Re-read The Innovators Dilemma. Startups built on just having better technology or product rarely ever work. You need to compete on an axis that the incumbent can't compete on. The incumbent should be looking at your startup, be aware of what you are doing, and be unable to copy it because doing so would break their existing (profitable) business.
If you are relying on outcompeting the incumbent directly you are in for a really tough fight.