I wonder if that was his actual response to the email. While I think it's a great tone of voice for a blog (I loved it), I think there is a way to mitigate that

I wonder if that was his actual response to the email. While I think it's a great tone of voice for a blog (I loved it), I think there is a way to mitigate that situation and have you come out even better than you were before. Encourage them to build out their products and do it better than you. They will either fail to deliver and you've eliminated a competitor, or you can use his struggles to compete as ideas to generate if he happens to think of neat features you could implement as well. Never try to close doors you couldn't learn from by keeping open and exploring.