8 Things to Do When Your Competitor Goes Out of Business (Two of the Original Tips Now Carry Real Legal Risk)

This guide’s original advice to buy a failed competitor’s email database and the rights to email their customers made sense in 2019. In 2026, doing that without real diligence can trigger fines under three separate privacy regimes at once, GDPR, CCPA, and CAN-SPAM, each of which has gotten considerably sharper teeth since this guide was written.

22.1% of new US businesses close within their first year, 48.6% within five years, and 65.3% within ten, according to Bureau of Labor Statistics cohort data, meaning the scenario this guide addresses, a competitor shutting down, remains a genuinely common event worth having a playbook for. Six of the original eight tactics remain exactly as sound as they were in 2019. Two of them need a real second look before you act on them.

65.3% of US businesses close within 10 yearsBureau of Labor Statistics cohort data found 22.1% of new US businesses close within their first year, 48.6% within five years, and 65.3% within ten, confirming that competitor closures remain a common, recurring opportunity worth a prepared response, not a rare event.

1. Create a unique offer for their customers: unchanged

This remains exactly right. A dedicated landing page with a comparison table, a clear migration path, and a time-limited offer specifically for the failed competitor’s customers still works the same way it did in 2019, and it’s one of the least legally complicated tactics on this list since it targets people who come to you rather than people you contact directly.

2. Create a competitor campaign: unchanged

Running search ads against a failed competitor’s brand name, domain, and login page searches remains a legitimate and effective tactic. The mechanics, cheap clicks on desperate, high-intent searches, work exactly as this guide described, and it pairs well with a broader look at niche-specific PPC networks if the failed competitor operated in a specialized vertical with its own comparison sites and directories.

3. Outreach to their customers: still valid, now needs a documented legal basis

The strategy of finding a failed competitor’s customers through BuiltWith, StackShare, the Wayback Machine, and backlink analysis remains completely legitimate research. What’s changed is the outreach itself: cold calling and texting under the TCPA carries fines of $500 to $1,500 per violation with no cap, and CCPA’s business-to-business contact exemption expired in 2023, meaning California-based contacts you find through this research are now covered by the same consumer privacy rules as individual consumers, with fines running $2,500 to $7,988 per violation. Outreach itself isn’t illegal, but it now needs a documented legitimate basis for contacting each person, not just a good intention.

4. Contact the liquidators or receivers: still valid, one specific tip needs real caution

This is the tactic that’s changed the most. Buying the business, the domain name, or even old blog content from a liquidator remains straightforward. Buying the email database, or the rights to send your offer directly to all of a failed competitor’s customers, is now considerably riskier than it was in 2019. CAN-SPAM’s maximum fine per individual email violation has risen to $51,744 in 2026, GDPR fines can reach 4% of global annual revenue or €20 million, and regulators have issued €7.1 billion in GDPR fines since 2018 alone. Emailing a purchased list without a clear, documented lawful basis, and without disclosing where the data came from, is no longer a minor compliance footnote, it’s a genuine financial exposure.

CAN-SPAM’s per-email fine: now $51,744The CAN-SPAM Act’s maximum fine per individual email violation reached $51,744 in 2026, and GDPR fines can run up to 4% of global annual revenue or €20 million, whichever is higher, with regulators having issued €7.1 billion in GDPR fines since 2018, making the original guide’s suggestion to simply “buy the rights to send an offer” to a failed competitor’s full customer list a meaningfully higher-risk move than it was in 2019.

If you do pursue this route, work with counsel to document a legitimate interest basis, disclose the original data source in your first message, and provide a clear, immediate opt-out, exactly the kind of documentation GDPR’s legitimate interest provisions and CCPA’s disclosure requirements now expect as standard practice rather than best-effort.

5. Monitor social media channels: unchanged, now easier to do well

The advice to step in carefully, without appearing opportunistic, remains exactly right. What’s changed is the tooling: AI-powered social listening has made it considerably easier to catch and respond to relevant conversations in real time compared to the manual monitoring this guide originally assumed, though the underlying advice to stay genuinely helpful rather than obviously self-serving hasn’t changed at all.

