Have you ever struggled to find the right market niche for your startup or product?
I have. Back in 2008, I was running a venture-funded gaming startup, and feeling torn between the fast-growing social gaming action on Facebook, and the slower-moving brain-games SAAS model emerging on the Web.
We had a foot in both worlds — and as a small startup, we could’t do both well.
Eventually we sold our company to a larger, more mature startup who’d focused on & dominated the Web SAAS model.
Lesson learned 🤯
Now, we help teams & leaders define and tackle their hot-core market niche. And we continue learning from people who’ve done it successfully.
Today, we’re going to share some of the most actionable lessons we’ve learned from successful Silicon Valley investors in our “inner circle.” Here are 3 tips to help you identify a market niche where your company can thrive.
If they say you’re crazy, you might just be early
Innovation is about seeing around corners & into the future. It starts with a hunch, something you think might be possible. To others, your idea might seem crazy, or toy-like — until it takes over the world 🚀
Charles Hudson sees this dynamic play out often — & he’s got great advice for how & why to ignore the naysayers when you’re figuring out your market niche.
It’s important to know when to quit — and equally important to know the signals that tell you that you might just be on to something.
Look to adjacent markets for inspiration & ideas
Sometimes, the best inspiration comes from cross-fertilization. When you’re bringing a new idea to life, looking at adjacent markets can help you understand what might be possible, and what kind of business you want to build.
Garry Tan ran into this when he funded Instacart, The team was inspired by the emerging ride-sharing marketplace of Uber and Lyft, and they created a model that scaled into a mega-successful company.
Harness the power of network effects
So many massively successful businesses — companies like Amazon, Google, Netflix, Facebook, Roblox — are powered by network effects.
When you’re looking at your market and evaluating opportunities, ask yourself if your core customer experience gets better for others as new members join, and use it. And if it doesn’t — think about how a different model could bring that quality to your business.
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Now… what about you? Did you enjoy these tips? Which one resonated the most for you?
There’s nothing like turning insight into action, so tell us what you think in the comments