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Judo Strategy Moves in Business. How Startups Can Flip to Win.

Writer's picture: Dimitris AdamidisDimitris Adamidis


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CB Insights research suggests that 30% of seed-funded companies successfully exit through an IPO or acquisition. This indicates that securing early-stage funding is one thing, but most importantly, it says that your strategy and the execution plan are critical elements to success. Many strategies can help you to plan and execute well. One of them that you might already use is called Judo Strategy. It's not a new revolutionary way to approach the market, but it gives you some idea of how to define the next step or milestone toward success. 


The Judo Strategy, as its name suggests, is derived from the martial art of Judo, which emphasizes using an opponent's strength against them. For those who have never practiced judo or similar martial arts, it's all about balancing yourself or your opponents. Yes, strength matters, but at the core, it's a dynamic transition of energy that creates the action or reaction before you take advantage of your opponent's position. In a business context, this strategy involves three main elements: mobility, equilibrium, and utilization.


The first refers to a company's ability to respond swiftly to market changes or exploit existing gaps. By default, startups are often smaller and less structured than their larger counterparts. This agility allows them to pivot quickly to new market trends and double down on the niche of the product or service spectrum neglected by the incumbent. For instance, in digital marketing, smaller companies can leverage their creativity and innovative advertising tactics to exploit areas where larger competitors may be vulnerable or constrained by internal policies about their brand perception. Red tape in decision-making is a big part of the advantage angle. In the sales world, a good example would be exploring the specific industries where the dominant solutions are not focusing on, e.g., manufacturing accounts that follow particular practices and features typically used only in the industry. 


Balance is at the core of the approach. Equilibrium involves absorbing and countering competitors' actions. It means maintaining balance and not directly confronting larger competitors head-on. Instead, startups can focus on areas where they can offer unique value propositions or differentiate themselves, occasionally partnering with the incumbent in other areas to build their presence for further expansion or conversion. One good example is offering a unique product presentation or using provocative branding to create a distinct identity, which can help smaller companies stand out in a crowded market.

A primary example would be Dollar Shave Club, which partnered with various online platforms and influencers. These partnerships helped them expand their presence and convert casual viewers into loyal subscribers. By leveraging the existing strengths and reach of these platforms, Dollar Shave Club effectively built a solid customer base without the massive advertising budgets of its larger competitors. Eventually, their success led to their acquisition by Unilever for $1 billion, proving the effectiveness of their strategy. Yes, you always need to have an exit strategy :) 



Utilization is about turning competitors' strengths into weaknesses. The opponent's judo pull or push energy creates movement, which is an advantage for you. Pushing or pulling without knowing when to react will get you in the wrong place. Following the opponent's energy with the right timing is your game. There is a reason why they call it the art. By leveraging the resources and established market presence of larger competitors, startups can find ways to position themselves as more appealing alternatives. It could involve exploiting gaps in the market that larger companies need to look into or use innovative technologies to offer superior products or services. Focus on that one move that you can master is the key. To win, it takes a few moves to know very well or master it to the highest level instead of learning or aiming to master all of them. Your body type, size, weight, and strength differ from your opponents. Similar in business. Double down on your strengths, focusing on mastering the critical moves while revealing the opponent's weaknesses. Remember Blockbuster? Yeah, Netflix's strategic use of the Judo Strategy principles allowed them to outmaneuver Blockbuster. By the time Blockbuster attempted to enter the streaming market, Netflix had already established a firm foothold. Blockbuster filed for bankruptcy in 2010, while Netflix grew exponentially and became the leading streaming service globally. I hope you bought their shares when they IPO in 2002 at $15 per piece. How can a simple strategy convert to something big?  


Conclusion. 

There are a few things that a company must do with their co-founders in order to make this strategy work. In this approach, tactics leading to execution are more important than the framework principles. For startups to compete against larger, more established competitors, you must understand the market well. It is a good strategy that helps you create an angle many players can't see in the trends because they focus on pleasing their shareholders while reporting the quarterly results. Leveraging default agility, focusing on core strengths, and turning competitors' strengths into weaknesses over time allows you to compete on day one. This strategy fits the best when challenging the incumbents with a reasonably high margin on the market and a few players with substantial expansion opportunities across the segments. There is a limited return on investment in the markets, with the commoditized products requiring a considerable investment, which is very likely to need convincing how to conduct business in the new way. There are plenty of examples of how it can work across different markets. 


Here are a couple of things to keep in mind while working on this approach: 


  • Focus on Core Strengths. Even when pivoting or exploring new opportunities, it's essential to concentrate on the main business and core competencies. Avoid getting distracted by tangential opportunities that do not align with your company's strengths.

  • Stay Agile and Responsive. Use your startup's smaller size and flexibility to adapt quickly to market changes or competitor actions. Be prepared to rapidly shift tactics based on new information or changes in the competitive landscape.

  • Leverage Situational Awareness. Always carefully analyze the competitive landscape, market trends, and your startup's position to identify the right timing and direction for a pivot. 

  • Exploit Competitor Weaknesses. Identify areas where larger competitors are vulnerable or slow to adapt and pivot to take advantage of those gaps in the market. It could involve introducing innovative products, services, or partnerships that meet unmet customer needs.

  • Use Speed as an Advantage. Make decisive moves quickly rather than getting bogged down in analysis paralysis. Being first to market in a new area can provide a significant advantage over larger, slower-moving competitors.

  • Turn Competitor Strengths into Weaknesses. Find ways to make competitors' established strengths less relevant or even disadvantageous in the new market space. This could involve emphasizing sustainability, personalization, or other factors that larger companies may struggle to implement quickly.

  • Avoid Direct Confrontation. When pivoting, try to move into uncontested market areas rather than going head-to-head with larger rivals. It allows you to grow without facing immediate competitive pressure.

  • Plan for the Long Term. While executing quickly, ensure that your pivot is part of a broader long-term strategy rather than just a reactive move. It helps maintain strategic coherence and sustainable growth.

  • Be Prepared to "Try Again." If the initial pivot doesn't succeed, be ready to reassess and pivot again quickly based on new learnings. Flexibility and resilience are key to navigating the uncertainties of the startup environment.

  • Leverage Partnerships Strategically. Form alliances or collaborations that can provide resources or market access to support the pivot. Strategic partnerships can enhance your competitive position and help you reach new markets more effectively.

  • Measure the Success. Judo Strategy requires specific metrics to ensure you are staying focused on what matters and mastering your "core skills." 

  • Your north star metric should be market share growth based on the defined TAM, SOM, and SAM. These are critical to ensuring that the angle you build is executed well. Remember that you are not going against the key player yet when you start while you are building and mastering the skill. Measure the rate of customer acquisition compared to industry averages. 

  • Brand awareness and perception are another one. Ensure you have the SOV built and in place. Comparing your CAC and CLV to larger competitors will be another step to monitor how far off you are and how much better you can become. I know your investors will appreciate that, too. 

  • Other metrics I'd use are revenue growth, profitability, competitor responses, agility indicators ROMI, and NPS, which should be used for benchmark purposes. Constantly monitor the competitor's response to your moves. They may or might not respond. 


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