I've been meeting with mentors and entrepreneurs to learn more about startups. I've been told that is better to focus in one feature and one sector in the market. I have a service that can help more people than what I thought but my cofounder and mentors say just focus on one sector. I'm was trying to go for a bigger market.
Well, I have failed twice already with two attempts. This is what I have learned -
Don't try to build a titanic. Make a fishing boat and start sailing. Your mentors are correct when they say just focus on one sector and not try to go for a bigger market.
I am not sure how much complete your 'service' is, but during the last 30-40% the things are quite tough. Its that period when you have spend substantial amount of time and money with no returns. You start to rush on with things and this is where the ship usually sinks for many startups. With a smaller service area, you will be able to manage the things a lot better with less investment of time and money.
Plus with a fishing boat you have a chance to built a 'Titanic' or a 'Military Warship', but its almost impossible to change from 'Titanic' to a 'Military Warship'.
Going for a bigger market isn't a bad thing in and of itself. But being a start up, you have limited resources and you have to use them effectively. Giant players can throw money at every aspect of the market available to them (in fact, it's part of many giants' business model!). You have to be more judicious.
I would recommend keeping the secondary markets in the back of your mind. Don't count them out just because you don't have the resources for them yet. But stay focused on your primary market for now. Prove your business model in one market before expanding out. Ideally, revenue from your first market venture will fund further explorations.
I'd say listen to your mentors and co-founder.
In my experience it's always more effective to target a small market and expand than it is to try and target a large market first.
1) You can make mistakes without ruining your reputation to a large market
2) It's cheaper and easier to target a smaller market
3) It gives you focus and allows you to deliver on the subset of functionality you need for the smaller market
4) It allows you deliver something smaller faster, and starts you to the road of profitability earlier
5) It gives you a reality check much quicker - if you can't make it work for the small market you are never going to make it work for the large
7) It's much easier to find and talk to people in a smaller market who have a need for the product
Totally agree with Adrian Howard.
Of all the startups I've heard of, the analogy of building a fishing boat or the titanic is accurate. A simple, niche focused service will be quick to build and establish. A big, advanced, everything service, will take a long time to build and a long time to establish.
All depends on your time and patience!
I think the biggest websites catered for everyone from the start. It seems as though the foundations for your startup have a big impact on the potential of being huge. Take Google, Fb, Ebay, Amazon for example. They started small, but they were tailored for everyone from day one. Even facebook, which only accepted a thousand students at first, was still tailored in a way that anyone could use.
Tell us your startup and we can be more helpeful!