I've avoided a lot of bad investments based on entrepreneurs who answer variants of this question with something like, "Well, they suck and we don't." This answer violates the Law of Common Humanity ("We are pretty much like Them"), which rarely bodes well for the product or the company.
I see the question as both direct and deep. It's a good way to pry open the problem/market space, think about what has been done or is being done by competitors, and consider/query the "new" approach to the "old" problem. If you know your market, it's an easy question to answer. In fact, it's a fun question to answer -- it's not every day that you the luxury of a smart and trained person assisting you with the endless task of prying open and evaluating your problem/market space.
If you consider the question to be aggressive, adversarial, and intended to be harmful, then answering it becomes more difficult, particularly if you're unprepared. On the other hand, if you consider the question to be simply direct, deep, and intended to be helpful, then answering it is much easier.
It’s the same kind of framing of a conversation you get as when an idea is met with “oh, that’s physically/technically impossible” or “that’s way too expensive to possibly work” or “what kind of crazy customer do you think would ever want that?”
Trying to understand how a new idea or product relates to existing stuff is obviously a useful topic of discussion, but depending whether it’s phrased/expressed inquisitively or aggressively could make a big difference. Something like the title of the post under discussion – “someone else had your idea first” – is one of the less productive ways to phrase things, IMO.
Personally, I love answering these kinds of questions and can easily be sent either into passionate “prove why I’m right” mode or passionate “let’s look at this logically/scientifically” mode. But I also know plenty of folks who I think would be great startup founders who respond very defensively or get shut down when they feel attacked.
The problem here is that while the VC might be thinking “The question begs for a deeper answer, [...] an opportunity to demonstrate depth of thought and originality.” what is also happening is that someone who doesn’t thrive on aggressive adversarial conversations will be weeded out, even though they might be great at all kinds of other things, and might be able to express their ideas very well in a less adversarial context. I dunno, I’m not an expert on startup psychology. Maybe the only people who make good startup founders love this style of conversation.
I’m neither a startup founder nor a VC, but I’ve found that in similar contexts (dates, interviews, public debates, private arguments, etc.) this sometimes serves to score points with some external audience, but is almost never the most productive way to advance a conversation that both parties are trying to learn something from.
The goal of a VC isn’t to “win” in a contest against the founder here. The goal is for each side to learn what the other side has to offer and critically evaluate whether a deal makes sense, or whether there are other connections that can be made.
I’ve known a small handful of people who ask aggressive questions like this as a deliberate test to see what the other person will do and are then very savvy about parsing responses and seeing through anxiety/bravado/etc. But this is a very difficult skill to master, and such tests should be used carefully and sparingly.
Most of the people I know who ask this kind of question are just in it because they enjoy aggressive adversarial conversations, even when it’s not at all in their own interest.