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That is pretty egregious, and its also par for the course. And that is why startup companies go through all the hoops of being "stealth" and having NDAs and wh
by ChuckMcM 8y ago
That is pretty egregious, and its also par for the course.
And that is why startup companies go through all the hoops of being "stealth" and having NDAs and what not. There was a German VC firm that was, as I recall, very upfront about this. Clone a successful US company before it got to the European market.
On the one hand it is great to have validation of the idea, on the other its a pain to have someone with more money in the bank able to spend it on marketing and spinning the narrative in their favor.
Since the ability to get a foreign company (in this case Israeli) to do anything is limited, your best bet is to out execute them. Also, love them or hate them, having patents helps in situations like these.
The reality is that if an idea is really good, the people who came up with it know it better than anyone and that gives them a tremendous advantage in terms of knowing what is important and what isn't. Companies have been known to talk about expensive and complicated features or options in order to get people trying to copy their success to waste time and money on something for which there is no actual demand. It is no doubt worth investing in understanding how one's enemies are getting their information and shutting that off if possible.
- jacquesm 8y ago> German VC firm that was, as I recall, very upfront about this https://en.wikipedia.org/wiki/Rocket_Internet https://en.wikipedia.org/wiki/Rocket_Internet
- lapnitnelav 8y agoAh good old Rocket Internet. Used to deal quite a lot with them back in the days. For all the ethically ambiguous things they do, I still remember fondly their creative ways of using AdTech.
- ethbro 8y agoMissing morals seems like a critical enabling technology of creative AdTech.
- wbl 8y agoThere is nothing wrong with competition. Read Smith.
- metamet 8y agoDepends on what you classify as "competition". Theft, sabotage, ad hominem attacks, even murder, could all be considered "competition" if your ethics and morals are on a different plane. So saying there is nothing wrong with competition as a blanket dismissal is a bit myopic.
- jpatokal 8y agoAre you accusing Rocket of any of those? They're famous for cloning business plans, but I wasn't aware they went beyond that.
- johnx123-up 8y agoIIRC Agriya was much popular compared to Rocket Internet in this business
- dredmorbius 8y agoThat depends on the circumstances: Their salaries, too, put [competitors] in the same state with a merchant who attempts to trade without a bounty in competition with those who trade with a considerable one. If he sells his goods at nearly the same price, he cannot have the same profit, and at least, if not bankruptcy and ruin, will infallibly be his lot. If he attempts to sell them much dearer, he is likely to have so few customers that his circumstances will not be much mended. -- Adam Smith, Wealth of Nations, Book V, Chapter 1. https://en.wikisource.org/wiki/The_Wealth_of_Nations/Book_V/Chapter_1 https://en.wikisource.org/wiki/The_Wealth_of_Nations/Book_V/...
- albertshin 8y agoI heard the model was to actually sell the European copy to the original US startup as it got bigger. It was never in their interest to end up operating an actual company. This backfired on them for one of their "investments" (I think an Airbnb clone?) when the US counterpart decided to go head and head against the Rocket's copy in Europe instead of simply acquiring.
- albertshin 8y agoI believe this was Wimdu. Seems like they finally ended up shutting down last year. https://techcrunch.com/2018/09/27/wimdu-rocket-internets-airbnb-clone-to-shut-down-this-year-facing-significant-business-challenges/ https://techcrunch.com/2018/09/27/wimdu-rocket-internets-air...
- joeax 8y agoThis is pretty egregious, but in reality the only thing that was copied was the docs for the API, not the API itself. The other company still has the write all the backend code, and given their track record of just ripping stuff off, may not have the engineering chops to pull it off. In addition, as Smartcar continuously improves their product and API, the other company can only react to these changes. If I was the OP, my reaction would be shock and horror too. But then I'd realize the old axiom of imitation is the best form of flattery.
- rat9988 8y agoI'd take money over flattery any day though.
- jcadam 8y agoMoney is flattering.
- notamerican 8y agoAnd yet, flattery is not money.
- lovemenot 8y agoIt can be: https://flattr.com https://flattr.com
- jbverschoor 8y agoFiattery :-)
- deleted 8y ago[deleted]
- coverband 8y agoAgreed. It sounds like a case of "this looks good, let's follow their format" and revising words/paragraphs just enough so you won't be blamed for plagiarism. The API parameters are very generic so it shouldn't be considered cloning.
