I discuss this pretty deeply in my indie founder bootcamp but the main point is, if your revenue goals are something like $20k/month (and not to build a unicorn) then one of the lowest risk decisions is to try to get a very tiny percentage of a “proven” very large market.
The reason is that getting a few hundred or a few thousand customers in a proven market with millions of customers is a very achievable goal over a few years.
No need to compete on price, just compete on great customer service and support. Be someone that your customers know and like and love dealing with.
And of course you do need to make a great product and find a marketing channel(s) to reach that small segment of customers.
Interestingly I changed my pricing quite a lot, because many people were complaining that competitors are cheaper and it's kind of hard to hide this fact.
But still I got some ideas which I'm going to implement, and hopefully increase my value.
For me, $20k/month is surreal. But for someone it's nothing.
Trying to take 0.01% of a market from existing businesses who'll fight hard to retain their customers is immeasurably harder than trying to grow the market by 0.01% by looking for businesses who aren't yet buying a product in that market. Unless you're launching something in a completely saturated marketed it's always better (cheaper, faster, easier) to find new customers than trying to take existing one from other business.
Bonus: Growing the market by 0.01% gets you more customers than taking 0.01% of the existing market.
$20k/month is really a paltry amount of revenue for a business.
If your expenses are like $5k a month and your getting maybe $180k a year in profit before taxes this is really more like a job than a business.
A business making revenue of $20k a month must be a very small idea, for example a service that pings some servers and alerts customers of downtime or maybe some kind of file storage. Conceivably that means you can quickly pump out a lot of similar sized ideas and perhaps get multiple revenue streams going, each averaging $20k a month or so. Now you can afford to hire talent.
Even the most obscure ideas have plenty of competitors (I know I write table planning software for events). If you come up with something that has no competitors, either:
-you didn't look hard enough
-you are a genius who spotted an untapped demand (very unlikely)
-no-one wants it (very likely)
Also, remember that the main competitor to a lot of software is Excel and post-it notes.
That said, the more competitors the harder it is to get noticed. Ideally pick something where you have got a reasonable chance of getting on page 1 or 2 of Google.
Isn't also possibled that although the idea in itself might be desirable every potential competitor who attempted to build something similar encountered a technological or administrative problem that stopped them in their tracks?
BTW Don't clone a successful product. Have some respect for yourself and for others. It rarely works anyway (struggling to think of a single case where it has).
As a synonym, every time I had an APP idea, I search the play store and App Store and there are at least 10 variants. Discarded. After this happened couple of times, I have had enough.
I decided to create an app to browse and search through videos on your computer. There are many out there, but none had the specific set of features (and visual appeal) that I wanted.
I now sell about 100 copies per month for about $500 income per month. I give $350 to charity for every 100 copies, but that's a personal decision.
Building it has been a great learning experience. Interacting with customers has been a very rewarding experience (so many people love it).
I think a lot of times in maker communities building what already exists is not seen as good which I don't get.
Having a few competitors shows that there is market for what you are doing and you do not have to be same as others you just have to be better like better feature, UI, support maybe.
Oftentimes it makes more sense to think of the presence of competitors as just another means of validation -- confirming that someone needs this. If there's no need, there won't be anyone on the market
Another thing to consider is that there is always turnover in a market. Even if there are always 170 competitors you can be certain that each year some of them drop out and new ones appear. Guess what the new ones did. They made the effort.
You may fail if you try, but you will fail if you don't. Someone is going to replace one of the existing players, why not you?
You are right that not all successful business started with an original idea. You are right that not all of them required significant upfront investment, and you are right that there are great newcomers who find a niche in an established market.
There is only one thing you are missing. How many businesses like that have failed. Is it 1%, 10%, 50%, 90% or 99%? I would guess that it's somewhere upward of 90%. BTW. And you won't even hear about failed companies because these 170 competitors are survivors.
Having capital increases your chances of being able to experiment and find market fit.
Having limited competition increases your chances of being noticed.
Having a fresh (doesn't have original) idea helps you laser-focused on what you are trying to solve.
BTW. I am not trying to discourage you from trying. However, if you want to try, I recommend doing this with your eyes open.
Eventually it becomes an obstacle to the customer who has to pick between all of these competitors. But seriously, uptime / API monitoring with dashboards is a space I spent way too much time researching to find the thing that matches my requirements. If you can stand out via those features I absolutely needed I would have stopped my search almost instantly. pingr is an example of a tool which looks like the bare minimum (good if they can make it work), so I wouldn't have been able to even consider them.
I wouldn't agree that people choose products based on what their friends are using. At least for me it doesn't work.
While the second part is true, I agree.
It's really hard to overcome existing players, on the other hand there are some advantages: existing players are kind of slow in terms of changing (adding new features) and in terms of support.
Among these 170 alternatives, more than half of them were built in 2010 I guess, and they do not evolve.
Regarding paid ads. This year I was watching how other guys do with their side projects and I literally haven't seen anyone who tried paid ads. They did SEO though, but not google ads or something like that. Because they are good at reaching the right audience in the right place, I guess.
This pricing is actually not that far-fetched. Consider that the competitor UptimeRobot offer 50 monitors at 5 minutes interval for free.
You can lease servers very cheaply nowadays, uptime monitoring is not resource-intensive and is an easily distributed workload. The most expensive part of the operation is likely to store the monitor results in a database.
[+] [-] jv22222|5 years ago|reply
The reason is that getting a few hundred or a few thousand customers in a proven market with millions of customers is a very achievable goal over a few years.
No need to compete on price, just compete on great customer service and support. Be someone that your customers know and like and love dealing with.
