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How to track your competitors

In this article, we cover the importance of choosing the right competitor analysis tool for corporations, startups, investors and advisors.

Just like you, your competitors are always moving, innovating and adapting.

You know firsthand that changes happen quickly, so having access to and leveraging a robust competitor analysis tool is more than a strategic move—it’s vital to the health of your firm. Further, when it comes to tracking your competitors, you want to make sure you’re not only monitoring what they’re currently doing, but also anticipating what they may do in the future. Sophisticated competitor analysis tools—and the data that powers them—should enable professionals to monitor competitors and inform their own strategy with more ease.

Today’s market is filled with many tools you can use to track your competitors. But choosing the right tool depends entirely on the information you need and the questions that matter most to you. Investors, startups, corporations and strategic advisors who operate in the private markets know that gathering this information is easier said than done. This is especially true when it comes to private companies, which aren’t known for financial transparency.

In this article, we’ll outline helpful questions, data points and resources that can inform or be applied to any competitive analysis framework.

Skip ahead to the section that’s most relevant to you:
How corporations can track competitors
How startups can track competitors
How investors can track competitors
How advisors can track competitors
How PitchBook can help you track competitors

How corporations can track competitors

Corporations are always looking for new ways to drive up their competitive advantage. To do that, they need to know who their competitors are—all of them—and what moves they are making. More specifically, corporate teams are often well aware of the most established among their competitive set. However, secondary, fringe and new entrant competitors are more difficult to identify and track. Without access to a trusted competitor analysis tool, a narrow focus on top competitors may open corporations up to being blindsided by these tertiary players.

A good place for corporates to start is monitoring deal activity of emerging competitors and incumbents alike, paying particular attention to any transactions they’re involved in. These deals may indicate whether fringe competitors are gaining traction and/or if established competitors are shifting their approach or expanding their business strategy. Insight into recent deal activity within a space can also give corporations a sense of what new products or services may be in the works for their competitors. Maybe the competitor recently acquired a smaller company and is planning to launch a new product line or enhance its SaaS offerings. No matter the move, having a full picture of your competition and understanding your competitors’ recent dealings may indicate which areas they’re focusing on and which they might be neglecting—leaving room for opportunity.

Corporations can also track other active investors in their space, such as VC or PE firms. It’s possible other investors may compete against your corporation for a deal, so knowing their previous investments or how they structure deals can play a big role in negotiations. Understanding a competitor’s investment history allows you to evaluate their strategies, strengths and weaknesses, as well as gain a better sense of where the threats and opportunities lie.

Questions corporations can answer to get started:

  • How do we find secondary competitors and new entrants into our industry?
  • What competitive intelligence tactics and assumptions should we leave behind?
  • How can we leverage competitor analysis tools to forecast the future of the competitive landscape?
  • How can we identify opportunities to buy, build or partner?
  • What deals have our competitors done recently?
  • Who are the other active investors in our space?

Want to know more about how to answer these questions? Read our latest article that goes more in-depth.

How startups can track competitors

Startups and small businesses can be hard to track, but it’s especially important for younger companies to understand their competitive landscape. By nature, new businesses or startups carry more risk than more established companies—however, they can also be more nimble and pivot quicker than other older companies. This provides room for competitive advantages across the industry.

When exploring how to do market research for a startup, the first step is identifying other competing companies in similar or adjacent markets. After identifying those organizations, startups can look for key financial information on them. This could include the amount of capital that’s been raised, revenue, pre- and post-money valuations, financing history, deal multiples or series terms. These pieces of information can help a startup better understand where it fits into the market and help founders more accurately value their own company.

If able, startups should also look at the investors behind a competitor’s funding round(s). Knowing a firm has invested in a competing company may indicate they’re likely to invest again in that space—enabling startups to reach out at the right moment.

Beyond financial information, startups need a detailed understanding of their own unique selling proposition (USP) and how it’s different from that of their direct competitors. This understanding, in combination with market intelligence, helps a company set itself apart to an investor—especially if a founder can demonstrate how the business fits into an investor’s portfolio.

Additionally, a competing company’s website, brand and social media presence are a good source of information. Monitoring your competitors’ online influence is a good habit to practice if you haven’t started already, as there’s no shortage of competitor-monitoring tools that focus on these areas. For example, Sprout helps businesses manage their own social media, but also places emphasis on competitor analysis tools. In terms of SEO tools, SEMrush was created based on the belief that online competition should be fair and transparent, allowing users to check website health of competitors.

Regardless of which competitor analysis tools you use, tracking the digital health of competing companies can give clues as to whether a company is growing quickly or plateauing.

Questions startups can answer to get started:

  • Which companies in our space are most similar to us?
  • What financial information can we find out about our competitors?
  • Who has invested in other startups in our industry?
  • What makes our startup unique compared to our competitors?
  • How fast are our competitors growing?

How investors can track competitors

To find competing firms in a space, an investor should look to any resource that covers the industry, such as news outlets, data providers and research institutions. League tables are also a great free resource for investors because they show who is doing the most deals in their target industries, region or specific funding stage.

Once an investor has identified their competitors, they should also investigate what companies are in their portfolios, how much capital they’ve invested, and how they’ve structured their deals—as well as follow when they complete new deals. In addition, investors can seek out information about a competitor’s fund, such as the limited partners (LPs) that contributed to it or how much dry powder it has. They can also compare funds with competitive benchmarking. Competitive benchmarking provides a way for LPs and general partners (GPs) to gauge the performance of individual funds in relation to its’ peers and evaluate broader performance across asset classes. Seeing where other investors are finding success (or finding failure) can help a firm determine where or where not to focus.

Another way investors can make sense of all this information is to create a market map. Market maps visually represent a market landscape, making it easier to understand where gaps are, track competitors and chart a firm’s next steps. It can be a great tool for highly segmented markets or industries that defy traditional taxonomies.

Questions investors can answer to get started:

  • Which investors are most active in my industry and region?
  • What companies are in our competitors’ portfolios?
  • How much do we know about our competitors’ funds?
  • Where are other investors finding success or failure?

How advisors can track competitors

Advisors—whether it be law firms, accounting firms, investment banks or lenders—can also look to league tables to identify competitors. League tables will show which service providers or advisors are facilitating the most deals and which industries are booming. With this information, advisors can figure out which sectors may be fruitful for them and identify the prospects that are worth going after for future business.

Just the same as it is with investors, keeping a pulse on the market will open the doors to getting ahead of the competition.

A few questions advisors can answer to get started:

  • Who are our competitors?
  • Which advisors are most active in our industry or region?
  • Who is seeking out advising services from our competitors?
  • What can we learn from our competitors’ moves?

How PitchBook can help you track competitors

PitchBook provides detailed data on every aspect of the venture capital, private equity and public markets ecosystem, including millions of companies, investors and advisors. Our database’s competitive analysis tools and leading industry research enable you to search for competitors based on the attributes that matter most—such as industry, location, valuation or fund performance.

Interested in learning more about what PitchBook tracks? Check out our data.
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