- JumpCrisscross 8y ago> Since the ability to get a foreign company (in this case Israeli) to do anything is limited Doesn’t hurt to have a court order in place. Chances are they’ll settle for a material fraction of the cash you know they have.
- Gpetrium 8y ago>The reality is that if an idea is really good, the people who came up with it know it better than anyone and that gives them a tremendous advantage in terms of knowing what is important and what isn't. I have to disagree with you emphasizing this point. If someone/entity manages to get your idea or code, they may be able to sell the solution at a fraction of the cost since their R&D was lower than yours. When the entity is 10x+ your size, they can also afford to gather the resources that increase their odds of success (e.g. marketing specialists, engineers,etc) at a rate which you can't compete. By then, you may have spent 2-3 years creating a business that is destroyed by an external entity acting in bad faith. These things happen quite often.
- orasis 8y agoAt $55M in funding they won’t be undercutting anything - quite the opposite, they’ll need to turn a healthy profit or die.
- carbocation 8y agoAt $55M in funding, they can undercut for years, since they won't need to turn a healthy profit for quite some time. For example, Uber and Lyft. (Point being: survival is not just about the long run, but also the short run.)
- adventured 8y agoFurther to that point about undercutting for years, it's not going to be just $55m. If Otonomo have raised ~$55m, it means they have very powerful, very rich backers (Bessemer, NTT, SK, Aptiv). They might realistically have another $100m over the coming years instead, if they continue making progress.
- jaxn 8y agoI tend to agree with the original comment, particularly for products that are still evolving. We have a competitor who copies our features, but they don't know why we built the feature. The result is they end up copying the wrong stuff or tweaking the feature in a way that completely misses the point. But, I agree with you in that creating a feature isn't an advantage in and of itself. Rather, it is the domain expertise that led to the creation of the feature that is the true advantage.
- stcredzero 8y agoThere was a German VC firm that was, as I recall, very upfront about this. Clone a successful US company before it got to the European market. The Chinese also do this. (As in, the government seems to encourage it outright.) The culture and language barrier do make for an effective moat. It usually takes significant effort and even some cultural change for a company to get its legs for international operation.
- aw3c2 8y ago> The Chinese You mean "Chinese companies". "The chinese" is just racist.
- xapata 8y agoI'm Chinese and I didn't think it was racist. I interpreted the assertion as a description of the Chinese government, not Chinese people.
- stcredzero 8y agoFor the record, I'm Asian and my wife was born in Fujian province, China.
- SolarNet 8y agoNo he means "The Chinese". Not the people, the government. He was quite clear about that in the full quote. > The Chinese also do this. (As in, the government seems to encourage it outright.) Way to be outraged through your own selective reading.
- deleted 8y ago[deleted]
- stcredzero 8y agoOkay, to be fair, I wrote the comment, then immediately thought, okay that could be misinterpreted, then added the parenthetical right afterwards. I didn't do an "(EDIT:)" because I thought no one would have come in so soon. The poor sap might have fallen prey to my foolish decision to use an optimistic concurrency protocol.
- etrautmann 8y agoAlso, while I appreciate this is a name and shame, it might help to put your company's name in the title and not give Otonomo the free exposure for anyone who's not going to dig into the article.
- jwr 8y ago> its also par for the course No, it is not. The world would be a much better place if we all started doing what is right. This isn't difficult: stealing and copying API design and API documentation is wrong. Make a note of the company, people who work there, and VCs who invested. Computers are good at quickly finding information: one day you might want to do business with one of those people or VCs and digging up this information might change your mind.
- evanlivingston 8y agoWhy is it wrong?
- selectiveshift 8y agoBecause people and companies who do this add no value to society. They are parasites.
- evanlivingston 8y agoWhat if they provide the product at a lower price?
- king_magic 8y agoEven then, they are still parasites with no ethics.
- crankylinuxuser 8y agoIf you won't throw your ethics into the pit for power, someone else will. And them everybody will be forced to throw the shared ethics or be outcompeted. And collectively, everyone will be poorer as a result. https://slatestarcodex.com/2014/07/30/meditations-on-moloch/ https://slatestarcodex.com/2014/07/30/meditations-on-moloch/
- 8y ago
- mikhailfranco 8y agoI think you are referring to these rip-off merchants: https://www.wired.co.uk/article/inside-the-clone-factory https://www.wired.co.uk/article/inside-the-clone-factory https://www.forbes.com/sites/ryanmac/2014/07/31/samwer-brothers-billionaires-rocket-internet-ipo/ https://www.forbes.com/sites/ryanmac/2014/07/31/samwer-broth...
