Businesses get into trouble by diversifying too early. Instead, focus on perfecting your primary revenue driver—the "spine" of the company. Once that foundation is solid and you're world-class at it, you have earned the right to expand.
Early-stage companies often dilute focus by pursuing multiple marketing channels at once. A better strategy is to master a single, proven channel and scale it to a significant revenue milestone (e.g., $300k/month) before even considering diversification. This ensures you've won on one front before opening another.
Adding new offerings is a smart growth strategy, but only if your primary business is stable and systemized. Launching a new service to escape existing chaos will only amplify it. Instead, treat the new offering as a separate, dedicated division to maintain focus and quality.
It's tempting to add adjacent revenue streams like training or job boards. However, these often represent entirely new business models requiring different organizational commitments, potentially distracting you from perfecting your primary revenue engine.
According to Peter Thiel, founders who boast about multiple revenue streams or distribution channels are unintentionally revealing a critical weakness. The most successful companies typically have one dominant, highly effective revenue model and one primary acquisition channel driving their growth.
True diversification doesn't come from being a generalist, but from achieving undeniable mastery in one specific domain. This deep expertise becomes your leverage—your "in"—to access rooms, build credibility, and then expand horizontally into other ventures like production, investing, and brand partnerships.
Audit your revenue streams to distinguish 'busy revenue' (high-effort, soul-sucking work) from 'aligned revenue' (energizing, sustainable systems). Focusing on growing aligned revenue, even if it means restructuring or eliminating profitable but draining streams, is key to a sustainable business model.
Counterintuitively, focusing on a single, powerful SKU can be more effective for initial growth than launching a full product line. It simplifies your message, makes you attractive to distributors who value efficiency, and builds a strong customer base before you introduce new offerings.
Instead of trying to elevate all parts of your business equally, apply the 80/20 principle. Dedicate the vast majority of your resources to your most profitable area. This creates a stable financial anchor, providing the security and capital needed to explore other opportunities later.
The garbage collection business was spread thin across five acquisition channels with two different customer avatars. The advice is to cut everything except door-to-door sales—the one channel that is proven, scalable with commission-only reps, and has straightforward unit economics. This singular focus reduces complexity and accelerates the path to profitability.
The best strategy is to capture a large share of a small, specific market and then expand into adjacent ones. Jeff Bezos deliberately started with books for a niche customer base, proving the model before scaling to become 'the everything store.'