Someone did steal my idea, a sales rep I fired. He took my product samples and copied it down to the flaws (small errors I had made in CAD), and on top of that made their product in Taiwan (vs mine USA), and they had much better execution, marketing, and much deeper relationships in the industry. They quite literally got the front cover of every industry catalog, of all the major distributors in all 50 states (1). I have estimated that by the time they got the first 40' container of product in from Asia that they were double our size; we worked out of a 16'x16' garden shed at the time (2).
I have battled them for 10 years and they just sold for 12 million. I would be happy with 1 million. But the truth? The truth is that having a competitor HELPED not hurt. The sales conversations went from "why would I buy that?" to "How does it compare to the other guy?" . in short, their aggressive marketing towed me along in their wake. The geeky informed buyers would buy the USA made original (mine), and the mass market would buy his.
The main outcome is that I could stop spending marketing on advertising, and focus on innovating and product development. Since my industry is distributor based, and my competitor was #1 in all of them, the best way to compete was to out innovate. Also the easiest, and most fun way. Anytime a new truck comes out I usually have a 3-6 month exclusive window before his overseas operation can deliver product. We pick up a lot of new wholesale customers when that happens.
I think that the outcome could have been worse without the 'copy'. For years we couldn't have made the product any faster, we had massive growth in sales. $90K first year, $500K second, $800K, 1.2M, 2M .. it was hard to buy steel some months we grew so fast. In the end. a competitor is not the end of the world, it is a way for the buyer to make a choice - this guy or that guy. It can be easier to sell if they have someone to compare to; when they have nothing it is a little disorienting for a buyer and they tend to not buy anything.
1. product: leveling kit for trucks, so people can put aftermarket wheels and tires on. Another 20 companies copied the product afterward but we don't hear much about them.
2. We have moved twice. From the 16x16 garden shed, to 6800 sq ft, to the current 15,000 sq ft. We now employ 10 people and 5 robots.