And of course you do need to make a great product and find a marketing channel(s) to reach that small segment of customers.
[+] [-] Akcium|5 years ago|reply
But still I got some ideas which I'm going to implement, and hopefully increase my value.
For me, $20k/month is surreal. But for someone it's nothing.
[+] [-] onion2k|5 years ago|reply
Bonus: Growing the market by 0.01% gets you more customers than taking 0.01% of the existing market.
[+] [-] xwdv|5 years ago|reply
If your expenses are like $5k a month and your getting maybe $180k a year in profit before taxes this is really more like a job than a business.
A business making revenue of $20k a month must be a very small idea, for example a service that pings some servers and alerts customers of downtime or maybe some kind of file storage. Conceivably that means you can quickly pump out a lot of similar sized ideas and perhaps get multiple revenue streams going, each averaging $20k a month or so. Now you can afford to hire talent.
[+] [-] hermitcrab|5 years ago|reply
-you didn't look hard enough
-you are a genius who spotted an untapped demand (very unlikely)
-no-one wants it (very likely)
Also, remember that the main competitor to a lot of software is Excel and post-it notes.
That said, the more competitors the harder it is to get noticed. Ideally pick something where you have got a reasonable chance of getting on page 1 or 2 of Google.
[+] [-] count|5 years ago|reply
[+] [-] etherio|5 years ago|reply
[+] [-] Akcium|5 years ago|reply
[+] [-] hermitcrab|5 years ago|reply
[+] [-] ramshanker|5 years ago|reply
Finally decided to go anyway.
[+] [-] yboris|5 years ago|reply
I now sell about 100 copies per month for about $500 income per month. I give $350 to charity for every 100 copies, but that's a personal decision.
Building it has been a great learning experience. Interacting with customers has been a very rewarding experience (so many people love it).
Video Hub App - https://videohubapp.com/en/
and Open Source on GitHub - https://github.com/whyboris/Video-Hub-App
[+] [-] Akcium|5 years ago|reply
What can you do? Make them better, or at least try =)
[+] [-] drchiu|5 years ago|reply
Reasons:
- more likely I’ll find the product that fits my budget and needs
- ability to switch out of an unfavourable technology stack that no longer works for me
- competition helps encourage the vendors to improve their products and fix bugs
[+] [-] PaulDavisThe1st|5 years ago|reply
https://en.wikipedia.org/wiki/The_Paradox_of_Choice
[+] [-] Akcium|5 years ago|reply
[+] [-] atharahmed|5 years ago|reply
Having a few competitors shows that there is market for what you are doing and you do not have to be same as others you just have to be better like better feature, UI, support maybe.
[+] [-] Akcium|5 years ago|reply
[+] [-] saviorand|5 years ago|reply
[+] [-] Akcium|5 years ago|reply
So there is at least some demand
[+] [-] phkahler|5 years ago|reply
You may fail if you try, but you will fail if you don't. Someone is going to replace one of the existing players, why not you?
[+] [-] victorronin|5 years ago|reply
You are right that not all successful business started with an original idea. You are right that not all of them required significant upfront investment, and you are right that there are great newcomers who find a niche in an established market.
There is only one thing you are missing. How many businesses like that have failed. Is it 1%, 10%, 50%, 90% or 99%? I would guess that it's somewhere upward of 90%. BTW. And you won't even hear about failed companies because these 170 competitors are survivors.
Having capital increases your chances of being able to experiment and find market fit.
Having limited competition increases your chances of being noticed.
Having a fresh (doesn't have original) idea helps you laser-focused on what you are trying to solve.
BTW. I am not trying to discourage you from trying. However, if you want to try, I recommend doing this with your eyes open.
[+] [-] heipei|5 years ago|reply
[+] [-] _wwwg|5 years ago|reply
Good luck with Pingr :)
[+] [-] Akcium|5 years ago|reply
My family literally has one, mom-and-pop store of radio receivers :)
Thank you!
[+] [-] tatsuhirosatou|5 years ago|reply
People often choose products based on what their friends are using and what they see people online mentioning.
How can you get in front of people first without spending tons of cash on marketing and paid ads?
[+] [-] Akcium|5 years ago|reply
While the second part is true, I agree.
It's really hard to overcome existing players, on the other hand there are some advantages: existing players are kind of slow in terms of changing (adding new features) and in terms of support.
Among these 170 alternatives, more than half of them were built in 2010 I guess, and they do not evolve.
Regarding paid ads. This year I was watching how other guys do with their side projects and I literally haven't seen anyone who tried paid ads. They did SEO though, but not google ads or something like that. Because they are good at reaching the right audience in the right place, I guess.
[+] [-] mariopt|5 years ago|reply
If I create 20 monitors at a rate of 10 minutes I only pay $1.00 + $1.04 / mo
How do you create a sustainable product that you can realistic maintain when you've to pay taxes, hosting, etc. at this price?
[+] [-] zapt02|5 years ago|reply
You can lease servers very cheaply nowadays, uptime monitoring is not resource-intensive and is an easily distributed workload. The most expensive part of the operation is likely to store the monitor results in a database.
[+] [-] cpeterso|5 years ago|reply
[+] [-] k__|5 years ago|reply
It's always worth a try.
[+] [-] felix12777|5 years ago|reply
[+] [-] jvanderbot|5 years ago|reply
That's Borat-level pep talk.
[+] [-] Technically|5 years ago|reply
[deleted]
[+] [-] 29athrowaway|5 years ago|reply
https://www.youtube.com/watch?v=3Fx5Q8xGU8k
It's a clickbaity title but it's a serious talk.
[+] [-] Akcium|5 years ago|reply