Why Niches Are Bigger Opportunities Than You…
If I told you I bootstrapped a $20M bibliography business, your first reaction might be “Huh, bibliographies?” Yes, I do mean bibliographies, the list of resources you’d put together to reference what sources you used when writing a research paper.
If I told you it was a high growth, high margin business, that I sold it to a public company, and scaled even further while there, you might think I was downright lying. How could you create a business of that size in such a random, niche space?
I wouldn’t have even believed the story 20 years ago, when I started the business as a high school student at the age of 16. With a friend, I decided to build a product called EasyBib that would automate citations and make bibliographies easier. I had no idea that for something so niche the market could be so huge, that every high school and college student in western educated countries could be a potential customer. Moreover, I certainly didn’t have the foresight that I could build ad, subscription, and enterprise business models around the concept.
Why niches are overlooked
This is often the case with niches. It’s difficult to imagine how big an opportunity can be when it’s a problem or market that is very specific. You may dismiss it as a problem you identified that is uniquely yours and assume it’s a small opportunity. Or, you can’t fathom how you would possibly create a business model around the concept.
However, we’re assuming we find niche opportunities in the first place. These days, with the allure of massive Silicon Valley exits, many entrepreneurs I meet think in terms of VC funding and billion dollar ideas.
In fact, I’m no different. After selling my business to a NYSE public company, Chegg, and serving there in an executive role for three years, my business partner and I left to think about how we can create an even bigger business. Now that we have flexibility, and much lower risk, how can we shoot for the stars, we thought.
We poured through TechCrunch, Forbes, TheNextWeb, etc. identifying themes and researching possible gaps in the market. We came up with dozens of ideas. AI for this and AI for that, or better data processes for this industry or that industry. Lo and behold, there were dozens of players already pursuing these ideas, and little room for differentiation.
Unique opportunities are everywhere, if you look
We decided to take a step back. We were spending our time researching all these “hot” spaces. What if, instead, we started looking at “boring” spaces. What if we went back to our roots and started exploring niches that might be big enough to matter.
We dove into the wild world of the internet, and started finding amazing and niche services and opportunities everywhere.
For example, we came across RhymeZone, a site run by an MIT Researcher and computer scientist, that as its name suggests, is the best place to find rhyming words. The founder had developed the site in the early 2000s, having been around the world of lexicography. According to SimilarWeb, it’s used over 7 million times monthly. It’s incredible.
Find A Grave, another specialized site, was started as a hobby to find the graves of deceased famous people. It soon grew into a community where people can find where their family and loved ones are buried. It’s used over 15 million times monthly. I was dumbfounded to learn of the service and its popularity, but having myself built a large niche product, it shouldn’t have been so surprising.
We eventually stumbled upon the casual gaming space. We found out that Scrabble word solvers were wildly popular, which makes sense when you think about the popularity of Scrabble. We didn’t anticipate though the space gets over 60 million visits monthly! We also found that old school games like minesweeper and solitaire continue to be popular, which led us to our current exploration of how brain training and classic games can be linked. Even sites that cover games rules have large followings.
Recently I caught up with two friends starting a business called BeamJobs, where they’re exploring a resume builder specifically for tech professionals. Upon first impression I thought this might be too niche. They quickly explained how many people might need this, and why they thought this could be big. Who was I to second guess? Niches are where the opportunities are at!