To Niche or Not – A Startup Dilema

Entrepreneurs have a lot of stages and different types of journeys in their lives.  From the beginning to the middle to the end.  This particular instance is how you might perceive success in a startup and how to get to that next big milestone.  To Niche or Not?


When you were born and just starting to learn you thought big.  “I want to make an app for everyone”.  You probably told this to a ton of people and bragged about changing the world.  You probably ignored what everyone was saying.  You failed (Unless you got really lucky and your company is something like FaceSpace or MyBook).

You spent time wondering what went wrong and how to correct it.  Then it hit you, because all of your feedback was telling you to really hone in on a niche.  Be specific.  Be targeted.  Know your customer… and all that jazz.



With renewed vigor you try again.  You must be niche.  So niche that you have no competitors.  Why even compete at all?  But you quickly learn that… there is a reason there are no competitors in the space.  It’s so damn small you can’t make any real amount of money.  You failed, again.


Early Adulthood:

So now you needed a niche customer segment with huge potential.  Yeah no problem.  “I can do that” you say.  But wait.  You’ve learned so much from the first two failures.  Do I really have to become niche?

You’ll probably spend a ton of time pondering who your exact customer segment is and what they do.  You’ll probably read books about being lean and discovering real morphine problems and other trendy one liners.  You might get distracted by blogs and Techcrunch instead of doing things.  You failed to act on anything because its all just so overwhelming.  You’ve failed yet again.



If you are still an entrepreneur at this point you are the 5% which has the risk tolerance and experience to really make something grand.  You’ve gotten sick of all the interviews only to discover that you know the same things as when you started.  Lean is great.  But so is real learning by real doing.  Often investors will invest in teams which are proven executers not just with perfect product-market fit.  They know that the team is capable and strong.  They know with a little more time something amazing will happen.  They know this isn’t easy.

So having failed with a niche and having failed without a niche and instead of doing what your advisers say, you consider the next steps much more carefully.  You wonder what it really takes to continue on the path of entrepreneurship.  You wonder what is the one thing you can really nail and prove you have what it takes.  Perhaps your discovery isn’t quite there yet but you are able to either gain traction in another way or build out something that no one is doing.  You look at tomorrow instead of year five.

You take time to consider the following:

Niche: You know people who will buy it.  Your value proposition is strong and your customers resonate with it.  Perhaps you have enough time to find the product market fit.  Perhaps your market is huge.

No Niche: You don’t have a killer use case.  You don’t have TIME to discover and then test all your possible customer segments.  You can build something really freaking cool and build momentum in the process.  You don’t know how big your market truly is and where you will be in five years.

Personally I always thought advice that tells you to go the road less traveled was interesting.  Just because everyone says go do X doesn’t mean there aren’t reason to do the opposite.  This is proven time and time again.  But before you do the opposite have a good reason and a plan.  Don’t just do it to try and be trendy or cool.

You may also have a different experience than the above, which is, in a way, based on my own journey.  Entrepreneurs have to keep so much knowledge in hot memory (that place where you use it enough to be good at it) that it is extremely difficult to nail everything.

That being said.  You better love what you do.  Niche or No.  Opportunity or Failure.  Stay with it.


Author: Adam Perkins

Startup Entrepreneur from Madison Wisconsin.