ten customers, the competition almost never looks like the charts in your pitch deck.
Your competition is the person who has been manually doing the thing your product does, and is reasonably okay with that. Your competition is the internal spreadsheet that handles 80 percent of the use case. Your competition is the buyer who is burned out from evaluating tools and tempted to punt the decision to next quarter.
You do not win those deals by comparing features with another SaaS product. You win them by making a clear, specific case that what you offer is demonstrably better than what the buyer is currently doing.
That means you need to know exactly what they are currently doing. Not in general. For each segment you are targeting.
If your buyer is using spreadsheets, your pitch is about what spreadsheets cannot do at scale and how your product gets them to the right answer faster. If they are using an internal tool, your pitch is about maintenance cost and the risk of depending on something only one person understands. If they are doing nothing, your pitch starts earlier: you are arguing that this problem is worth solving now, not in six months.
How to find your real competition
If you are not sure who your real competitive alternatives are, go to sales and ask two questions.
First: “Who shows up on the customer’s shortlist when we are in a deal?”
Then: “When we lose, what does the customer say they are going to do instead?”
That second question surfaces the status quo. Status quo does not announce itself on a competitor intel page. It shows up in lost deal notes as “no decision” and gets written off. It should not be. It is a competitor. In a lot of cases, it is your biggest one.
Build your positioning from those answers. Position against what is actually on the shortlist. Make sure you are clearly and specifically better than the status quo.
Your wins will get more consistent. Your message will get sharper. And you will stop losing deals to something you never noticed was competing with you.