- blotter_paper 8y ago>Companies have been known to talk about expensive and complicated features or options in order to get people trying to copy their success to waste time and money on something for which there is no actual demand. Anyone know of a specific documented example of this? I'm not really doubting, just interested.
- tobilg 8y agoI think their first startup was an eBay clone called alando.de which was later sold to eBay when they entered the German market (https://de.m.wikipedia.org/wiki/Samwer-Brüder#Alando https://de.m.wikipedia.org/wiki/Samwer-Brüder#Alando in German)
- blotter_paper 8y agoThanks, but I think you're supporting a different claim by OP. I'm asking about the spread of disinformation to derail the development efforts of clones, not the creation of clones.
- Lucadg 8y agoRocket Internet: they copied Airbnb with Wimdu and wasted 90 M in the process.
- brixon 8y agoThis is commonly called the second mover advantage. If they do not have some special sauce that prevents an easy copy of their idea then it was going to happen sooner or later.
- sonnyblarney 8y ago"Clone a successful US company before it got to the European market." This is really a different case though. The German VC is saying: "Food delivery is working in the US, they've validated the model + EU VC's will now get behind that, so 'do that like they are'. They are more or less competing, not exactly cloning. Copying API's is a whole other level. Literally copying docs etc. is another level. The thing is - the small company may have some power here. The bigger company does not want an ugly, permanent lawsuit hanging over them. With the screen-scraping and blatant copying, it's going to make it seem, at least popularly bad, and possibly add emotive impetus to a judge. The copier cannot say with a straight face that they were not copying to a judge.
- upstandingdude 8y agoNO! Rocket Internet is known and have been busted for straight up copying even website source code, layout, everything. As in the source of the HTML is identical, just the color scheme changed. They are criminals make no mistake, learn how they got their riches, by scamming teenagers with ringtones.
- sonnyblarney 8y agoYes, Rocket copies very specifically, but that does not invalidate my point. Germany VC's will still very rationally imply what I wrote above. If Rocket is behind this, well, they might have laid a bridge too far.
- lrem 8y ago> Also, love them or hate them, having patents helps in situations like these. Does it though? There is no global patent authority. If the ripoff is not for the US market, only a patent for their market will help. Which might be impossible to get in the first place.
- avip 8y agoAddressing this case, for an Israeli company, infringing a US patent implies death. First, there's no "Israel market", US is the market. Second, there goes any chance of future funding. Last, a company s.a otonomo has one way out - acquisition. Say goodbye to that too.
- danielfoster 8y agoCopying as a business model is pretty shitty as is copying legitimate IP. But if Company B can execute a similar concept faster and better than Company A, that's ultimately better for society. This situation looks very egregious though.
- GrinningFool 8y ago> But if Company B can execute a similar concept faster and better than Company A, that's ultimately better for society. Only in the short term. In the longer term, it may no longer be worth the risk for any Company A to begin in the first place.
- mcv 8y agoWill they be able to maintain and improve the code the way the people who wrote it will? The risk is that Company B may be selling something they don't fully understand.
- chrisweekly 8y agoYou're thinking of the Samwer brothers, w/ successful explicit clones of extant businesses.
- rorykoehler 8y agoThat German VC company contacted us to talk about partnering, learnt as much as they could from us and then (not to my surprise) launched their clone of our company with $42m backing.
- mrgordon 8y agoThe German VC firm you refer to is Rocket Internet aka the Samyer Brothers. They cloned every startup they could find for a while. https://thehustle.co/rocket-internet-oliver-samwer https://thehustle.co/rocket-internet-oliver-samwer
- chirau 8y agoThat German company was Rocket Internet. They IPO'd Jumia last week on US markets. Love them, hate them, never underestimate them. Whether you are creating, disrupting, stealing, copying or cheating... just be the best at it. There is reward for that.
- upstandingdude 8y agoThey and their founding brothers are fricking leeches and deserve prison for life!
- kraigie 8y ago>There was a German VC firm that was, as I recall, very upfront about this. Clone a successful US company before it got to the European market. Rocket internet, clone then sell to the U.S. company when they expand. That's not the same as copying their manuals,code or other copyright though. It's more akin to lyft to uber.