6. Take over their backlinks: unchanged

This remains one of the more durable, low-risk tactics on the list. Running a defunct competitor’s site through Ahrefs or Majestic, then reaching out to every site linking to their now-dead page, still works exactly as described, since a broken outbound link is still something a site owner wants to fix, and pointing them toward a genuinely relevant replacement remains a fair, mutually beneficial trade.

7. See if you can help their staff: unchanged

Reaching out to a failed competitor’s former staff through LinkedIn remains a sound, low-risk way to bring in specialized knowledge, whether as a full hire or a short-term contract engagement to audit a specific area of your business. Nothing about this tactic has aged since 2019.

8. Audit your own business: unchanged

Taking an honest look at whether the reasons behind your competitor’s failure exist in your own business remains exactly the right closing move, and it’s arguably more important now, given how much regulatory and compliance complexity has been added to the landscape since 2019, since “unexpected regulatory changes” and non-compliance with data protection laws are now cited as meaningful contributing factors in business failures.

The one thing that hasn’t changed: speed still matters most

The original guide’s closing point remains exactly correct: acting quickly, before other opportunistic competitors move on the same failing business, is still the single biggest factor separating a well-executed response from a missed opportunity. What’s worth adding for 2026 is that speed on tactics 3 and 4 specifically now needs to be paired with a quick legal check, not skipped in favor of it, since the fines involved have grown enough that moving fast and moving carelessly are no longer the same trade-off they were in 2019.

Frequently asked questions

Is it still legal to buy a failed competitor’s email list?

It can be, but it requires real diligence now. You generally need a documented lawful basis for contacting those individuals, disclosure of where their data originally came from, and a clear opt-out, since CAN-SPAM, GDPR, and CCPA all impose meaningful fines for non-compliant email marketing, and CCPA’s business-contact exemption expired in 2023.

How much has the CAN-SPAM fine actually increased?

The maximum fine per individual email violation reached $51,744 in 2026, a substantial figure that scales per email sent, not per campaign, making a poorly-executed mass email to a purchased list a considerably larger financial risk than it would have been in 2019.

Does CCPA actually apply to B2B contacts now?

Yes, the exemption that previously excluded B2B contact data from CCPA expired in January 2023, meaning California-based business contacts are now covered by the same consumer privacy protections as individual consumers, with fines running $2,500 to $7,988 per violation.

Is cold-calling a failed competitor’s former customers still allowed?

Generally yes, but the TCPA imposes fines of $500 to $1,500 per violation with no cap for non-compliant calls and texts, so it’s worth ensuring your outreach follows applicable consent and do-not-call requirements rather than assuming a business contact is automatically fair game.

Is taking over a failed competitor’s backlinks still an effective SEO tactic?

Yes, this remains one of the safer, more durable tactics available. Reaching out to sites linking to a now-defunct competitor page and offering a relevant, working replacement link remains a legitimate and mutually beneficial outreach strategy in 2026.

How common are business closures, really?

Very common. Bureau of Labor Statistics data found 22.1% of new US businesses close within their first year and 65.3% within ten years, meaning a prepared response to competitor closures is a recurring strategic opportunity rather than a rare event worth planning for once.

Should I still hire a failed competitor’s former staff?

Yes, this remains a low-risk, potentially high-value tactic. Former employees bring direct insight into what worked and what didn’t at the failed business, and LinkedIn remains an effective, straightforward way to identify and reach out to them.

What’s the safest first move when a competitor goes out of business?

Building a dedicated offer and landing page for their customers, and running a competitor ad campaign against their brand terms, remain the two lowest-risk, highest-return tactics, since both rely on people coming to you rather than requiring you to contact anyone directly.

Sources referenced: Axis Intelligence (Startup Failure Rate Statistics 2026, citing Bureau of Labor Statistics cohort data), Growthspree (AI Compliance for B2B SaaS and B2B Marketing in 2026: GDPR, CCPA, EU AI Act, CAN-SPAM), SMARTe (CCPA Compliance for Cold Calling and Cold Email in 2026), Unify GTM (The Sales Leader’s Guide to B2B Data Compliance, 2026), StationX (Data Privacy Statistics 2026, citing DLA Piper’s GDPR fine tracker).