The perfect market for a Micro SaaS (that no one talks about)
You know, there's that "perfect market" everyone's talking about.
And then there's the opportunity no one is talking about.
It's a perfect opportunity for a Micro SaaS!
Watch the video version of this article
You should be looking for a niche.
Niche markets are super beneficial!
The most attractive reason is, that you have a greater chance of establishing market dominance without big competitors.
❌ There's a pitfall:
If the niche is too small, your business may not be sustainable.
Finding the "perfect market".
This market is a niche that's big enough to sustain a business, but small enough that it doesn't have big competitors yet.
✅ This is the perfect market opportunity everyone is talking about.
The crowded market.
It's obvious why entering a crowded market ruled by a handful of 10+ years old competitors, is super risky.
❌ Warning sign:
If the market also has a recent history of merges and acquisitions, it's probably a market without many opportunities.
The opportunity no one is talking about.
✅ Markets that are HUGE and expanding in size.
Even though there are big competitors in this market, the market itself is so big that acquiring just a tiny part of the users/consumers is more than sustainable!
In fact, when you zoom in, these tiny parts of enormous markets may be equal in size to that "perfect niche market", but may be expanding more rapidly due to high demand.
You don't hear people mention this opportunity very often.
But it's there. I'm in this market myself 😏
Let me explain why I think this market is the perfect opportunity for small Micro SaaS - here on my YouTube channel.
I hope you enjoy this little read and got a new perspective on the ideal SaaS markets to start building in.
Happy hacking 🚀
I think the line between "The perfect niche market" and a "Spot in a huge market" is pretty thin. Aren't all niches just spots within huge markets?
The advice to niche down is all about taking a general idea (often in a huge market), but optimizing and marketing it to a specific niche within that huge market.
So I guess the difference here is that you marketed your product to anyone and everyone within that market, instead of marketing to the people in your 'spot'. Is that correct?
If so, it's awesome that this worked for you, but I don't know if it's good advice for most indie hackers. Curious to hear your thoughts.
I partially agree, I think the line can be thin.
But I don't think all niche markets are necessarily small "spots" in huge markets - I think a lot of founders are looking specifically for niches that are still somewhat untouched, and where there's a big potential for innovation.
When I'm talking about a spot in a huge and expanding market, I'm generally talking about offering an alternative to the biggest players that are currently dominating that field.
You might be able to offer more competitive pricing, perhaps a better, more modern product that's not impacted by legacy technology - and similar benefits from being a small player. And while you of course need to consider your positioning, you're not necessarily "niching down" within the market, no.
And I know it probably sounds less exciting and intriguing than innovating in a yet-to-become established market, but I do believe that it's one of the easiest ways to get a Micro SaaS started - simply because of the extreme demand.
Interesting, thanks for the response!
This is an excellent article, Simon! 🔥
I can relate to all these things because lately, I have started a new SaaS (https://engagementbuilder.com). It's a tool that is 100% completely focused on Twitter Engagement. Why this? Because we noticed that people have problems when they deal with larger amounts of notifications and it's really hard to keep up.
We chose our market and our target audience, and we're kind of pioneers in this. No one offers, at least to my knowledge, 100% focused software for engagement (we don't even have a schedule option).
I've watched some of your videos on this topic on YT and decided that this was a pretty good idea. To prove that I will just say that we had paying customers since day one. 😁
Great info.
The problem with this is that you might require a lot of starting capital and a great product.
Take for example starting a smartphone or car company. Just my thoughts.
Thanks for posting this Simon
I've also been thinking about a micro SaaS idea.
The idea is to provide pricing page templates that easily hooks in with your Stripe account to make split testing easier & faster and give an analysis of which pricing page converts better. You can also make your custom pricing page with a drag-and-drop feature too.
It's aimed at small SaaS businesses.
What do you think about it?
I think this is a very interesting idea!
If you could find a way to also reliably A/B test different pricing models and price points (as well as parity prices), I think you have a quite strong product.
Thank you for the feedback
Would be great if you give some real time examples.
Nice! I might make a followup post on this topic - including examples in each category. Good feedback.
Thanks for sharing! Loved the production quality of your videos.
Thank you! I'm happy to hear that.
👏👏👏
This is great info. Thanks for sharing, Simon.
You are very welcome!
I start recognizing your brand style :D All the pink colors :)
Awesome man 🤩
I take that as a very nice compliment!
Thanks for sharing, Simon. Always a pleasure to read from you!
Thank you! Really appreciate it 🙌
I've noticed another interesting metrics worth analyzing for bootstrappers.
It's the "winner takes all" effect and how much it's present in a specific market.
For example, you'd have to be crazy to try to compete with FB nowadays as a bootstrapper. The winner takes all effect is pretty strong there.
In comparison, take link expansion services like link tree. It's pretty easy to switch from one service to another (just change your Instagram bio) and the whole market overall can support a lot of players at once.
Curious to hear your thoughts on this.
Great article and great seeing you growing on YT man!
This resonates with the indie hacker podcast on Balsamiq that I listened the day before. Peldi mentioned how Wire framing was a large need in its niche but too small a market for big companies to take seriously.
Nice! I like this a lot. As they say, the riches are in the niches!
When does something become too niche though?