Let's be honest: the "find a blue ocean" (or lake, if you are a hippocorn) advice is getting harder to follow.

What looked like wide-open territory just 18 months ago is now crowded with competitors. AI has lowered the barriers to building software, and everyone seems to be solving the same problems.

So what do you do when you're building in a space that's already competitive?

Don't panic. It’s time to get strategic. (And maybe grow a horn - hippocorns are pretty good at navigating crowded waters.)

The Reality of Competitive Markets

When you're building in a crowded space, you have to know what you are up against.

Customer acquisition costs are brutal.

Customer lifetime value is shorter because people have options.

You're dealing with constant churn as customers bounce between alternatives.

And your sales cycle is longer than the Great Wall of China, as customers evaluate your competitors.

And perhaps most challenging—fundraising becomes exponentially harder because investors have likely already backed someone in your category.

This creates a vicious cycle: you need more capital to compete, but competition makes capital harder to raise.

But here's the thing: some of the most successful companies in history were built in highly competitive markets.

They just needed the right strategy - and maybe a magical horn.

Ways to Win Despite the Competition

If you're already building in a competitive space (or considering it), here are approaches that actually work:

1. Master Counter-Positioning

Counter-positioning is when you build a business model that your competitors literally cannot copy without destroying their existing revenue streams.

This isn't about building a better product. It's about changing the rules of the game entirely. Think of it as swimming upstream while everyone else is fighting over the downstream spots - very hippocorn energy.

Netflix didn't beat Blockbuster by having better movies. They eliminated late fees (a major revenue source for Blockbuster) and created a subscription model that Blockbuster couldn't adopt without cannibalizing their stores.

Today's version of this? Give away for free what everyone else charges premium prices for.

Then monetize differently:

• Offer your core product free and make money on payments or transactions
• Build a "compound startup" where free tools create stickiness for eventual paid products
• Flip the entire industry's business model on its head

The beauty of counter-positioning is that you don't need to outspend incumbents—you just need to outthink them.

Questions to ask yourself:

• What does everyone in your space charge for that you could give away?
• How could you make money in a way that would be impossible for incumbents to copy?
• What would have to be true for your competitors to go out of business if they tried to match your approach?

2. Build Genuine Unique Advantages

Sometimes the best opportunities are in competitive markets—but only if you have a legitimate advantage.

These aren't "we work harder" or "we're smarter" advantages. Those don't scale.

Real unique advantages look like:

Exclusive access to something scarce:

• Proprietary data that competitors can't get
• Licenses or regulatory approvals that limit competition
• Exclusive partnerships with key industry players

Network effects that compound:

• A talent network that helps you hire the best people (who then attract more great people)
• Customer relationships that provide competitive intelligence
• Industry connections that open doors competitors can't access

Process advantages (temporary but valuable):

• Deep expertise in emerging technologies (especially AI right now)
• Unique operational knowledge from previous experience in similar markets
• Proprietary methodologies that are hard to replicate

Questions to ask yourself:

• What do you have access to that your competitors don't?
• What processes or knowledge do you possess that would take competitors years to develop?
• How could you build network effects that make your advantage stronger over time?

Your Competitive Strategy Playbook

Here's how to think about this strategically:

First, honestly assess your situation:

Are you in a competitive market by choice or by accident? If it's by accident, could you pivot to a less competitive adjacent space?

Do you have one of the strategic advantages above? If not, can you build one?

Second, choose your battlefield:

Don't try to compete on everything. Pick the one area where you can create the biggest differentiation and focus obsessively there.

Third, move fast:

In competitive markets, timing is everything. The advantage goes to whoever can execute fastest and build defensibility before others catch up. Hippocorns may look chill, but we can move surprisingly fast when needed.

Fourth, think like an incumbent displacer:

What would make your biggest competitor's business model obsolete? What would force them to choose between their current revenue and competing with you?

The Bottom Line

Competitive markets aren't death sentences—they're strategy problems.

The founders who win in competitive spaces don't avoid competition. They change how competition works.

Whether that's through counter-positioning that makes competition irrelevant, or leveraging genuine unique advantages—the key is being strategic about when and how you compete.

Don't just build a better mousetrap. Build a world where mousetraps are obsolete.

Remember: if a market has no competition, it might not be a market worth winning.

The best opportunities are often hiding in plain sight, disguised as competitive markets that everyone else is afraid to enter.