Building something that can add a little value to millions of people isn’t the way to succeed.
You’re way better off building something that can add a lot of value to a very small group of people.
Riches are in the niches.
There isn't actually more money in niches.
There is less. Niches are by definition smaller markets.
There is easier money in niches and that's what we are after.
Big companies play in big markets.
A $100 million market is too small for Google.
Google makes over $100 billion a year in search.
Niches aren't worth their time.
Big markets attract deep-pocketed competitors like big companies and VC-backed startups.
Avoid them.
Small markets attract fewer competitors.
You can make great stable money without competing against companies happy to lose money for long periods of time.
Invest in new features on your own time. Not because you have to keep up.
And happily print profits year after year.
In small markets, you have pricing power.
Without the threat of substitutes, you can charge more and there aren't great alternatives for your customers to leave for.
As long as you are providing value, customers are happy to stick around and keep paying.
Starting small doesn't mean staying small.
You can take adjacent markets and grow.
Amazon did $150 million in only book sales before it started selling CDs.
Most successful companies start this way.
This is why we buy vertical market software at Verne.
Google isn't entering the software market for left-handed dentists anytime soon.
We can buy the best solution for a niche and comfortably take profits while providing a lot of value for happy customers.
Everyone wins.