Why Startups Should Target a Shared Problem, Not Everyone

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The article examines a startup debate by contrasting Fabulis, a niche social network for gay men that shut down in 2011, with PayPal and Facebook, which both began in narrow groups and succeeded. The author argues that a viable niche is defined by a shared situation: a common urgent problem, identifiable members, and people who interact with one another. Drawing on Bill Aulet's segmentation criteria and Paul Graham's advice to focus on a small group of devoted users, the piece holds that targeting everyone fails because it leaves no basis for ruling options out. It cites PayPal's early eBay-seller market and Facebook's campus-by-campus rollout as examples of concentrated groups where word of mouth was built into daily life. The author cautions that these are survivor accounts, some told by people who profited from them.

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