If you’ve been thinking about launching a vertical startup, but don’t know where to start or which market to address, then this blog post is for you.
There are many different ways to categorize a startup business, and their success rates depend on how they’re structured.
Vertical startups are among the most popular types of new businesses that entrepreneurs choose to launch because they offer specific products or services in a market with limited competition. In this article, we’ll discuss what vertical startups are and how to get started!
1. Vertical Startups are companies that cater to a niche market (a marketing vertical) and focus on customer experience
Startups that are vertical offer a product or service to solve various problems for a specific market niche. These startups are often more successful because they have a clear-cut goal and target audience.
Startups that cater to the general population, on the other hand, can be difficult for entrepreneurs as there is no specific problem or need addressing by their product/service – this makes it harder to get traction in an already crowded market with lots of competition.
2. They can be more profitable than traditional startups because they have less competition
Vertical startups are often more profitable than traditional ones because they have less competition in the market. This is because the more vertical startups focus on smaller niches where little competition exists. There’s a higher demand for the customer experience in vertical markets when compared with general market products and services that compete on price. The customer experience focus of vertical startups means customers will be willing to pay top dollar for the added value.
3. An already established customer base is needed to go vertical with a vertical startup
It’s essential to start with the market audience in mind first. The best vertical startup ideas are where there is an established customer base, so you know your target market before building a solution.
Steve Jobs says, “I’ve always found is that you’ve got to start with the customer experience and work backwards to the technology. You can’t start with the technology and try to figure out where you’re going to try to sell it.”
Suffice to say; it would be a mistake to ignore the market and start with the product first.
4. You should also think about the type of life you will create for yourself
Founders often jump into business ideas without considering where these decisions will place them in the future.
Task: Answer the following questions. Do not write numbers or bullet points, and do your best to make it sound natural!
What does your startup life look like ten years from now? Ask yourself, “Will I like doing these things ten years from now?”
5. Here’s how to get started with a vertical startup: start with the audience, find out their desires, hopes, and needs; research competitors and see how much demand there is for their products/services; come up with an idea for a product or service that solves one of these problems; figure out whether it would be better as an online business or brick-and-mortar store; set aside some time every day to develop your idea into something tangible
If you’re not sure, start with something small. You can always scale up later if it’s successful or pivot into a new idea or technology that might be more profitable for what your market wants right this minute (or next year). The best part is because we are starting with the audience first, a pivot into different solutions is relatively easy.
Our focus on the people anchors the business focus.
Some final words:
Don’t be afraid to make mistakes. “It doesn’t matter how many times we try because there are no mistakes when starting – only lessons learned along our path of growth as entrepreneurs.” — Tessa Blakely-Symes
If you enjoyed this article, you’ll probably enjoy Launching a Startup with The Vertical Method