The owner of Canada's only real estate trade publication is delaying U.S. expansion. He's choosing to solidify his monopoly and become the 'big fish' in his home market rather than becoming a 'little fish' in the crowded U.S. market where his brand has no equity and he'd face established competitors.
Related Insights
Despite receiving out-of-state and even overseas requests, Miha Books is deliberately choosing depth over breadth. They estimate the California book fair market at $50 million and are focused on capturing a significant share of that local market before taking on the logistical costs and complexities of national expansion.
Contrary to the belief that a moat always leads to large-cap status, small-cap moats often protect a profitable niche. The moat provides time and protection for management to operate, but the "castle" itself may have a limited growth runway, focusing on returns within a specific market.
Niching down allows you to dominate a small pond with less competition, enabling higher prices and faster learning. Once you're the "biggest guy in a puddle," you use your acquired skills and resources to graduate to a pond, then a lake, and finally the ocean.
Instead of a broad launch, Everflow targeted only mobile affiliate networks—a small market they knew deeply from their previous company. This allowed them to build very specific, high-value features for that ICP, win deals, and establish a strong beachhead before expanding into larger, adjacent markets.
Well-funded startups are pressured by investors to target large markets. This strategic constraint allows bootstrapped founders to outmaneuver them by focusing on and dominating a specific niche that is too small for the venture-backed competitor to justify.
Don't fear competitive "red oceans"; they signal huge demand. The winning strategy is to start in an artificially constrained niche (a puddle) where you can dominate. Once you're the biggest fish there, sequentially expand your market to a pond, then a lake, and finally the ocean.
Despite 70% of the market being controlled by HOAs, the advice is to focus on "scatter" individual homes. The HOA market is an auction where the lowest bid wins, destroying margins. By focusing on individual homeowners, the business can control its pricing, maintain higher margins, and avoid a race to the bottom.
Top compounders intentionally target and dominate small, slow-growing niche markets. These markets are unattractive to large private equity firms, allowing the compounder to build a durable competitive advantage and pricing power with little interference from deep-pocketed rivals.
Many founders fail not from a lack of market opportunity, but from trying to serve too many customer types with too many offerings. This creates overwhelming complexity in marketing, sales, and product. Picking a narrow niche simplifies operations and creates a clearer path to traction and profitability.
